Equities Market Rallies on  Portfolio Rebalancing

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WEEKLY REPORT

The stock market closed the last week of 2016 on a positive note, rising by 1.47 per cent.  Although the market opened for only three days, the bullish trend that has started in December was sustained last week as fund managers rebalanced their portfolios while oil and gas stocks also rallied.  Consequently, the Nigerian Stock Exchange  (NSE) All-Share Index (NSE) ASI closed 1.47 per cent higher at 26,874.62, while market capitalisation rose by the same margin to be at N9.247 trillion.

Similarly, all other indices finished higher during the week with the exception of the NSE ASeM, NSE  Oil/Gas and NSE Industrial Goods Indices that went down by  2.35 per cent, 1.47 per cent and 0.15 per cent respectively.

Daily Market Performance
Trading at the stock market  had resumed on a positive on Wednesday  after the two days holiday declared by the federal government to market the celebtration of Christmas.  The NSE ASI rose by 0.76 per cent to close higher at 26, 688.25 , just as the market capitalization of equities appreciated by same margin to be at N9.11 trillion.

The market had remained bearish for most part of the year and was heading for a third consecutive yearly decline. However, the 0.76 per cent recorded  on Wednesday  reduced the year-to-date decline to 6.82 per cent.
The appreciation recorded in the share prices of Union Bank, Transcorp, Access Bank, Stanbic IBTC and Nigerian Breweries were mainly responsible for the gain recorded in the NSE ASI yesterday.

Investors staked N1.25 billion on 131.74 million shares, down by 12.92 per cent from N1.43 billion invested the previous trading day.
The three most actively traded stocks were: International Breweries (16.2 million shares), Transcorp (12.42 million shares) and FCMB Group (11.65 million shares), while the most traded sectors were: Financial Services (78.42 million shares), Consumer Goods (19.29 million shares) and Conglomerates (12.92 million shares).
In terms of sectoral performance, as all sector indices closed in the green except the NSE  Industrial Goods Index which declined  by 0.02 per cent owing to price drop by Lafarge Africa Plc.

However, the NSE  Consumer Goods Index (+1.5 per cent) led sector gainers, driven by the significant appreciation in Nigerian Breweries Plc (+3.3 per cent), Cadbury Nigeria  (+8.0 per cent) and Honeywell Flour Mills Plc (+4.9 per cent).
Nigerian Breweries Plc recently got commendation from the  Chief Executive Officer of the NSE, Mr. Oscar Onyema  its commitment to corporate governance standards. The NSE boss also  congratulated the company on its 70th anniversary and for winning the Most Compliant Listed Company award for the year.

He disclosed that Nigerian Breweries was qualified to join the exchange’s Premium Board, the listing segment for the elite group of issuers that meet the exchange’s most stringent corporate governance and listing standards.
The equity market maintained its upward trend on Thursday with the NSE ASI rising by 0.35 per cent to close at 26,782.93 points.  GTBank, Total Nigeria, Union Bank, Seplat and Zenith Bank recorded gains that contributed to the positve performance of the market.
The total value of stocks traded on fell to  N878 million, down by 29.66 per cent from N1.25 billion  recorded  the previous day while the  total volume of stocks traded was 117.4 million in 2,392 deals.

Similar to the performance of the broader index, sector performance was largely bullish with the  NSE Oil & Gas Index (-0.5 per cent) recording the only decline as sell pressure in Forte Oil (-9.5 per cent) and Oando  (-0.9 per cent) weighed on the index performance to offset gains in Seplat  (+2.6 pe cent). However,  the NSE Banking rose by 2.2 per cent on gains by GTBank(+5.8 per cent), Zenith (+1.4 per cent) and Union Bank (+3.7 per cent). Similarly,  the NSE Insurance Index appreciated by 1.8 per cent following gains booked by AIICO Insurance, NEM Insurance and Law Union and Rock Insurance.

Also the NSE Consumer Goods Index rose  0.34 per cent on the back of positive sentiment towards Dangote Flour  (+4.6 per cent) and PZ (+1.8 per cent).
The market  recorded a positive performance on the last trading day of the year as  gains in Consumer Goods and Banking large caps – Nigerian Breweries (+4.2 per cent), Guinness (+3.8 per cent) and Access Bank  (+1.6 per cent) – boosted the market performance.
Specifically, the NSE ASI closed the year at 26,874.62, while the market Capitalisation ended at N9.25trillion.
Market turnover
Meanwhile, a total turnover of 405.939 million shares worth N3.724 billion in 6,363 deals were traded  last week by investors, down  from  1.261 billion shares valued at  N17.520 billion that exchanged hands  the previous week  in 14,861 deals.
The Financial Services Industry  led the activity chart with 305.885 million shares  valued at N2.066 billion traded in 3,445 deals; thus contributing 75.35 per cent and 55.46 per cent to the total equity  turnover volume and value respectively. The Consumer Goods Industry followed with 30.974 million
shares worth N793.114 million in 1,096 deals. The third place was occupied by Conglomerates Industry  with a turnover of 19.701 million shares worth N24.689 million in 261 deals.

Trading in the top three equities namely – Omoluabi Savings and Loans Plc, Guaranty Trust Bank Plc  and FCMB Group Plc accounted for 128.546 million shares worth N1.222 billion in
715 deals,  contributing 31.66 per cent and 32.82 per cent to the total equity turnover volume and value respectively.
Also traded during the week were a total of 9,965 units of Exchange Traded Products (ETPs) valued at  N56,446.35 executed in 16 deals, compared with a total of 10,170 units valued at N123.641.70  transacted  the previous week  in 22 deals.

There was no bond transaction last week, compared with a total of 25,219 units of Federal Government and Corporate Bonds valued at N24.458 million were transacted  the preceding week in three deals.
Price gainers and losers
On the price movement chart, 37 equities appreciated last week, higher than 26 equities the previous week. Twenty-one  equities depreciated in price, lower than  the 36 equities of the previous week, while 117  equities remained unchanged higher than 113 equities recorded in the preceding week.
NAHCO led the price gainers with 23.4 per cent, trailed by Law Union and Rock Insurance Plc with 19.4 per cent. NEM Insurance Plc rose by 19.3 per cent, just as Union Bank of Nigeria Plc, UACN Property Development Company Plc and University Press Plc chalked up 17 per cent, 14.9 per cent and 14.9 per cent.

Other top price gainers include: A.G Leventis (Nigeria) Plc(14.3 per cent); NASCON Allied Industries Plc(12.5 per cent); Ashaka Cement Plc(9.2 per cent).
Conversely, Forte Oil Plc led the price losers, shedding  18.7 per cent, trailed by Sterling Bank Plc with a decline of 19.4 per cent. Portland Paints and Products Plc shed 9.0 per cent. ETI went down by 5.5 per cent, just as Unity Bank Plc and Ekocorp Plc  lost 5.1 per cent and 4.7 per cent respectively. Beta Glass Plc, Juli Plc and Fidelity Bank Plc shed 4.7 per cent, 4.5 per cent and 4.3 per cent respectively.