The momentum of the rally at the Nigerian stock market improved on Wednesday as investors sought to take advantage of several stocks that have crashed to their lowest levels in recent years.
Both turnover of activities and value-based indices showed increasing positive sentiments for quoted equities, with investors’ appetite particularly on low-priced stocks, otherwise known as penny stocks.
The benchmark index at the Nigerian Stock Exchange (NSE), the All Share Index (ASI)-a value-based common index that tracks prices of all quoted equities, rose by 0.64 per cent on Wednesday as against marginal gain of 0.02 per cent on Tuesday.
Aggregate market value of all quoted equities also rose by N53 billion from its opening value of N8.248 trillion to close at N8.301 trillion. The sustained uptrend over the past three days have helped to reduce the negative overhang with average year-to-date return now at -15.73 per cent.
With more gainers than losers, the market uptrend was being driven by widespread positive sentiments as investors sought to position for corporate earnings release and expected uptick in the second quarter. All sectoral indices, with the exception of the NSE Consumer Goods Index, closed on the upside.
Turnover was above recent average at 320.75 million shares valued at N1.82 billion in 3,186 deals. Low-priced equities dominated the top activity chart. FCMB Group led the table with a turnover of 102.67 million shares worth N100.49 million. Continental Reinsurance followed with a turnover of 39.51 million shares worth N38.72 million while Equity Assurance placed third with a turnover of 37.76 million shares worth N18.88 million.
“We believe recent uptrend remained driven by bargain hunting which might not be sustained given the prevailing macroeconomic headwinds. Nonetheless, we are also of the view that dividend investors can also benefit from current valuation by positioning in stocks with consistent dividend paying history ahead of full year earnings releases,” Afrinvest Securities, a Lagos-based dealer on the NSE, stated.
Seplat Petroleum Development Company led the 20-stock gainers’ list with a gain of N10 to close at N260. Mobil Oil Nigeria followed with a gain of N7.60 to close at N159.60. Dangote Cement rallied N2.03 to close at N135.99. Okomu Oil Palm added N1.41 to close at N29.40. Nigerian Breweries rose by 95 kobo to close at N97.01. Guaranty Trust Bank gathered 50 kobo to close at N16.90. Union Bank of Nigeria rose by 25 kobo to close at N5.30 while FBN Holdings chalked up 13 kobo to close at N3.91.
On the losers’ list, Seven-Up Bottling Company led 13 other stocks, dropping by N9.19 to close at N174.79. Nestle Nigeria declined by N5.02 to close at N700. Unilever Nigeria dropped by N1.67 to close at N31.76. GlaxoSmithKline Consumer Nigeria lost N1.15 to close at N22.01 while Conoil dropped by N1.01 to close lower at N19.24 per share.
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