Expect Mixed Sentiment, Trend As Investors Digest 2022Q3 GDP Data, CBN Rate Hike Impact

Market Update For November 24

Thursday’s trading activities on the Nigerian Exchange had a mixed session and sentiment, sustaining its positive momentum on price appreciation of large cap companies in the midst of profit taking across the major sectors of the market on a low traded volume and negative market breadth. Also, the all expected Q3 GDP figure came confirming a slow growth of 2.25%, extending the three consecutive quarters of decline since the last Q4 2021, when compared with 4.03% in the same period in Q3 2021.

The strong momentum and strength behind the recent rebound by the Nigerian Exchange waxed stronger during the session, practically ignoring the latest 100 basis points rate hike by the Central Bank of Nigeria, which raised the Monetary Policy Rate to 16.5%, representing 500bps increase MPR in six months from 11.5% to 16.5% in four consecutive meetings of the apex bank. As market players digest the latest weak economic growth date released by NBS, which confirms the impact of the negative aggressive rate hike by the CBN, which is made worse by the policy mismatch by the government’s economic managers in a changing economic and political space.

The seeming buying pattern going on in the market recently suggests that funds are entering the market, notwithstanding the transaction volume that is yet to confirm the present of institutional investors, as NGX index had technically rebound, as revealed by trend following and momentum indicators. But the current NGX index action crossover of the 50-day SMA and EMA on a low traded volume that indicates the absence of smart money. A breakout of the 50-day moving average signal the possibility of institutional investors’ entrance to the market ahead of year-end seasonality and corporate actions in 2023.

Profit-taking across the major sectors of the market especially in energy, banking and others, as the key performance NGX All-Share index extended its bull run for the fifth successive session in strengthen momentum at the accumulation/ early markup phase of the market.

Also, investors continue to reposition their portfolios on the strength of the recent corporate earnings. Investors are viewing all of these against the backdrop of the rampaging inflation as they hedge against the rising inflation in some stocks with high dividend yields and strong earnings to support higher payout as financial year end of many companies draw closer.

The current low traded volume in the face of the positive market breadth signals the activities of speculators, and bargain hunters, given that institutional investors are still standing on the fence as revealed by transactions on the exchange. The increasing buying interest in banking stocks and other undervalued companies signals a buy market and imminent price markup by smart money.  We also note the fact that many players, including the institutional investors are still holding cash to confirm market direction, especially given the anticipated financial market reset in 2023, and beyond expected to create wealth for action takers.

To navigate the rest of the year profitably using fundamental and technical analysis to run, join investdata live sessions at noon every trading day “and also get investdata technical toolbox to play the current state of the market do suggest that discerning investors are gradually becoming greedy, while others are fearful, as seen in the recent range market. Despite the low volume of transaction witnessed, it is time to go shopping for undervalued stocks, sectors and the next insider playing opportunity.”

Oil price oscillation continued as it rebound to trade at $86.15, as Russia oil price is being caped in the midst of Saudi cutting production, Covid 19 cases in China, geopolitical tension and fear of recession as a result of high interest rate and inflation across the globe. Also supply tighten due to the Russia-Ukraine war that has been lingering.  The up and down movement of oil price also continues to drive volatility. Despite the bailout package of the Chinese government to simulate economic activates and stabilize employment, as well as that of Germany aimed at managing the energy crisis.

Meanwhile, Thursday’s trading opened slightly in the red before rebounding at midday on demand for telecommcation stocks, among others, a situation that pushed the NGX’s index to an intraday high of 46,604.94bps from its lows of 46,186.63bps before closing above its opening level at 46,604.94bps.

Market technicals were positive and mixed, with lower volume of trade than the previous session in the midst of breadth that favored the bears on buying pressure as revealed by Investdata’s Sentiments Report showing 100% buy position and 0% sell volume. The total transaction volume index stood at 0.81 points, just as momentum behind the day’s performance was relatively strong as Money Flow Index was looking up at 72.33 pts, from the previous day’s 60.95pts, indicating that funds entered in the market.

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Index and Market Caps

At the end of Wednesday, the benchmark NGXASI gained 372.57bps, closing at 46,604.94 basis points, after opening at 46,232.37,bps, representing a 0.81% growth, just as market capitalization rose by N202.93bn, closing at N25.38tr from the previous day’s N25.18tr, which also represented a 0.81% appreciation in  value.

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The day’s upturn was driven by position taking in the shares of Airtel, BUA Cement, ETI, Fidson, Eterna and Mansard among others, which impacted positively on Year-To-Date gain, increasing to 9.10%. Market capitalization gain YTD stood at N2.97tr, representing a 13.85% rise over the opening level for the year.

Bearish Sector Indices

Sectorial performance indexes were in red, led by the NGX Energy after losing 1.86% followed by Banking, Consumer, Industrial and Insurance with 1.37%, 0.43%, 0.38% and 0.12% respectively.

Market breadth was negative, as losers outnumbered gainers in the ratio of 23:16; just as activities in volume and value were mixed as investors exchanged 138.60m shares worth N2.17bn. Volume was driven by trades in Sterling Bank, Transcorp, ETI, Accresscorp and Jaiz Bank.

