By Chinwendu Obienyi
The Nigerian equities market closed the week on a bullish note as its All-share Index (ASI) appreciated by 1.1 per cent from 38,726.10 points to close at 39,156.28 points, with the market capitalization rising by N224 billion.
Analysts had predicted that transactions on the Nigerian Exchange Group (NGX)’s platform will be positive and in line with their expectations, sentiments remained broadly positive for the second consecutive week, as investors continued to cherry-pick stocks with attractive dividend yields ahead of the Half year (H1) of 2021 dividend declarations.
Analysis done by Daily Sun revealed that foreign investors’ interest in Okomu oil (+20.7 per cent) and bargain- hunting in Stanbic (+6.1 per cent), Flour mill (+5.3 per cent), Dangote Cement (+4.6 per cent) and Dangote Sugar (+4.4 per cent) spurred the weekly gain.
Consequently, the Month-to-Date (MTD) return print- ed 1.9 per cent, while the year-to-date (YTD) loss moderated to -2.8 per cent even as market capitalisation closed the week at N20.409 trillion.
Speaking on the resumption of proceedings on Tuesday, market experts say they expect to see some form of profit taking in early trades and advised investors to take positions in only fundamentally justified stocks.
Afrinvest, in their weekly assessment, said, “In the coming week, we expect to see profit-taking in early trades. However, we believe this will be short-lived before the end of the week on account of bargain hunting by investors.
For their part, analysts at Cordros capital, said, “We expect investors to continue cherry-picking stocks ahead of the H1-2021 dividend declarations. With the recent development in the FI market, we are approaching an inflexion point; we, therefore, see scope for increased buying interest from risk-averse investors. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings”.
Meanwhile, a total turnover of 1.058 billion shares worth N12.831 billion in 17,854 deals were traded this week by investors on the floor of the Exchange, in contrast to a total of 1.082 billion shares valued at N9.548 billion that exchanged hands last week in 17,933 deals.