Stock Market Hits 9-month High 

WEEKLY REPORT 

An unprecedented surge in   investors’ appetite for risk assets lifted the Nigerian equities market to nine-month high as the Nigerian Stock Exchange (NSE) All-Share Index (ASI) rose by 7.46per cent to close the week at 28,192.46. In a similar vein, market capitalisation gained N676billion to be at N9.746trillion.

It was a record breaking week with the NSE ASI posting the largest singular gain of 3.18per cent , since 15th of June 2016.

Analysts at Cordros  Capital Limited, an investment banking firm,  said judging by market activity in the past three weeks, and more specifically, the spike in the number of deals and volume traded last week, “we sense improved investors, both local and foreign, appetite for risk assets on domestic bourse, following the: reduced apprehension in the macroeconomic environment; impressive 2016 full year and first quarter (Q1) performance of highly capitalised names, and  increased confidence about the stability and liquidity of the foreign exchange (FX).

Apart from the ASI, that appreciated, all other indices finished higher during the week with the exception of the NSE ASeM Index that closed flat. 

Daily Market Performance

The stock market opened for trading in the week on a positive note, sustaining its bullish trend, following high demand for fast moving consumer goods, insurance and banking stocks.  Having gained 1.85 per cent last week, some level of profit taking was expected as trading resumed for the week yesterday. However, it appears investors are delaying their profit taking as bargain hunting remained high. Consequently, the NSE All-Share Index appreciated by 0.70 per cent to close at 26,418.33, while market capitalisation added N63.2 billion to close at N9.1 trillion.

Monday’s performance reduced the year-to-date decline to 1.70 per cent. The market recorded 26 price gainers, while 12 stocks depreciated.  Although bellwether stocks such as Nestle Nigeria Plc, Nigerian Breweries Plc, Zenith Bank Plc, GTBank Plc were among the price gainers, Oando Plc led the chart with 10.0 per cent, trailed by Seven-Up Bottling Company Plc with 9.7 per cent. Continental Reinsurance Plc and AIICO Insurance Plc chalked up 9.4 per cent and 7.5 per cent respectively among others.

Conversely, Champion Breweries Plc led the price losers with 4.6 per cent, followed by Jaiz Bank Plc with a decline of 4.5 per cent. African Prudential Plc and Dangote Flour Mills Plc shed 3.3 per cent and 2.3 per cent in that order.

In terms of sectoral performance,  all indices advanced except   the NSE Industrial Goods Index  that shed 0.02 per cent following price loss by  Cement Company of Northern Nigeria(-1.9 per cent). The NSE Consumer Goods Index recorded the highest gain (+2.0) on account of buy sentiment in Nestle (+3.4 per cent), Seven-Up Bottling Company Plc (+9.7 per cent) and Nigerian Breweries Plc (+2.7 per cent). Similarly, the NSE Insurance Index went up by 1.8 per cent  on the back of price appreciations in Continental (+9.4 per cent) and AIICO (+7.6 per cent) while the NSE  Oil & Gas and NSE  Banking indices appreciated 1.4 per cent and 0.4 per cent  respectively.

Following continuous bull run, the market rallied to a year high on Tuesday after gaining for the eight consecutive days.  Sustained demand lifted the NSE ASI by 1.28 per cent to close at year’s high of 26,756.21, while market capitalisation added N116.8 billion to be at N9.25 trillion. The gain was spurred mainly by demand for stocks such as  Oando Plc, Access Bank Plc, FBN Holdings Plc, Guaranty Trust Bank Plc, Dangote Cement Plc, Nigerian Breweries Plc and Zenith Bank Plc.

According to analysts at Meristem Securities Limited, the increased investors’ appetite witnessed may be traced to the streams of positive news inflow as regards companies’ performance and economic recovery.

“Whilst we do not rule of some profit-taking activities at the end of the week, we reiterate that the current positive trend may persist,” they stated.

The bulls visited 34 stocks, while only six stocks played host to the bears. Just like Monday, Oando Plc led the price gainers with 10.1 per cent, trailed by Fidson Healthcare Plc with 9.5 per cent. Transcorp Plc chalked up 7.1 per cent just as May & Baker Nigeria Plc, Portland Paints and Products, Cement Company of Northern Nigeria Plc and Access Bank  Plc appreciated by 5.9 per cent, 4.9 per cent, 4.8 per cent and 4.8 per cent in that order among others.

Conversely, Linkage Assurance Plc led the price losers with 3.7 per cent,   followed by Dangote Sugar Refinery Plc with 3.5 per cent. Total Nigeria Plc shed 2.3 per cent, just as Lafarge Africa Plc and Seven-Up Bottling Company Plc depreciated by 2.2 per cent and 1.8 per cent respectively.