Mansard Insurance and NB were the best performing stocks after gaining 8.57% and 6.79%, closing at N1.90 and N48.00per share respectively on market forces and corporate actions. On the flip side, Nestle and Redstar Express lost 10% each, closing at N1071 and N2.07 per share, purely on selloffs and profit taking

Market Outlook

We expect mixed sentiment and trend as players digest Q3 GDP and CBN rate hike, amidst bargain hunting, repositioning of portfolios and election uncertainty, as investors are taking advantage of the low prices ahead of year end seasonality.

Invest 2023 Traders & Investors’ Summit

Theme: Preparing For Financial Market Reset In 2023 & Beyond

Sub-Topics

1, Budget 2023, Economic Headwinds & The Stock Market: Are Market Players Prepared? Mr Olatunde Amolegbe, CEO, Arthur Steven Asset Management Ltd & Immediate Past President of CIS

  1. Comprehensive & Complete Wealth Building Actionable Strategies for 2023 Mr Oladipo Ajayi Head of Fixed Income at Chapel Hill Denham
  2. 2023 Stock Market Outlook And Identifying Great Value Stocks For Santa Claus & Post-Election Rally Alhaji Garba Kurfi MD/CEO APT Securities & Funds Ltd)
  3. The Power of Technical Tools In Today’s Volatile Market Mr Rotimi Olubi. MD ARM Securities Ltd
  4. Building Recession-Resistant Portfolios In A Financial Reset Mr Muktar Mohammed, MD Muktar Finance Ltd
  5. The Role of Commodity Trading In Wealth Creation, Agricultural Development
  6. Fixed Income Market Slice & Dice In A Changing Interest Rates, Inflationary Environment Mr Teriba Adeboye, MD/CEO, Qualinvest Capital ltd

8, Four Steps To Simplify Your Day Trading & Understanding the power of Breakout Trades Mr Abdul-Rasheed Oshoma Momoh, Head Capital Market at, TRW Stockbrokers Ltd

9, 10 Golden Stocks for 2023,  Mr Ambrose Omordion, CRO. Investdata Consulting Ltd.
Investdata Consulting Ltd will hold the 11th edition of its annual Investment conference tagged Invest 2023 Traders & Investors Summit, which has over the years remained a game changer for market players. This edition is aimed at helping stakeholders prepare for the financial market reset expected to happen next year by identifying opportunities and bringing tradable ideas for profitable investment as we enter election year. This one-day event is yet “Another wealth transfers for the prepared as the bull is underway after this correction “

Are you prepare to move cash to profitable assets ahead of year-end and the 2023 general elections, Invest 2023 is a don’t miss summit that is capable of completely changing your view about wealth creation in a disconnect system where the economy and stock market are headed and when you should fully plunge in or hold cash. Join equity market experts and other experienced professionals as they discuss a “Big Picture Perspective” of where the stock market and other investment windows are today, and what signs to watch for in the coming months.  Don’t miss this summit.

This annual summit offers you, whether an investor, or trader an insight, perspective and expectation in the new year. This edition is exceptional, given the increasing headwinds across the globe and locally, ranging from the aggressive rate hikes, soaring inflation, geopolitical tensions, and uncertainties surround the 2023 general election like others before it. There will also analyses on the status of different investment windows and opportunities ranging from the economy, equity, bond, commodity markets, using fundamental and technical tools.

Looking at history, there is no doubt that a correction or rebound is on the cards at some stage over the coming months. However, this big questions on everybody’s lips include when this will occur and whether it will end this bull-run or market recovery. Whatever happens, what is the best way to Prepare rather than trying to Predict? This and more, are what Invest 2023 Summit will address.

What to expect at this Summit?
A. How to take advantage of the correction for huge profit
B. Strategies to stay in profit, overcome market correction/pullbacks
C. How to hedge against inflation and preserve your portfolio
D. Understanding the power of liquidity and circular flow of funds in financial markets
E. Risk/return from Bonds to stocks right now.
F. Commodity trading as another  investment window to boost return

  1. The exact sectors and tickers you should be looking at this volatile market
  2. Market events and others you can use to trade in any market situatio

Benefits of attending

  1. 10 Golden Stocks for 2023
    ii. Admission to Investdata Buy & Sell WhatsApp Platform
    iii. Among others

“Invest 2023 – Connects you to new trade opportunities and ideas to enhance your trading returns

Don’t miss this summit, if you have any exposure to the stock market, either directly or indirectly via managed funds of any kind……

Date: December 3, 2023

Time: 9am

Fee: N30,000

Venue: Zoom

If you want to reset your profit by taking advantage of opportunities in financial market and assets repricing in 2023? Send Yes to 08028164085, 08179547605 now.

Ambrose Omordion

CRO|Investdata Consulting Ltd

info@investdata.com.ng

ambrose.o@investdataonline.com

ambroseconsultants@yahoo.com

Tel: 08028164085, 08179547605

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