Stock Market Sustains Gains as Q1 Results’ Expectations Spur Demand

By Goddy Egene

Buying interest in MTN Nigeria Plc, Zenith Bank Plc and Guaranty Trust Bank Plc led to gains that made the local bourse to sustain its positive performance yesterday.

The NGX All-Share Index rose 0.43 per cent to close at 39,015.58. Similarly, the market capitalisation added N87.7 billion to close at N20.4 trillion. The bulls were fully in control of the trading as 24 stocks appreciated compared with the 13 that depreciated.

Market analysts said the renewed demand could be linked to high expectations among the investors as first quarter earnings season kicked in.
According to operators, most people are upbeat on the Q1 results, especially the banks, a development that may have been explained the number of banks among the price gainers yesterday.

Out of the 24 gainers, eight were banks. However, Honeywell Flour Mills Plc and PZ Cussons Nigeria Plc led the price gainers’ table with 10 apiece. The banking stocks that appreciated were Sterling Bank Plc(4.9 per cent); Fidelity Bank Plc (3.8 per cent); Ecobank Transnational Incorporation Plc (3.0 per cent); Zenith Bank Plc (2.7 per cent); Wema Bank Plc (1.7 per cent); Unity Bank Plc (1.6 per cent); GTBank Plc (1.6 per cent) United Bank for Africa(UBA) Plc (0.7 per cent).

UBA on Monday released its Q1 results, showing improvement in performance indicators and indicating what should likely be expected from other banks.

The bank grew its gross earnings to N155.4 billion in 2021, up from N147.2 billion recorded in the corresponding period of 2020. The bank leveraged on modest growth in both interest and non-interest income as well as increased efficiency to deliver an impressive 24 per cent in profit before tax (PBT), which printed at N40.6 billion, compared with N32.7 billion in 2020. Profit after tax (PAT) grew faster by 26.8 per cent from N30.1 billion to N38.2 billion.

Commenting on the performance, Group Managing Director/CEO of the UBA Plc, Mr. Kennedy Uzoka, said it reflected bank’s capacity to sustainably grow earnings even in a highly uncertain macroeconomic environment.

He said: “This impressive 2021 Q1 results reflect the capacity of our business to sustainably grow earnings even in a highly uncertain macroeconomic environment. We remain upbeat on the macroeconomic outlook of the countries in which we operate, especially as the COVID-19 vaccine distribution gains traction globally, whilst commodity prices and currencies continue to stabilise. Our robust capital and liquidity positions have positioned us to continue to support our customers across diverse sectors and markets, guided by prudent risk management practices.”