Market Update for March 23
It was another very volatile and mixed session on the Nigerian Stock Exchange Tuesday, as the composite All-Share index continued its seesaw movement, closing lower on an above average traded volume and marginally negative breadth, extending the ranging trend.
It, therefore, reversed the previous day’s gains, amidst the obvious indecision among players while the market expected the outcome of the two-day meeting of the Central Bank of Nigeria’s Monetary Policy Committee. They likely joggled the various scenarios available to the committee members and implications of wherever the vote could tilt. The meeting however ended with members opting to retain all the parameters unchanged as earlier envisage by investdata, even amidst the temptations posed by the rising inflation and uncomfortable unemployment rates, which were overwhelmed by the fragile economic recovery from recession (READ MORE).
While we agree with the submission of the majority of the MPC members, the nation’s hyperinflation is not, however, a result of high liquidity in the system, but due to the high cost of production and lack of structural reforms. These are made worse by the unstable exchange rates, which with a high unemployment rate at 33.3%, reveals a struggling economy despite exiting recession.
One can only imagine where the economy would be at this time, but for the sustained stimulus offered by the monetary authorities, which the Federal Government must complement by doing more to check the rising insecurity across the country, high pump price of fuel, and electricity tariffs, among other challenges. Unless these issues are tackled frontally, at this rate, food inflation could hit 30%, further pushing up March and April inflation rates.
Investdata believes that the CBN’s decision to retain Monetary Policy instruments is a welcome development as it would allow the economy to breathe, while watching developments that would manifest before next MPC meeting in May.
Tuesday’s trading started on the upside and oscillated in the mid-morning to late afternoon on buying interests and selling positions across all classes of stocks, a situation that pushed the NSE index action to an intraday low of 38,696.85 basis points from its highs of 38,952.06bps, before closing slightly below its opening point at 38,704.97bps.
Market technicals were mixed and strong, with volume traded higher than previous day’s in the midst of almost a flat breadth amidst high selling pressure as revealed by Investdata’s Sentiments Report showing 97% ‘sell’ volume. Total transaction volume index stood at 1.01 points, just as energy behind the day’s performance remained weak, with Money Flow Index looking up sharply at 46.96pts, from the previous day’s 40.93pts, indicating that funds entered the market, despite closing marginally down.
Index and Market Caps
The benchmark index at the end of Tuesday’s trading, shed 17.90bps, closing at 38,704.97bps after opening at 38,722.87bps, representing a 0.05% drop. Similarly, market capitalization fell by N9.36bn to close at N20.25tr, from previous day’s N20.26tr, which also represented 0.05% depreciation in value.
Attention: If you have not signed up for Investdata buy and sell signal setup, don’t delay. We have just reduced to 8 STOCKS TO WATCH THAT ARE BUILDING NEW BULLISH BASE in our watchlist. These stocks are with double potentials to rally considering their current and oscillating mood of the market value.
To become a member, send ‘YES’ or ‘STOCKS’ to the phone numbers below. Take advantage of this service to buy right and sell right at the current oscillating market in the midst of earnings season, portfolio reshuffling and repositioning as we await an economic reform policy to stimulate and re-track the economy again.
The day’s downturn was impacted by selloffs and profit booking in Lafarge Africa, Flour Mills, Guinness, Dangote Sugar, Zenith Bank, United Capital, Africa Prudential, ETI, and FBNH, among others. This impacted positively on Year-To-Date loss, reducing it to 3.89%, just as market capitalization loss dropped to N800.13bn, or 3.83% below its opening value for the year.
BullishSector Indices
Performance indexes across the sectors were up, except for banking that closed 0.65% negative, while the NSE Insurance index led the advancers after gaining a marginal 0.64%, followed by Energy and consumer goods with 0.13%, 0.29% and 0.14% respectively higher.
Market breadth turned slightly negative, as decliners outnumbered advancers in the ratio of 20:19; just as transactions in volume and value terms were up after traders exchanged 410.39m shares worth N5.98bn.
CAP and Coronation Insurance were the best performing stocks, gaining 10% each, after closing at N22.00and N0.55 per share respectively as the market reacted positively to the N2.10 dividend declaration and audited earnings expectation respectively. On the flip side, Livestock Feeds and Chams lost 9.52% and 8.70% respectively, closing at N1.90 and N0.21 per share, on market forces and profit taking.
