NSE Index Sheds 3.4% to Profit Taking

WEEKLY REPORT 

The stock market recorded its first weekly fall last week after five consecutive weeks of bullish.  The market succumbed to profit taking activities leading to a decline of 3.35 per cent in the Nigerian Stock Exchange (NSE) All-Share Index at 36,920.56.

Following five weeks of gains that lifted the market to a 34-month high the previous week, profit taking on previous gains recorded in the market was imminent. Hence, the market resumed for the week on bearish note on Monday, which lasted till Wednesday.

However, the negative performance was bucked on Thursday, helped by gains in Dangote Cement Plc, following news of a regulatory approval of the sale of shares in the company by Dangote Industries Limited to foreign investors.

Although the market appreciated two days, the gains were not enough to offset the losses posted in three days. Consequently, the market ended with a decline of 3.35 per cent.  Performance across sectors was broadly bearish, led by the NSE Industrial Goods Index with 6/02 per cent, while the NSE Consumer Goods Index  shed 2.7 per cent.

The NSE Oil & Gas Index, NSE Insurance Plc and NSE Banking Index closed 2.3 per cent, 1.01 per cent and 0.45 per cent respectively. 

Daily Market Performance

Following investors’ move to take profit on stocks that have recorded  significant capital gains in past weeks, trading at the Nigerian equities market resumed on a bearish note on Monday.

The market  depreciated by 0.65 per cent to close lower at 37,950.96, while market capitalisation shed N85.4 billion to be at N13.08 trillion.

A total of 27 stocks depreciated while 18 appreciated.  But the negative performance mostly resulted from bearish sentiments towards Dangote Cement Plc, the stock that controls about 30 per cent of the market capitalisation.

Reacting to the performance of the market on the first day of the week, analysts at Meristem Securities Limited said: “Bearish sentiments dominated the equities market in the day, as investors took profit on stocks that have appreciated in recent times particularly the large cap banking stocks. We expect a similar trend in the remaining trading days of the week.”

C & I Leasing Plc led the price losers’ table with 9.2 per cent, trailed by Total Nigeria Plc and Med-View Airline Plc with 5.0 per cent apiece. May & Baker Nigeria Plc and Flour Mills of Nigeria Plc declined by 4.8 per cent, just as Neimeth International Pharmaceuticals Plc and Jaiz Bank Plc  closed 4.7  per cent lower each. N.E.M Insurance Plc and Nigerian Aviation Handling Company Plc went down by 4.5 per cent and 4.3 per cent in that order.

Fidson Healthcare Plc led the stocks that recorded gains with 4.6 per cent, followed by A.G Leventis Plc with 4.3 per cent. Linkage Assurance Plc added 4.0 per cent, just as Union Bank of Nigeria Plc, Unity Bank Plc and Dangote Flour Mills Plc garnered  3.9 per cent, 3.4 per cent and 3.2 per cent respectively among others.

Apart from the indeed that fell, the  volume  and value of transactions  also declined by 10.6 per cent and 32.9 per cent in that order. Investors traded 316.122 million shares worth N4.224 billion in 4,113 deals compared with 353.645 million shares valued at N6.301 billion exchanged in 4,079 deals last Friday.

The three most actively traded sectors were:  Financial Services (282.61 million shares), Consumer Goods (11.61 million shares), and Conglomerates (9.51 million shares), while the three most actively traded stocks were: Access Bank (169.66 million shares), GTBank (26.17 million shares) and FBN Holdings (17.79 million shares).

The market depreciated further on Tuesday, falling by 2.25 per cent  to close at 37,096.60, while capitalisation close lower at N12.79 trillion. The depreciation recorded in the share prices of Dangote Cement, Lafarge Africa, Stanbic IBTC, Nigerian Breweries, and FBN Holdings was mainly responsible for the loss recorded in the index.

Investors staked N5.44 billion on 391.63 million shares in 5,285 deals. The most actively traded sectors were:  The three most actively traded Financial Services (348.05mn), Consumer Goods (15.76 million shares), and Conglomerates (10.44 million shares), while the three most actively traded stocks were: Access Bank (179.30 million shares), Zenith Bank  (40.14 million shares) and UBA (24.88 million shares).

In the bearish trend, performance across sectors was largely bearish as all indices closed in the red. The  NSE Industrial Goods Index fell  4.2 per cent owing to a decline in the price of Dangote Cement  (-4.3 per cent),followed by the NSE Banking Index shedding 1.2 per cent on account of losses recorded by  Stanbic IBTC and GTBank. Similarly, the   NSE Insurance Index and NSE Consumer Goods Index dipped 1.0 per cent apiece. The NSE Oil & Gas Index shed 0.4 per cent.

