Nigerian equities sustained an all-week rally to haul a net capital gain of N277 billion at the weekend as investors showed stronger appetite for equities across the world.
With increased momentum of activities, investors in the Nigerian equities market traded mostly in the seller’s market, with transaction prices closing on premium.
Benchmark indices at the Nigerian Stock Exchange (NSE) indicated average week-on-week gain of 2.47 per cent, equivalent to net capital gain of N277 billion within the five-day trading week. Turnover volume rose by 19.9 per cent while turnover value and number of deals increased by 13.8 per cent and 2.85 per cent.
The price appreciation and increased momentum of activities underlined improved investors’ appetite for Nigerian equities as quoted companies started to release their half-year results for 2017. Nearly 90 per cent of quoted companies are expected to release their half-year 2017 results by the end of this month, according to the extant rules at the Exchange.
The sustained rally was apparently fuelled by early positioning for the results by bargain-hunters. Across the sectors, investors showed considerable interest in blue chips and mid-cap stocks, which are expected to declare interim dividends or post reassuring earnings.
The All Share Index (ASI)-the benchmark price index for the Nigerian equities market, rose from the week’s opening index of 32,459.17 points to close the week at 33,261.66 points. Aggregate market value of all quoted equities also rose from the week’s opening value of N11.187 trillion to close the week at N11.464 trillion. With the sustained rally, the average year-to-date return for Nigerian equities climbed to 23.77 per cent at the weekend.
The performance of Nigerian equities was largely in line with global equities performance as share prices rose across Europe, America, Asia and other African countries. The United Kingdom’s FTSE Index rose by 0.7 per cent. United States of America’s twin indices- S & P 500 and NASDAQ rose by 0.8 per cent and 1.8 per cent respectively. France’s CAC 40 Index appreciated by 1.8 per cent. Germany’s XETRA DAX Index rose by 1.9 per cent. Japan’s NIKKEI Index posted a gain of 0.9 per cent. Hong Kong’s HANG SENG Index returned above average gain of 4.0 per cent. Brazil’s IBOVESPA Index appreciated by 4.4 per cent. Russia’s RTS Index rose by 1.1 per cent. India’s BSE Index increased by 2.2 per cent while China’s Shanghai Composite Index closed flat.
It was all green in other major African markets, Egypt’s EGX Index rose by 3.4 per cent. Ghana’s GSE Composite Index increased by 2.9 per cent while Kenya’s Nairobi Stock Exchange Composite Index recorded a net return of 1.5 per cent.
Further analysis of the pricing trend at the Nigerian stock market showed that there were 48 gainers to 27 losers last week, a major rebound from 16 gainers and 51 losers recorded in the previous week. Neimeth International Pharmaceuticals recorded the highest gain, in percentage terms, of 24.6 per cent to close at 81 kobo. Unity Bank followed with a gain of 19.7 per cent to close at 73 kobo. Forte Oil rose by 15.3 per cent to close at N56.17. Avon Crowncaps & Containers rose by 14.6 per cent to N1.18. NEM Insurance rallied by 14.1 per cent to N1.13. Ecobank Transnational Incorporated appreciated by 14.0 per cent to close at N14.13. Mobil Oil Nigeria rallied by 9.9 per cent to N260. Flour Mills of Nigeria rose by 9.75 per cent to close at N25. Seven-Up Bottling Company increased by 8.8 per cent to N89.23 while Access Bank rose by 8.4 per cent to N9.90 per share.
On the negative side, Conoil led the losers with a loss of 17.43 per cent to close at N29.98. University Press dropped by 14.12 per cent to 2.92. Champion Breweries lost 12.28 per cent to close at N2.50. Union Bank of Nigeria declined by 9.97 per cent to close at N5.51. Jaiz Bank dropped by 9.1 per cent to 60 kobo. Presco declined by 4.99 per cent to N64.54 per share. NCR (Nigeria) dropped by 4.9 per cent to close at N7.33. Capital Hotel declined by 4.89 per cent to close at N3.31. AG Leventis decreased by 4.88 per cent to 78 kobo while BOC Gases dropped by 4.85 per cent to N3.14 per cent.
Total turnover stood at 1.272 billion shares worth N13.993 billion in 19,385 deals last week as against a total of 1.061 billion shares valued at N12.295 billion traded in 18,847 deals two weeks ago.The financial services sector remained the dominant sector with 1.086 billion shares valued at N9.743 billion traded in 11,229 deals; thus contributing 85.33 per cent and 69.63 per cent to the total equity turnover volume and value respectively. The consumer goods sector followed with 44.786 million shares worth N1.536 billion in 2,853 deals while the third place was occupied by conglomeratessector with a turnover of 38.104 million shares worth N75.759 million in 727 deals.
Three banks-United Bank for Africa Plc, FBN Holdings Plc and Zenith International Bank Plc, were the most active stocks. The three banks jointly accounted for 505.388 million shares worth N5.454 billion in 4,009 deals, contributing 39.73 per cent and 38.98 per cent to the total equity turnover volume and value respectively.
Also traded during the week were a total of 25,540 units of Exchange Traded Products (ETPs) valued at N2.646 million in 10 deals compared with a deal for five units valued at N485 struck in previous week.
In the debt segment, a total of 2,977 units of Federal Government bonds valued at N2.946 million were traded in 11 deals compared with a total of 358 units valued at N344,611 traded in seven deals in the previous week.
Most analysts remained optimistic on the outlook for the Nigerian equities market in the week ahead. “As half-year 2017 earnings scorecards begin to trickle in, we expect performance in the equities market to remain upbeat as investors take position in stocks with positive forward earnings projections,” Afrinvest Securities-a Lagos-based dealer on the NSE stated in a preview at the weekend.
“This week, we expect a mix of profit taking and bargain hunting activities amid improvement in the external sector which is a boost to investor confidence,” Cowry Asset Management stated.
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