NSE’s Capitalisation Gains N801bn as Market Recovers Further

By Goddy Egene

The stock market recovered further last week as more investors took advantage of the low prices to increase their portfolios. Having gained N150 billion the previous week, the market capitalisation of the Nigerian Stock Exchange (NSE) soared by N801.3 billion to close at N11.946 trillion. Similarly, the NSE All-Share Index (ASI) jumped by 7.19 per cent to close at 22,921.59.

Some operators said the gained recorded by the market last week was unexpected considering the risks in the market presently.

For instance, analysts said: “This week’s performance was surprising, given that risks remain on the horizon following the increasing number of COVID-19 cases in Nigeria. Nonetheless, we note that the market performance was buoyed by fundamentally justified stocks and therefore advise again, that investors trade cautiously.”

Following the positive performance, the year-to-date (YTD) loss improved to 14.6 per cent.

All the sectors tracked closed in the green territory led by the NSE Consumer Goods Index that gained 15.6 per cent. The NSE Industrial Goods Index went up by 5.2 per cent, while the NSE Banking Index gained 4.7 per cent. The NSE Oil & Gas Index added 1.5 per cent, while the NSE Insurance Index appreciated 0.8 per cent. Just the Nigerian market, Kenya recorded a positive impressive performance last week with the Kenya’s NSE 20 gaining 0.3 per cent.

However, the Mauritius SEMDEX and Morocco’s Casablanca MASI indices fell 3.9 per cent and 2.3 per cent. Similarly, Egypt’s EGX 30 declined by 1.6 per cent, while Ghana’s GSE Composite recorded shed 0.04 per cent.

In the BRICS market, performance was bullish as four of five indices tracked went up. South Africa’s FTSE/JSE All share index led the gainers, up 2.3 per cent, followed by China’s Shanghai Composite with a gain of 1.5 per cent. In India, the BSE Sens gained 1.4 per cent just as Brazil’s Ibovespa appreciated by 1.1 per cent. On the contrary, Russia’s RTS shed 5.5 per cent.

Performance in Asia and the Middle East was bearish as only two of five markets tracked went up. Thailand’s SET and Turkey’s BIST 100 indices led the pack, with gains of 0.9 per cent and 1.8 per cent in that order. On the negative side, the Oil dependent markets -Saudi Arabia, Qatar and UAE shed 5.3 per cent, 4.6 per cent and 3.5 per cent respectively following failure of oil prices to rebound despite the supply cut decision.

“ In the coming week(this week), we expect news around the COVID-19 pandemic and as well as economic recovery plans to shape the direction of global financial markets,” Afrinvest (West Africa) said.

But performance across the developed markets was positive as five of seven indices advanced. In the United States markets, the S&P 500 and NASDAQ advanced 1.6 per cent and 5.3 per cent respectively. Similarly, Hong Kong’s Hang Seng and Japan’s Nikkei 225 indices gained 0.3 per cent and 2.0 per cent respectively, while the German XETRA DAX index advanced 0.3 per cent. Conversely, United Kingdom’s FTSE All-Share and France’s CAC 40 indices fell 1.7 per cent and 0.5 per cent in that order.

Market turnover

Meanwhile, investors traded 1.495 billion shares worth N12.894 billion in 20,982 deals last week, compared with 2.440 billion shares valued at N19.932 billion that exchanged hands last week in 18,918 deals. The Financial Services industry maintained its lead the activity chart with 1.238 billion shares valued at N8.424 billion traded in 12,835 deals, thus contributing 82.82 per cent and 65.33 per cent to the total equity turnover volume and value respectively.

The Healthcare industry followed with 72.953 million shares worth N386.138 million in 465 deals. The third place was the Consumer Goods industry, with a turnover of 48.567 million shares worth N1.904 billion in 2,611 deals.

Trading in the top three equities namely, Omoluabi Mortgage Bank Plc, FBN Holdings Plc and Zenith Bank Plc accounted for 755.096 million shares worth N4.584 billion in 5,758 deals.

Top price gainers and losers

Meanwhile, 37 stocks appreciated last week higher than 35 equities in the previous week, while 21 equities depreciated also higher than 18 stocks in the preceding week.

Nigerian Breweries Plc led the price gainers with 45.7 per cent, trailed by Conoil Plc with a gain of 32.3 per cent. Champion Breweries Plc chalked up 20 per cent, just as May & Baker Nigeria Plc went up by 18.6 per cent. Nestle Nigeria Plc garnered 16.4 per cent, while Dangote Cement Plc closed 15.4 per cent higher.

Dangote Sugar Refinery Plc and Neimeth International Pharmaceuticals Plc appreciated by 15.4 per cent and 15.3 per cent respectively. Glaxosmithkline Consumer Nigeria Plc and Unity Bank Plc went up by 14.8 per cent and 14.2 per cent in that order.

Conversely, Nigerian Aviation Handling Company Plc led the price losers with 11.2 per cent. Ardova Plc with 10.2 per cent, trailed by Arbico Plc with 9.8 per cent.

John Holt Plc shed 8.9 per cent, just as Cadbury Nigeria Plc shed 8.7 per cent.

Lafarge Nigeria Plc lost 8.3 per cent as investors locked in profit after the stock gained over 41.3 per cent the previous week following investors’ positive reaction to the company’s 2019 results.

Lafarge had posted a profit after tax of N15.5 billion in 2019, up from a loss of N8.1 billion in 2018. The cement manufacturing firm recorded a revenue of N213 billion in 2019, as against N218 billion in 2018.Operating expenses were reduced from N29.89 billion to N23.42 billion. The company ended the year with a profit after tax of N15.5 billion compared with a loss of N8.1 billion in 2018. Based on the positive performance, the board has recommended a dividend of 100 kobo per share.

The Chief Executive Officer of Lafarge Africa Plc, Mr. Khaled El Dokani, said: “Our turnaround and cost-reduction strategy in 2019 and the divestment of the South African business, have delivered strong results. The decrease in net debt has significantly strengthened our balance sheet and has placed us in a vantage position to face the future.”

FCMB Group Plc was also among the price loser, losing 6.4 per cent. Wema Bank Plc shed 5.0 per cent, just as Cutix Plc and AIICO Insurance Plc went down by 4.7 per cent apiece.

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