Equities Market Rebounds on Bargain Hunting

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The Nigerian stock market rebounded last week following improved sentiments as more investors embarked on bargain hunting. The market had in the previous week closed on bearish note due to cautious trading by foreign investors and domestic as a result of the decision of Morgan Stanley Capital International (MSCI) to delete FBN Holdings, Forte Oil Plc, Guinness Nigeria Plc and PZ Cussons Nigeria Plc from its Main Frontier Markets Indexes. The MSCI main frontier market indexes track large and mid-cap stocks in the frontier universe.

Although all the changes will be implemented as of the close of market on November 30, 2017, foreign investors and most domestic institutional investors adopted cautious trading after the announcement.

Hence, the Nigerian Stock Exchange (NSE) All-Share Index shed 1.12 per cent. However, the negative trend was reversed last week as investors took advantage of low prices of stocks considered to be having strong fundamentals.

As a result, the NSE ASI appreciated by 1.8 per cent to close higher at 37,365.91, while market capitalisation rose by 1.84 per cent or N234.9 billion to close the week at N13.009 trillion.
In a similar way, all other indices finished higher during the week with the exception of the NSE Oil/Gas Index that depreciated by 1.45 per cent.

Daily Market Performance
The Nigerian equities market opened for the week on a bullish note as investors reacted to the positive Gross Domestic Product (GDP) growth rate in the third quarter (Q3) 2017. The country’s GDP grew by 1.40 per cent in Q3, 2017 higher than the revised growth rate of 0.72 per cent recorded in Q2, 2017.

Buoyed by the positive news, investors increased demand for stocks. Consequently, the NSE ASI by 0.24 per cent to close at 36,792.60, while market capitalisation closed higher at N12.81 trillion. The appreciation recorded in the share prices of FBN Holdings, Nestle, PZ Cussons, UBA, and Zenith Bank was mainly responsible for the gain.

In all, 17 stocks appreciated, while 15 depreciated. PZ Cussons led the price gainers with 10.2 per cent, trailed by NASCON Allied Industries Plc with 9.5 per cent. Eterna Plc rose by 4.7 per cent, just as Diamond Bank Plc, NEM Insurance Plc Chalked up 4.5 per cent. Dangote Sugar Refinery Plc and May & Baker Nigeria Plc garnered 4.3 per cent and 3.5 per cent respectively among others.

Conversely, Forte Oil Plc led the price losers with 9.7 per cent, trailed by Law Union & Rock Insurance Plc with 4.6 per cent. Unity Bank Plc shed 3.7 per cent, while Learn Africa Plc went down by 2.0 per cent.

However, the total value of stocks traded went down by 61 per cent to N2.45 billion invested in 208.70 million shares in 2,993 deals, down from N6.31 billion last Friday. The three most actively traded sectors were: Financial Services (175.47 million shares), Consumer Goods (21.42 million shares), and Conglomerates (5.63 million shares), while the three most actively traded stocks were: Custodian and Allied Insurance (40.45 million shares), FBN Holdings Plc (27.45 million shares) and Fidelity Bank (23.46 million shares)
In terms of sectoral performance, across sectors was broadly positive as three of the five indices closed northwards, while one declined another one was flat.

The NSE Banking Index and NSE Consumer Goods Index appreciated 0.5 per cent apiece. Similarly, the NSE Insurance Index gained, inching 0.4 per cent higher. On the flip side, the NSE Oil & Gas Index was the lone loser, shedding 1.1 per cent.
The market reversed the gains recorded the first day as the index depreciated by 0.52 per cent to close at 36,600.07. Decline in the shares of FBN Holdings, Nigerian Breweries, PZ Cussons, GTBank, and Zenith Bank contributed to the negative performance recorded on that day.

The total value of stocks traded on Tuesday stood at N3.29 billion invested in 257.92 million shares in 3,423 deals. The three most actively traded sectors were: Financial Services (158.85 million shares), Services (49.52 million shares), and Consumer Goods (36.44 million shares). On the other hand, the three most actively traded stocks were: Tantalizers (43.81 million shares), Fidelity Bank (35.38 million shares) and FCMB Group (29.73 million shares)

Sectoral performance was broadly negative with three of the five major indices closing in the red. The NSE Banking Index led losers, down 1.2 per cent, trailed by the NSE Oil & Gas Index that fell 0.9 per cent. Similarly, the NSE Consumer Index fell by 0.7 per cent, while the NSE Insurance Index and the NSE Industrial Goods Index closed flat.

