By Chinwendu Obienyi and Chukwuma Umeorah
Fueled by recent developments in the foreign exchange (FX) landscape, bullish sentiments pervaded Nigeria’s stock market as investors’ demand for stocks pushed market capitalisation up N370 billion in one week.
Notably, the market recorded gains on all trading sessions, driven by increased demand for BUA Cement (+6.5 percent), FBN Holdings (+12.4 percent), and Seplat (+3.9 percent). The All-Share Index (ASI) advanced by 0.94 per cent week-on-week (w/w) to 70,854.18 points, resulting in Month-to-Date (MtD) and Year-to-date (YtD) returns of +2.3 per cent and +38.2 per cent). On the other hand, investors gained N368 billion as market capitalisation closed the week at N38.925 trillion from N38.557 trillion.
However, sectoral performances were mixed, with the Oil and Gas (+2.9 per cent), Industrial Goods (+2.7 per cenr), and Banking (+1.2 per cent) indices recording gains while the Consumer Goods index closed flat. The Insurance (-0.5 per cent) index was the sole loser in the week under consideration.
Trading activity levels reflected market optimism, as total traded volume and value increased by 3.3 per cent and 12.3 per cent w/w, respectively.
A total turnover of 2.451 billion shares worth N40.570 billion in 37,959 deals was traded this week by investors on the Exchange, in contrast to 1.446 billion shares valued at N25.418 billion that exchanged hands last week in 28,933 deals.
The Financial Services Industry (measured by volume) led the activity chart with 1.480 billion shares valued at N21.160 billion traded in 16,671 deals; thus accounting for 60.39 per cent and 52.16 per cent and the total equity turnover volume and value respectively.
The Oil and Gas Industry followed with 354.911 million shares worth N1.214 billion in 2,917 deals while the ICT Industry, with a turnover of 175.216 million shares worth N8.218 billion in 3,759 deals.
Trading in the top three equities namely Japual Gold & Ventures Plc, United Bank for Africa Plc and Fidelity Bank Plc (measured by volume) accounted for 835.584 million shares worth N8.631 billion in 5,514 deals, contributing 34.09 per cent and 21.27 per cent to the total equity turnover volume and value respectively.
Sixty-three securities appreciated in price during the week higher than 39 equities in the previous week.
Twenty-nine other securities depreciated in price and lower than 42 in the previous week, while 64 equities remained unchanged, lower than 76 recorded in the previous week.
Reacting to the performance, analysts noted that they expect the bears to book profit across most counters following the recent market rally.
“Consequently, we expect a “choppy theme” even as institutional investors search for clues on the direction of yields in the FI market. ;lNotwithstanding, we advise investors to take positions in only fundamentally justified stocks as the economy’s weak macro environment remains a significant headwind for corporate earnings,” analysts at Cordros Securities said.