Industrial Goods Index Drive Market Cap by N1.12trn WoW
Kayode Tokede
The stock market of the Nigerian Exchange Limited (NGX) gained N1.12trilliion Week-on-Week (WoW), recovering from the previous session’s profit-taking over investors demand for stocks in the industrial goods index.
Thus, the NGX All-Share Index advanced by 1.97 per cent week-on-week (WoW) to close at 104,421.23 basis points. Similarly, the market cap increased by N1.12 trillion to the week at N57.158 trillion.
Following a 9.9per cent gain recorded by Dangote Cement Plc and 4.90 per cent growth in BUA Foods Plc stock price, the NGX Industrial index outperformed, recording a 6.36 per cent week-on-week gain, while the NGX Consumer Goods index also ended the week positively, rising by 1.30 per cent.
Conversely, NGX Banking and NGX Insurance indexes retreated by 4.52 per cent and 4.07 per cent, respectively for the week, while NGX Oil & Gas index recorded a weekly decline of 2.47 per cent.
The market breadth for the last week was positive as 27 stocks appreciated in price, 64 stocks depreciated in price, while 64 stocks remained unchanged.
Tripple Gee and Company led the gainers table by 42.05 per cent to close at N4.02, per share. Meyer Plc followed with a gain of 20.79 per cent to close at N4.30, while Cornerstone Insurance went up by 20.25 per cent to close to N1.90, per share.
On the other side, DAAR Communications led the decliners table by 22.22 per cent to close at 70 kobo, per share. Etera followed with a loss of 19.49 per cent each to close at N22.10, while SUNU Assurance declined by 19.11 per cent to close at N1.82, per share.
Overall, a total turnover of 3.893 billion shares worth N95.147 billion in 69,117 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 2.981billion shares valued at N57.873 billion that exchanged hands prior week in 67,962 deals.
The Financial Services Industry (measured by volume) led the activity chart with 2.640 billion shares valued at N47.654 billion traded in 31,929 deals; contributing 67.81 per cent and 50.08 per cent to the total equity turnover volume and value respectively. The Oil and Gas Industry followed with 347.962 million shares worth N4.064 billion in 5,972 deals, while the Conglomerates Industry pulled a turnover of 337.682 million shares worth N4.709 billion in 5,493 deals.
Capital market analysts expected sustained positive sentiments on the stock market to continue this week as more companies released 2023 financial year end results on the NGX.
Despite profit-taking and portfolio adjustments by fund managers impacting stock prices recently, the market rebounded, driven by high volatility, corporate earnings releases, and anticipation of the dividend season.
As the market delves into the peak of the earnings reporting season, sentiments and fundamental earnings factors are steering momentum and liquidity levels.
Market players reacted strongly to early filers, witnessing heightened trading volumes and positive market breadth. The resurgence of buying interest, particularly in banking stocks, propelled the market beyond the psychological 104,000 basis point threshold.
Looking ahead to the week, analysts at Cowry Assets Management Limited said “we anticipate the continuation of positive sentiments in the local stock market. However, we foresee a mixed trend with a possibility of profit-taking as investors are likely to continue sectoral rotation, capitalizing on stocks that experience pullbacks to position themselves strategically.
“This rotation strategy is expected to create further buying opportunities, especially in anticipation of more earning releases in the corporate reporting season. Amidst all these, we continue to advise investors to take position in stocks with consistent track records of dividend payments and strong fundamentals and growth prospects to support earnings growth.”
The chief operating officer of InvestData Consulting Limited, Mr. Ambrose Omordion said “as the market enters the peak of the earnings reporting season where sentiments and earnings fundamentals drive momentum and liquidity level as players react to the numbers being provided. These results are expectedly impressive or disappointing, depending on where the pendulum swings. This will drive oscillation and volatility as dividend announcements and corporate actions pour in this month.”
Analysts at Cordros Research stated that, “In the ensuing weeks, we expect the NGX to be flooded with corporate earnings releases as more companies publish 2023FY numbers alongside dividend declarations.
“While this influx of results may stimulate buying activities on the bourse, we also anticipate potential profit-taking, especially on stocks that have seen notable price increases recently.”