On Wednesday the market recorded a marginal growth of 0.02 per cent to close at 36,608.76. . Accordingly, market capitalisation increased by N7.3 billion to N12.8 trillion, buoyed by gains in Nestle, Zenith Bank, Unilever, Access Bank and GTBank among others.
In a similar vein, activity level improved as volume and value traded advanced 28.4 per cent and 68.9 per cent to 331.2 million units and N5.6 billion respectively.

The three most actively traded sectors were: Financial Services (248.31 million shares), Services (46.08 million shares), and Consumer Goods (13.56 million shares), while the three most actively traded stocks were: Union Bank (70.73 million shares), Custodian and Allied (55.17 million shares) and Tantalizers (43 million shares)
The market appreciated further on Thursday as the index rose by 0.22 per cent to close at 36,688.75.The appreciation recorded in the share prices of International Breweries, FBN Holdings, Access Bank, UBA, and Zenith Bank was mainly responsible for the gain recorded in the index.

Performance across sectors was broadly bullish. First on the gainers chart was the NSE Banking Index, up 0.8 per cent followed by the NSE Oil & Gas Index that added 0.5 per cent. The NSE Consumer Goods Index added 0.4 per cent, just as the NSE Insurance Index closed 0.2 per cent higher. Conversely, the NSE Industrial Goods Index was the lone loser, declining 0.05 per cent.

Market Turnover
In terms of equity turnover for the week, a total of 2.182 billion shares worth N22.795 billion were traded in 17,019 deals, compared with 2.804 billion shares valued at N54.776 billion that exchanged hands two weeks ago in 17,792 deals.

As usual, the Financial Services Industry led the activity chart with 1.755 billion shares valued at N11.571 billion traded in 8,730 deals, thus contributing 80.44 per cent and 50.76 per cent to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 178.154 million shares worth N8.655 billion in 4,457 deals. The third place was occupied by Services Industry with a turnover of 143.821 million shares worth N92,479 million in 470 deals.

Also traded during the week were a total of 127 units of Exchange Traded Products (ETPs) valued at N13, 837.30 executed in five deals compared with none the previous week.
A total of 9,024 units of Federal Government Bonds valued at N9.485 million were traded this week in 15 deals, compared with a total of 5,950 units valued at N6.247 million transacted the preceding week in two deals.

Price Gainers and Losers
Meanwhile, 36 equities appreciated in price last week, higher than the 20 of the previous week, while 24 equities depreciated in price. Dangote Sugar Refinery Plc led the price gainers with 20.3 per cent, trailed by Linkage Assurance Plc with 14.3 per cent. International Breweries Plc appreciated by 11.9 per cent, just as N.E.M Insurance Plc and Unilever Nigeria Plc chalked up 9.7 per cent and 9.1 per cent respectively.

Nigerian Aviation Handling Company Plc went up by 8.0 per cent, while Neimeth International Pharmaceuticals Plc garnered 7.0 per cent. Other to price gainers included: Custodian and Allied Plc (6.6 per cent); Eterna Plc (6.3 per cent) and Fidelity Bank Plc (6.2 –per cent).

Conversely, Forte Oil Plc led the price losers with 17.7 per cent, trailed by Glaxosmithkline Consumer Nigeria Plc with 8.6 per cent. C & I Leasing Plc and UACN Property Development Company Plc shed 7.6 per cent and 6.2 per cent in that order.
Other top price losers were: Nigerian Breweries Plc (6.2 per cent); Law Union & Rock Insurance Plc (6.1 per cent); Unity Bank Plc (5.6 per cent); Caverton Offshore Support Group Plc (5.3 per cent); Julius Berger Nigeria Plc (4.5 per cent) and Cement Company of Northern Nigeria Plc (3.2 per cent).