Market Update for September 20
The mixed momentum on the Nigerian Exchange continued on Tuesday, despite the fact that the benchmark NGX All-Share Index closed flat on positive sentiments to reflect buying interests in some major sectors. Position taking was noticed in the financial services stocks regardless of the recent volatility in the banking sector due to price adjustments for corporate actions and profit taking that revealed the undervalued state of stocks in the sector.
The market remained relatively calm ahead of next week’s meeting of the Central Bank of Nigeria (CBN) Monetary Policy Committee, because many players remain on the fence, waiting to confirm direction before jumping in, as outlook for the economy and the financial market remains unpredictable. However, there are sectors, industries and individual stocks that are still seeing positive activities from traders and investors. Those are stocks players should be paying attention to, as the decline in the NGX index action was halted after the fourth successive session, on improved traded volume in the midst of negative market breadth.
Despite, the seeming bear run, the market internals are revealing the hidden forces that work for both short and long-term traders to get into the best position and allow you to stay in them for maximum profit. The market’s internals measure the forces behind the advancers and associated volume of the uptick or downtick. These two ratios tell you everything you need to know to predict future price movement. So, the volume pattern and index structure in recent sessions show position taking, while funds enter some stocks as revealed by money flow index which need to be confirmed, especially as positive sentiment supported the previous session candlestick formation and reversal pattern which was weak.
At the current declining phase, the decision about when to buy or sell individual stocks or an index, is always based on price actions and the money flow direction which combines price and volume. We only want to hold stocks that are increasing, or at least retaining their value, while avoiding equities that are on the decline, and the toolset to evaluate price action is technical analysis.
The contemporary technical analysis that works in the changing volatile market, is what you should adopt. That is why it’s never been more important to join me at the upcoming Q4 Master Class in October, the largest quarterly traders summit in Nigeria. I will be sharing new actionable strategies and real trading education that will arm you with the tools that will help you meet your financial goals for the rest of the year 2022 and beyond. Also, the last quarter of the year is around the corner, are you prepare to take advantage of seasonality to recover your losses and boost your gains?
To navigate the rest of the month 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 mixed sentiment witnessed, it is time to go shopping for undervalued stocks, sectors and the next insider playing opportunity.”
Oil prices seems to rebound on the fear of rate hike at the end of Fed policy meeting, as it trades at $94.44 in the midst of weak demand and fear of recession around the globe in the face of supply tighten, as China battle with Covid 19 lockdown. The up and down movement in oil price, has also continues to drive volatility in the face of rising interest rates and inflation. Despite the bailout package of the Chinese government to simulate economic activates and stable employment, as well as that of Germany aimed at managing the energy crisis.
Tuesday’s trading started slightly in the upside and oscillated throughout the session on selloffs and buying interest in some medium cap stocks, a situation that pushed the NGX’s index to an intraday high of 49,446.01bps from its lows of 49,378.93ps, before closing slightly above its opening figure at 49,445.31bps.
Market technicals were weak and mixed, with higher volume of shares traded than the previous day in the midst of breadth favouring bears on positive sentiment as revealed by Investdata’s Sentiments Report showing 99% buy position and 1% sell volume. The total transaction volume index stood at 0.81points, just as momentum behind the day’s performance was relatively weak as Money Flow Index is looking down at 42.41pts, from the previous day’s 53.11pts, indicating that funds left the market.
For you to successfully invest and trade in this volatile market, order for Investdata’s video on Buy & Sell Technical Analysis Toolbox to navigate the volatile market profitably, enhance trading decisions and boost your bottom line. Also, to up your game in stock trading and investing, understanding the key to trading price and index action will go a long way to make the difference in your trading results, check out the video materials below.
Index and Market Caps
At the end of Tuesday’s trading, the NGX All-Share index inched up 5.10bps, closing at 49,445.31bps, after opening at 49,440.21bps, representing a 0.01%up, just as market capitalization went up by N3.22bn, closing at N26.67tr, from the previous day’s N26.67tr, which also represented a 0.01% value gain.
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Meanwhile, Thursday upturn was driven by position taking in FBNH, Mutual Benefits Assurance, Regency Insurance, Linkage Assurance, Fidelity Bank, Capital Hotel and Jaiz Bank among others, which impacted mildly on Year-To-Date gain, as it rose to 15.75%. Market capitalization gain YTD also rose to N2.94tr YTD, representing a 19.61% rise over the opening level for the year.
Mixed Sector Indices
Sectorial performance indexes were mixed, as the NGX Banking and Insurance closed 0.22% and 0.15% higher respectively, while the NGX Oil/Gas index led the decliners after losing 2.30%, followed by Consumer and Industrial goods with 0.05% and 0.01% respectively.
Market breadth was negative, as losers outpaced gainers in the ratio of 13:9; just as transactions in volume and value were up, as stockbrokers traded 147.59m shares worth N2.39bn, with volume driven by trades in GTCO, Capital Hotel. FBNH, Zenith Bank and Chams.
RT Brisco and FBN Holding were the best-performing stocks, gaining 10% and 5% respectively, closing at N0.33 and N10.50 per share respectively on market forces. On the flip side, Total Energies and Learn Africa lost 9.98% and 9.71% respectively, closing at N211.10 and N1.86 per share, purely on profit taking.
We expect a mixed trend on bargain hunting and cautious trading as investors digest the latest inflation data and recent results from the banking sector, especially those with interim dividend payout ahead of next MPC meeting, while portfolio rebalancing continues on bargain hunting in the midst of the worsening sovereign risks.
We note also the flow of funds into the fixed income segment on the rate hike by the CBN, as sector rotation persists. Analysts are also focused on the lookout for August CPI and flow of funds amid oil prices oscillation.
INVESTDATA Q4 MASTER CLASS
Theme New Actionable & Technical Strategies For Profitable Trades In Changing Market Environment.
- Equity Investing in changing volatile Market: Two Sides Of The Coin, Mr Rotimi Olubi. MD ARM Securities Ltd
- Arbitrage Trading & Other New Strategies To Hedge Against Stagflation, Mr Abiola Rasaq , CSCS
- Mastering Contemporary Technical Tools For Wealth Building In Uncertain Environment, Mr Abdul-Rasheed Momoh, Head Capital Market, Trw Stockbrokers Ltd
- Time & Price Analysis For Money Making In Uncertain Market, Mr Ambrose Omordion, CRO. Investdata Consulting Ltd.
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- How all fixed income market instruments had failed investors in stagflation environment
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- How classical technical analysis had failed many traders in this high volatile market
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- Tradeable chart patterns and candlestick formations that signal real money-making opportunities
- Five hot stocks that beat inflation and deliver over 30% in a short period of time.
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Time: 9AM Prompt
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CRO|Investdata Consulting Ltd
Tel: 08028164085, 08179547605