 However, the value of stocks traded fell by 13.5 per cent to N2.815 billion, while volume rose by 101.4 per cent to 539.23 million shares. The three most actively traded sectors were Financial Services (488.45 million), Conglomerates (23.43 million) and Consumer Goods (9.78 million), while the three most actively traded stocks were: FCMB (243.86 million), Zenith Bank (52.29 million) and UBA (42.52 million).

Performance across sectors remained positive with three of the sectors appreciating, while only the NSE Industrial Goods Index, which dipped 0.3 per cent on account of profit-taking in Lafarge Africa.

 The NSE Banking Index led sector gainers, rising by 2.2 per cent, followed by the NSE Oil & Gas Index with 0.7 per cent growth.

The bulls tightened their hold on the Nigerian Bourse on Wednesday as investors continue to react to improving macroeconomic fundamentals, particularly the recent introduction of an autonomous FX market for investors and exporters. At the close of trade, the NSE ASI rose 2.9 per cent to reach a 6-month high of 27,546.68 while the year to date return  swung positive for the first time in the year to close at 2.5 per cent. Although the positive close was driven by broad-based buying interest across large, mid and small cap stocks, market bellwethers such as Dangote Cement, Nigerian Breweries, and Nestle supported performance. Investors gained N273.3 billion as market capitalisation advanced to N9.5 trillion.

In terms sectoral movement, on the NSE Industrial Goods Index fell by  0.9 per cent. The  NSE Banking Index  led with a gain of  4.1 per cent on the back of a broad-based rally in banking stocks across Tiers – Zenith (+5.6 per cent), GTBank (+2.4 per cent), UBA (+7.2 per cent), Fidelity Bank (+8.8 per cent) and Union Bank  (+3.0 per cent). The NSE Consumer Goods Index trailed with 3.6 per cent, while the NSE Oil & Gas Index added 2.4 per cent. The NSE Insurance Index closed higher by 0.7 per cent.

In line with expectation, the bullish run in the equities market continued on Thursday, rising by 3.2 per cent to close at 28,423.70. As with previous sessions, the positive performance was driven by rally across sectors, but was largely buoyed by gains in bellwethers such as Dangote Cement, Nigerian Breweries Plc and GTBank. 

Market Turnover

Meanwhile, investors traded 3.255 billion shares worth N28.738 billion in 25,370 deals, up from 1.154 billion shares valued at N10.439 billion that exchanged hands in 16,676 deals the previous week.

The financial services industry led the activity chart with 2.716 billion shares valued at N17.230 billion traded in 15,103 deals, thus contributing 83.4 per cent and 59.9 per cent to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 185.750 million shares worth N6.596 billion in 3,817 deals. The third place was occupied by Conglomerates Industry with a turnover of 156.010 million shares worth N385.427 million in 1,340 deals.

Trading in the top three Equities namely, FBN Holdings Plc, FCMB Group Plc and Zenith Bank Plc accounted for 1.419 billion shares worth N8.185 billion in 5,117 deals.

Also traded during the week were a total of 948 units of Exchange Traded Products (ETPs) valued at N16,591.16 executed in 14 deals compared with a total of 20 units valued at N110,000.00 transacted  the preceding week in one deal.

A total of 5,201 units of Federal Government Bonds valued at N5.400 million were traded last week in three deals, compared with a total of 1,582 units valued at N1.608 million transacted two weeks ago in 10 deals.

Price Gainers and Losers

The price movement chart showed 57 equities that appreciated , up from  43  equities of the previous week, while 13  equities depreciated compared with  16  equities of the previous week. May & Baker Nigeria Plc led the price gainers with 31.9 per cent. Ecobank Transnational Incorporated trailed with 22.5 per cent, just as Fidson Healthcare Plc and PZ Cussons Nigeria Plc appreciated by 20.4 per cent.

Oando Plc and Unity Bank Plc appreciated by 20.2 per cent and 20 per cent in that order, just as Eterna Plc, Diamond Bank Plc, Nigerian Breweries Plc and Transcorp Plc chalked up 17.8 per cent, 17.6 per cent, 17.1 per cent and 16.3 per cent respectively.

Conversely, Jaiz Bank Plc led the price losers, shedding 9.1 per cent, trailed by  Seplat with a decline of 5.8 per cent. Newrest ASL Nigeria Plc and Neimeth International Pharmaceuticals Plc went down by 5.6 per cent, 5.3 per cent and 4.8 per cent.

Other top price losers were: B.O.C Gases Plc, Trans-Nationwide Express Plc (4.8 per cent apiece); A-G Leventis Nigeria Plc (4.1 per cent); Lafarge Africa Plc (3.0 per cent); AIICO Insurance Plc (1.8 per cent0 and Learn Africa Plc (1.1 per cent).