Wednesday witnessed a further decline in the market with the index falling  by 2.68 per cent  to close lower at 36,102.38 as profit taking persisted on the bourse.

At the close trading on Monday, 31 stocks depreciated while only 10 stocks appreciated.   The depreciation recorded in the share prices of Dangote Cement, Lafarge Africa, GTBank, Nigerian Breweries, and Stanbic IBTC was mainly responsible for the loss recorded in the index.

However, Jaiz Bank Plc led the losers’ table with 5.0 per cent, trailed by Access Bank Plc, FCMB Group, Stanbic IBTC Holdings Plc  that went down by  4.9 per cent apiece. Dangote Cement fell by 4.8, while Cutix Plc, just as May & Baker Nigeria Plc ND Livestock Feeds Plc lost 4.7per cent each.

Even Guaranty Trust Bank Plc, which declared an interim dividend of 30 kobo on Tuesday, was not spared in profit taking, as it fell by 4.6 per cent to close at 37.10 per share.

GTBank  recommended an interim dividend of 30 kobo, which is higher than the 25 kobo paid in the corresponding period of 2016 after  recording a profit after tax of N83.6 billion. The PAT showed an increase of 16 per cent from the N71.7 billion posted in the corresponding period of 2016.

Commenting on the performance, the Managing Director/CEO of GTBank Plc, Mr. Segun Agbaje, said:  “Our strong performance in the first half of 2017 reflects the strength of our businesses, the quality of our past decisions and the success of our efforts towards becoming a digital-first customer-centric Bank that offers simple and easily accessible products and services.”

However, after three days of decline,  the  equities market rebounded as the index appreciated by 0.59 per cent to close at 36,316.58, while  market capitalisation climbed to N12.52 trillion.

 The appreciation recorded in the share prices of Dangote Cement, Zenith Bank, FBN Holdings Plc, Dangote Sugar, and Total Nigeria Plc propelled the rebound.

The total value of stocks traded on Friday was   N5.48 billion invested in 225.14 million, up by 7.64 per cent  from N5.09 billion invested the previous day.

The three most actively traded stocks were: Custodian and Allied Insurance (30.30mn),  Zenith Bank  (25.96mn) and GT Bank (24.72mn)

 

Market Turnover

Meanwhile, the market recorded a turnover of 1.394 billion shares worth N25.037 billion in 23,133 deals   in contrast to a total of 1.518 billion shares valued at N28.868 billion that exchanged hands the previous week in 23,053 deals.

The Financial Services Industry remained the most activity led the activity with 1.185 billion shares valued at N15.073 billion traded in 13,728 deals, thus contributing 84.9 per cent and 60.2 per cent to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 90.576 million shares worth N7.384 billion in 4,687 deals. The third place was occupied by Conglomerates Industry with a turnover of 40.906 million shares worth N87.613 million in 796 deals.

Trading in the top three equities namely, Access Bank Plc, Zenith Bank Plc and Guaranty Trust Bank Plc, accounted for 655.596 million shares worth N12.182 billion in 4,881 deals, contributing 47.02 per cent and 48.65 per cent to the total equity turnover volume and value respectively.

 

 

Price Gainers and Losers

The price movement chart showed that 19 equities appreciated in price during the week, lower than 32 equities of the previous week, while 51 equities depreciated in price as against 37 equities of the previous week. Fidson Healthcare Plc led the price gainers with 9.7 per cent, trailed by Continental Reinsurance Plc with 6.5 per cent.

University Press Plc appreciated by 6.3 per cent, while Berger Paints Nigeria  and Glaxosmithkline  Consumer Nigeria Plc  garnered 5.0 per cent apiece.

Other top price gainers included: Golden Guinea Breweries Plc (4.7 per cent); Prestige Assurance Plc (4.0 per cent); Conoil Plc, Union Bank of Nigeria Plc  (3.9 per cent apiece) and Zenith Bank Plc (3.2 per cent).

Conversely, Cement Company of Northern Nigeria Plc led the price losers with 13.9 per cent, followed by   N.E.M Insurance Plc with 12.7 per cent. Jaiz Bank Plc shed 9.5 per cent, just as Total Nigeria Plc and Morison Industries Plc went down by 8.3 per cent and 8.1 per cent respectively. Other top price losers included: Nigerian Aviation Handling Company Plc (8.1 per cent); Cutix Plc (7.4 per cent); UACN  Property Development Company Plc, Forte Oil Plc(7.4 per cent each); and Guinness Nigeria Plc (7.1 per cent).