NSE RoundUp! Nigerian equities buck global downtrend with N126bn gain

African equities were the major contrarian stocks in global downtrend that dominated trading in the immediate past week with Nigerian equities riding above negative hangover to close with net capital gain of N126 billion.

From America to Britain, Europe, Asia and Middle East, global equities largely on the negative in the immediate past week over concerns that fiscal and monetary changes in the major advanced markets could hamper trades and growths in other regions.

As demand for shares increased, Nigerian equities rode on the back of renewed bargain-hunting to record average week-on-week gain of 0.72 per cent. The modest gain pushed the average year-to-date return for Nigerian equities to 12.11 per cent. All benchmark indices at the Nigerian Stock Exchange (NSE) closed on the upside, a major contrast to downtrend in the global stock markets.

The All Share Index (ASI)-the common value-based index that tracks share prices at the Exchange, rose from the week’s opening index of 42,570.89 points to close the week at 42,876.23 points. Aggregate market value of all quoted equities also improved from the week’s value-on-board of N15.277 trillion to close the week at N15.403 trillion.

All sectoral indices closed positive with the exception of the NSE Banking Index which declined by 0.59 per cent on the back of profit-taking within the banking sector. The NSE Oil and Gas Index led with a week-on-week return of 1.64 per cent. The NSE Insurance Index followed with a gain of 1.50 per cent. The NSE Industrial Goods Index appreciated by 1.25 per cent. The NSE Consumer Goods Index posted a gain of 0.89 per cent while the NSE 30 Index-which tracks the 30 most capitalised companies, appreciated by 0.33 per cent. However, the NSE Banking Index declined by 0.59 per cent.

Total turnover increased to 2.170 billion shares worth N39.087 billion in 24,657 deals last week as against a total of 2.018 billion shares valued at N21.740 billion traded in 25,496 deals in the previous week. The financial services sector led the activity chart with 1.534 billion shares valued at N17.670 billion traded in 15,208 deals; thus contributing 70.69 per cent and 45.21 per cent to the total equity turnover volume and value respectively. The industrial goods sector followed with 200.405 million shares worth N6.436 billion in 1,097 deals while the conglomerates sector placed third with a turnover of 188.097 million shares worth N489.453 million in 998 deals.

Read also: NSE LIVE! Equities break into major rally with N370bn gain

The three most active stocks were FCMB Group Plc, Transnational Corporation of Nigeria Plc and Cement Company of Northern Nigeria Plc. Altogether, the three most active stocks accounted for 617.511 million shares worth N4.086 billion in 2,090 deals, contributing 28.46 per cent and 10.45 per cent to the total equity turnover volume and value respectively.

Also traded during the week were a total of 50,547 units of Exchange Traded Products (ETPs) valued at N4.593 million executed in 12 deals, compared with a total of 111,794 units valued at N1.806 million traded in 10 deals penultimate week.

In the sovereign debt market, a total of 6,574 units of Federal Government bonds valued at N6.332 million were traded in 31 deals compared with a total of 9,963 units valued at N10.057 million traded in 21 deals two weeks ago.

Further price movement analysis showed that there were 38 advancers against 45 decliners during the week compared with 23 advancers against 54 decliners recorded in the previous week. Eighty-nine equities remained unchanged last week as against 95equities that closed unchanged in the previous week.

Japaul Oil & Maritime Services recorded the highest gain-in percentage terms, with a gain of 50 per cent to close at 63 kobo. Unity Bank followed with a gain of 18.8 per cent to close at N1.77. NEM Insurance rose by 18.4 per cent to close at N2.25. Cement Company of Northern Nigeria gained 17.8 per cent to close at N19.85 while Consolidated Hallmark Insurance rose by 16 per cent to close at 29 kobo.

On the downside, Sovereign Trust Insurance led the decliners with a drop of 20.8 per cent to close at 38 kobo. UNIC Diversified Holdings followed with a loss of 18.5 per cent to close at 22 kobo. Multiverse Mining and Exploration declined by 17.8 per cent to close at 28 kobo. FTN Cocoa Processors dropped by 15.9 per cent to close at 37 kobo while African Alliance Insurance Company declined by 14.3 per cent to close at 36 kobo per share.

The performance of the Nigerian market appeared to reflect a shift to African emerging markets. Compared to other global markets, African equities were largely positive during the week. Kenya’s Nairobi Stock Exchange 20 Index rose by 1.7 per cent. Egypt’s EGX Index appreciated by 0.8 per cent while Ghana’s GSE Composite Index closed flat.

Global equities were however in red. In United States of America, the S &P 500 Index dropped by 2.5 per cent. The NASDAQ declined by 2.1 per cent while the Dow Jones Industrial Average dropped by 2.77 per cent. In United Kingdom, the UK FTSE Index dropped by 1.9 per cent. In Europe, Germany’s DAX Index slumped by 4.4 per cent. France’s CAC 40 slid by 2.9 per cent while the continental index- Euro Stoxx 50 Index declined by 3.02 per cent. In Asia, Japan’s Nikkei 225 Index dropped by 3.25 per cent. Hong Kong’s Hang Seng Index dipped by 2.2 per cent while the common index-CSI 300 Index dropped by 1.34 per cent.

In the emerging markets of Brazil, Russia, India, China and South Africa (BRICS), equities traded all through in negative. The MSCI EM Index-which tracks emerging markets, declined by 1.99 per cent. Brazil’s Ibovespa Index dropped by 2.9 per cent. Russia’s RTS Index declined by 3.3 per cent. India’s BSE Sens fell by 0.3 per cent. China’s Shanghai Composite Index dropped by 1.0 per cent while South Africa’s FTSE/JSE All share Index depreciated by 1.9 per cent.

Most analysts remained optimistic about the outlook for the Nigerian equities. With more corporate earnings and dividend recommendations expected in the new week, market pundits were almost unanimous that Nigerian equities will remain on the upswing in the days ahead.

“As more companies file full-year 2017 earnings results in the coming week, we expect investors to take position in fundamentally sound dividend paying stocks. Hence, we anticipate a largely positive performance in the coming week,” Afrinvest Securities stated on the outlook for this week.

Analysts at Cordros Capital said they expected increased returns at the stock market, “bolstered by investors positioning ahead of fourth quarter 2017 earnings releases, amidst still-positive macroeconomic fundamentals”.

 

 

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