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By Chinwendu Obienyi
Following an earlier than expected reversal in fixed income yields, market analysts have said they expect a more robust market recovery post half year (H1) of 2021.
This is coming after the bearish sentiment continued to dictate proceedings in the local bourse as the market suffered its fifth consecutive weekly loss (1.2 per cent) last week amid growing concerns about the direction of yields in the Fixed Income (FI) market.
In an emailed note to Daily Sun, analysts at Cordros Securities, said with the current situation in the market, investors will remain reluctant to leave gains in the market, adding that they expect intermittent profit-taking to continue due to uncertainties about the direction of yields in the FI market. Citing key factors which changed their initial perspective regarding market performance in 2021, the analysts revised their base case estimate for market return in 2021 downwards to 8.8 per cent (previously: +12.8 per cent). “Over the rest of H1 2021, we believe the interplay between corporate actions and yield elevation in the FI will continue to shape market performance. As a result, we expect a choppy market, albeit with a bearish bias, as investors remain increasingly reluctant to leave gains in the market.
