Lingering Profit Taking Extend Bearish Trend To New Week.
Weak investor sentiment which characterised last week ended is poised to usher in the new week, as market capitalisation and year to date (YTD), Month to date (MTD) returns shrinks.
For the week ended Friday 07 January, sentiments remained weak in the Nigerian equities market as profit-taking activities prevailed for a greater part of the week.
As expected, the All-Share Index declined by 2.7 per cent, equalling the previous week’s loss, to settle the YTD and MTD returns at +4.6 per cent and -1.6 per cent, respectively.
The decline in returns was precipitated by selloffs in market heavyweights DANGCEM which declined 5.5 per cent, BUACEMENT by -4.3 per cent, and MTNN by -2.2 per cent.
Analysing by sectors, the Industrial Goods index during the week dipped by -2.2 per cent, Oil & Gas index by -3.0 per cent, Consumer Goods index by -2.2 per cent, and Banking index by -1.5 per cent, all closed the week in red. However, the NSE Insurance index garnered +0.2 per cent, as the week’s sole gainer.
Cordros Investment noted that the trend witnessed during the week “is likely to persist, as the dual impacts of the weakening sentiment and mixed earnings performances during earnings season are expected to pressure market returns. Nonetheless, we advise investors to take positions in fundamentally justified stocks.”
Meanwhile, on the last trading session of the week, the Nigerian equities market closed negative Friday as NSE-ASI shed 0.26 per cent to close at 28,067.09pts. Similarly, the market lost 2.69%WTD. Similarly, market breadth index was negative with 18 losers against 16 gainers.
JAPAULOIL emerged the highest gainer on Friday with 10.00 per cent share price appreciation, while TRANSEXPR with 10.00 per cent decline led the losers’ chart for the day.
GUARANTY which declined Friday by 1.67 per cent was the most actively traded stock with about 77million units of shares worth about N2.27billion transacted by investors on the last trading day of the week.
Sector Performance on Friday showed that the NSE Banking Index lost 1.22 per cent on the back of the sell-offs in ETI which declined by -4.05 per cent UBN which dipped by -3.47 per cent, GUARANTY by -1.67 per cent and ZENITHBANK by 1.00 per cent.
However, the NSE Industrial Index appreciated by 0.71 per cent, driven by buy-interests in BUACEMENT which recorded rise in its share price by 1.14 per cent, and WAPCO also posted 0.66 per cent growth.
The NSE Consumer Goods Index on the last trading session of the week rose by 0.14 per cent, as a result of the gains by 7.84 per cent posted by HONYFLOUR, FLOURMILL’s growth by 3.64 per cent and DANGSUGAR’s +3.47 per cent share price appreciation. The NSE Oil & Gas Index closed flat on Friday.
The equities market closed down Friday as a result of the losses recorded in banking names.
We still maintain our view that investors should take positions in quality names with a medium to long time investment horizon as prices remain attractive at current levels.
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