Market Outlook
We expect the mixed trend to continue as more corporate earnings hit the market in the face of rising dividend and fixed income market yields, as well as a trigger from the outcome of f MPC meeting during this earnings season and month/quarter activities. Also, the pullbacks offers bargain hunters and income investors another opportunity to reposition in high dividend yield and undervalued stocks, while more companies release their full-year numbers to support recovery. This is based on the fact that the rising fixed income yields may not be enough to scare all investors away from the equity market.
Again, the way to go is: Target dividend-paying stocks and fundamentally sound companies with growth prospects in 2021, looking the way of mispriced equities. This is especially given the rising oil prices that have so far supported the economy and equity market, despite the seeming improvement in the fixed income yield which had remained at negative real rate of return due to the subsisting high inflation.
However, the strong and faster recovery may continue, depending on market forces, going forward, as propelled by 2020 full numbers and expected 2021 Q1 earnings reports, until the next MPC meeting in May.
The NSE’s index action and indicators are heading in the same direction on a low traded volume and positive buying sentiments in the midst of rising yield in bond and TB.
Master Class On Comprehensive Cash flow For Personal Wealth Creation
Sub-Topics
1.Catch The Right Market Top With Tested Strategies To Preserve Wealth In A Quiet Market – By Engr. Ekwueme Michael Anyadibe, M.D, X-Front Trader Ltd
2. How To Invest & Trade For Short, Medium, And Long Term In A Mix Market, Alhaji KurfiGarba MD/CEO Apt Securities & Funds Ltd
3. Comprehensive Trading, Using The 4 Phases Of The Stock Market To Create Consistent Cashflow In Bear and Bull Cycle, Combining Fundamental And Technical Tools. Mr Ambrose Omordion, Chief Research Officer, Investdata Consulting Ltd
To effectively take advantage of changing trading patterns and the oscillating stock market, active traders and investors must stay ahead of the new market structure and conversant with strategies used by institutional investors or smart money.
With traders like you in mind, we have designed this Quarterly Comprehensive Master Class For Personal cashflow and Wealth Creation at this special workshop that will feature time-tested traders and CEOs of some of the largest stockbroking firms by various parameters on the NSE. They will share knowledge accumulated over several decades of time and money.
In this EIGHT-HOUR master class, you will learn strategies and techniques on how to create cash flow and capture winning trades in any market cycle.
Specifically, the session is aimed at sharing knowledge on:
1. How to eliminate the guesswork from your trade, using investdataFundaTech Toolbox to determine trade opportunity.
2. What strategies work best for the current market situation
3. Refining your ‘buy’ and ‘sell’ strategies with precision
4. Identifying key sectors capable of supporting the market and creating cash flow.
5. How to time the market in any cycle
6. Actionable trade ideas and stock chart analysis
7. 10 trading ideas and hot stocks to buy in Q2 and beyond
8. Special Telegram group for immediate action taking, updates and direction
Date: April 3, 2021
Time: 9am prompt
Venue: ZOOM.
Fee: N 50,000
However, with less than 25 days to Q2 2021, you need to start planning your cash-flow through trading in second quarter and beyond.
During this practical session our team of experts will reveal practical trade ideas and opportunities in Q2 2021 to consolidate your gains and maximize returns. That is what you can apply or implement immediately and start tracking the result by yourself and Investdata research team on your behalf. Want to be among the smart investors and traders in Q2 send Yes to: the phone numbers below now.
Also, the current undervalued state of the market offers investors opportunities to position for the short, medium and long-term, which is why investors should target fundamentally sound, and dividend-paying stocks for possible capital appreciation in the new year.
Meanwhile, the home study packs on INVEST 2021 New Opportunities & New Paths To Profits Summit materials and 10 Golden Stocks for 2021, Strategies and How to invest profitably in this Changing Market Dynamics/ Recession, Mastering Earnings Season For Profitable Investing and Trading in any market situation/ cycles, Life Beyond COVID 19 Investment Opportunities In The Stock Market are now available. To obtain your pack send ‘Yes’ or ‘Stock’ to 08028164085, 08179547605, 08111811223 now.
Ambrose Omordion
CRO|Investdata Consulting Ltd
ambrose.o@investdataonline.com
Tel: 08028164085, 08032055467
