Stock Market Gains N156bn on Renewed Investor Sentiment

WEEKLY REPORT

By Goddy Egene and Nosa Alekhuogie

It was another bullish week for equities investors as the market rode on the continued positive sentiments to gain  N156.2 billion. The market, which had previously recorded its highest weekly gain, rallied further last week on persistent investors’ positive reactions to first quarter (Q1) earnings  reported  by companies. The Nigerian Stock Exchange (NSE) All-Share Index (NSE ASI) rose by 1.85 per cent to close at 26,235.63, while market capitalisation appreciated by same margin to close higher at N9.069 trillion.

Similarly, all other Indices finished higher during the week with the exception the NSE Insurance and NSE Industrial Goods Indices that depreciated by 0.09 per cent and 1.04 per cent respectively while the NSE ASeM Index closed flat.

The  NSE Banking Index  appreciated by 3.6 per cent, followed by the NSE  Consumer Goods and NSE Oil & Gas Indices with 3.0 per cent apiece.

However, on the contrary, the Industrial Goods Index declined 1.1 per cent, just as the NSE Insurance Index recorded 0.1 per cent.

Analysts at Afrinvest said the market performance was driven by “swirls of positive sentiment, which emanated from the impressive Q1 earnings and expectations of a rebound in economic activities following positive PMI readings for April and improved FX liquidity.”

Daily Market performance

The market commenced the week and new month on a positive note on Tuesday as the NSE ASI appreciated by 0.80 per cent to close at 25,965.18.   The gain recorded could be attributed to the renewed investor sentiments witnessed in the market from last week, coupled with some impressive Q1:2017 earnings releases which drove the positive reactions. Specifically, sustained interest in market bellwethers such as Zenith Bank, Nestle Nigeria, Guaranty Trust Bank and Seplat contributed to the positive performance.

Performance across sectors was broadly positive as all indices closed in the green save for the NSE Industrial Goods Index which stagnated. The NSE  Banking Index appreciated the most, rising by  1.5 per cent due to  gain by Zenith Bank (+3.7 per cent) and GTBank (+1.4 per cent) while the NSE  Oil & Gas Index went up 1.4 per cent  followed gains by  Seplat  (+3.7 per cent) and Oando (+4.8 per cent). Similarly, the NSE Consumer Goods Index  and NSE  Insurance indices closed 0.9 per cent and  0.02 per cent higher on the back of rally in Nestle  (+2.5%) and WAPIC Insurance (+4.0 per cent)  in that order.

At the end of trading, 22 stocks added value compared with 12 decliners. The gainers’ chart was led by Fdison (+9.1 per cent), NPF Microfinance Bank (+9.1 per cent) and FBN Holdings Plc (+5.4%).

Conversely,   UACN of Nigeria Plc, Forte Oil Plc and AIICO Insurance shed 5.0 per cent,  4.2 per cent and 3.8 per cent respectively.

The market  appreciated further as the bulls  consolidated their hold on the market. The NSE ASI appreciated by 0.58 per cent to close at 26,116.79.  The appreciation recorded in the share prices of Zenith Bank, Nigerian Breweries, Access Bank, FBN Holdings and UBA were mainly responsible for the gain recorded in the Index.

Market performance was broadly bullish as all sector indices closed in the green. The  NSE Banking Index advanced the most, chalking up 1.5 per cent on the back of price appreciation in UBA (+6.3 per cent) and Zenith Bank (+1.6 per cent).

 The  NSE Oil & Gas Index  added  0.6 per cent on account of gains in Oando (+7.9 per cent) and Forte Oil(+2.3 per cent). Likewise, the NSE  Consumer Goods Index and Insurance indices trended northwards by adding  0.4 per cent and 0.3 per cent respectively. The  NSE  Industrial Goods Index closed  unchanged.

The  stock market recorded gains for the fifth consecutive trading session on Thursday  as investors continued to take position in large cap stocks on the exchange. Consequently, the NSE ASI  closed 0.20 per cent higher to settle at 26,166.80, reducing the year-to-date decline to 2.6 per cent. Also,  the market capitalisation added N18 billion to close at N9.Investors gained N18.0bn as market capitalisation rose to N9.0 5 trillion. The positive close was majorly driven by gains in Nigerian Breweries Plc, Zenith Bank and International Breweries Plc.

A total of 26 stocks advanced while 15 declined. International Breweries Plc led the price gainers with 9.3 per cent trailed by Fidson Healthcare with 9.1 per cent, while NAHCO appreciated by 4.8 per cent.

Conversely, Stanbic IBTC Bank Plc led the price losers with 9.6 per cent, while Unity Bank Plc shed 7.4 per cent. AXA Mansard Insurance Plc went down by 4.5 per cent.

  “Considering the positive momentum witnessed since the start of the week, we expect the market to close the week positive; however, we do not rule out the possibility of some “end of the week” profit-taking by investors in the trading session ahead,” analysts at Afrinvest (W.A) said.

The recorded its fourth consecutive gain on Friday adding 0.19 per cent to bring the total growth for the week to 1.85 per cent.

Market turnover

Meanwhile, investors traded 1.154 billion shares worth N10.439 billion in 16,676 deals , compared with 1.333 billion shares valued at N9.671 billion that exchanged hands  the previous week  in 16,300 deals.

The Financial Services Industry maintained its lead on the activity chart with 813.016 million shares valued at N6.904 billion traded in 10,298 deals; thus contributing 70.45 per cent and 66.13 per cent to the total equity turnover volume and value respectively. The Oil and Gas Industry followed with 106.566 million shares worth N1.063 billion in 1,356 deals.  The Services Industry  occupied the third position with  a turnover of 90.940 million shares worth N188.204 million in 660 deals.

 Also traded during the week were a total of 20 units of Exchange Traded Products (ETPs) valued at N110,000.00 executed in one deal compared with a total of 533 units valued at N32,204.30 transacted  in the preceding  week in 15 deals.

Similarly, a total of 1,582 units of Federal Government Bonds valued at N1.608 million were traded this week in 10 deals, compared with a total of 4,705 units valued at N3.934 million transacted two weeks   ago in four deals.

Price Gainers and Losers

The price movement chart showed 43 advancers higher than the 38  equities of the previous week, while 16  equities depreciated in price, lower than   25 equities of the previous week.

Fidson Healthcare Plc led the price gainers’ chart with 43.6 per cent. Oando Plc trailed with 24 per cent, while Livestock Feeds Plc appreciated by 16.2 per cent.

Nigerian Aviation Handling Company Plc, chalked up 15.2 per cent, just as Newrest ASL Nigeria Plc and  FBN Holdings Plc garnered 14.2 apiece. Other top price gainers were: May & Baker Nigeria Plc (14.1 per cent); Transcorp Plc (11.3 per cent); International Breweries Plc (10.4 per cent) and Cutix Plc (9.5 per cent).

Conversely, Unity Bank Plc led the price losers with 13.7 per cent, trailed by Champion Breweries Plc with 8.9 per cent decline. Stanbic IBTC Holdings Plc went down by 6.6 per cent, just as NASCON Allied Industries Plc and AXA Mansard Insurance Plc shed 5.7 per cent each.

Medview Airline Plc and Jaiz Bank Plc declined by 4.6 per cent and 4.3 per cent respectively. Others   were: Honeywell Flour Mills Plc (4.2 per cent); Sterling Bank Plc (4.1 per cent); and Total Nigeria Plc (3.04).