Mixed Trend, Sentiment Ahead Economic Data, MPC Outcome, 2021 Year-End Positioning

Market Update for the Week Ended November 12 and Outlook for Nov 15-19

The market tends to reward discerning investors with a plan and the patience to wait for the right moment when such come true. There are three important things to consider when preparing for your trading days and the New Year:  Have your expectations of what a market could do on the day you want to trade; know your plan in advance when the market follows your expectation, or when it doesn’t; and finally, execute your trading or investing strategy when the market follows your plan, and be flexible and change when your expectation proves wrong.

We envisage a mixed trading pattern due to bargain hunting activities in dividend-paying stocks amid intermittent profit-taking activities. That notwithstanding, we advise investors and traders to position in fundamentally sound stocks with positive technicals and sentiment, since the market’s fundamentals and liquidity continue looking up, with oil price trading above $84 in the international market, while the nation external reserves keep looking up.

Technically, the NGX index’s action on a weekly time frame reveals mixed sentiments, as the ADX remains above 20 points at 33.15, just as the money flow index stood at 77.28 points, revealing the increase in money flow into the equity space. These are indications that confirm volatility, despite the seeming decline in the daily chart due to profit-taking, just as the NGX index has rebounded again to break out the strong resistance level of 42,414 basis points. This signals the possibility of trend continuation on a weekly time frame with the index touching 44,068.70 points before pulling back, following which we have to wait to see what happens in the new week as portfolio repositioning continues on the strength of the Q3 earnings reports.

The above-average trading volume, during the week, is an indication that institutional investors are not selling and the volume that took the market up is still very intact. The light volume on the profit-taking activities shows that retail investors like you and I are the ones selling.

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Movement Of NGXASI

It was a mixed trend for the week under review, as the NGX index action fell in three days, and rose twice, while trading for the week started on a strong upbeat due to positive reactions by investors to the news of the issuance of Approval in principle that would enable telecommunications giants- MTNN and Airtel Payment Service Bank, by the Central Bank of Nigeria (CBN). That announcement pushed Monday’s index up by 2.73%up, which was sustained on Tuesday when the benchmark index chalked an additional 1.11%, following the increased buying interests in tech stocks. There was, however, a pullback by the midweek, Thursday, and Friday, when the composite index shed 0.05%, 0.36%, and 0.68% respectively, bringing the week’s accumulated gain to 2.96%, compared to the previous week’s 0.06% loss. This performance was driven by buy interests in bellwether stocks like MTNN and Airtel Africa.

Consequently, NGX All Share index gained 1,238.51 basis points, closing at 43,253.01bps, after touching an intra-week high of 44,068.70bps from its lows of 41,976.30bps, from the week’s opening figure of 42,014.50bps on mixed sentiments and profit-taking in low and medium cap stocks. Market capitalization during the period rose by N647.01bn, closing at N22.57tr, compared to the previous week’s N21.93tr, which also represented a 2.95% appreciation in value.

The top gainer’s table for the week was dominated by a blend of low, medium, and highly-priced stocks which had become the toast of investors, despite the daily time frame negative vibes and buying sentiments, as a result, positive sentiment for MTNN, Airtel, Unilever, FBN Holdings, Redstar Express, and Neimeth Pharma, in the midst of dividend positioning on the strength of nine-month financials and positive economic data.  The week also witnessed the price adjustments of Lafarge Africa and Airtel Africa for interim dividends of N1.00 and N8.29 respectively.

Market breadth was negative during the week amidst the above-average traded volume and mixed sentiment likely to continue as the year winds down. Losers outnumbered gainers in the ratio of 36:27 in the week under review, on a mixed sentiment as revealed by investors’ sentiment report showing a 39% sell volume and 61% buy position. Money Flow Index rose to 77.28bps from the previous week’s 76.58 points, an indication that some funds entered the market.

NSEASI WEEKLY CHART MOVEMENT

On the weekly chart, the NGX index’s action is trading above the 20 and 50-day moving averages to sustain a bull-trend after breaking out a strong resistance level of 42,414.17bps on an above-average traded volume that indicates a continuation of an uptrend. The candlestick pattern at the end of last week was also a bullish candle that revealed the presence of sellers.  The index action is set to make or break depending on market sentiment in the new trading week that will support an uptrend or a pullback. However, we need to watch out for the October consumer price index expected to hit the market in the new week. Also with all eyes on fixed income market yields and oil prices that should further support market fundamentals and help attract liquidity to the equity space. This pullback has created new buying opportunities.

Bearish Sectoral Indices

The performance indexes across the sector were in red, except for the NGX Consumer Goods index that closed 0.63% higher, while the NGX Insurance led the decliners after losing 2.25%, followed by Banking, Energy and Industrial Goods with 1.31%, 0.69%, and 0.01% respectively. Activities in volume and value terms were down, as players exchanged 1.47bn shares worth N20.94bn, compared to the previous week’s 1.43bn units valued at N12.37bn. Volume was driven by Financial Services, Conglomerates, and Consumer goods, particularly FBN Holdings, Sterling Bank, UACN, UBA, and Transcorp.

The best-performing stocks for the week were Neimeth Pharm and Redstar Express which gained 12.50% and 12.18% respectively, closing at N0.22 and N0.38 per share respectively on market forces. On the flip side, Conoil and Pharm-Deko lost 14.90% and 9.83% respectively, at N21.70 and N2.11per share, purely profit-taking.

Outlook for the week

We expect a mixed trend and sentiment to continue ahead of economic data and the MPC meeting being the last for the year 2021, as investors and bargain hunters continue to take advantage of price pullback in fundamentally sound stocks for repositioning. It is also noteworthy that fund and portfolio managers continue to take a position on the Q3 numbers ahead of the current financial year-end. For now, many stocks remain in their buy range to attract funds into the equity space. Also, investors will continue tracking yields movement in the fixed income market.   Also, investors are still observing the interplay of forces in the FX market as the exchange rate in the back market continues to decline. Last week’s above-average volume suggests that institutional investors are not selling. It is noteworthy that oil price continues to oscillate as it trades above $83 in the international market; corporate actions, as well as the interim dividend possibilities, are around the corner.

Invest 2022 Traders & Investors Summit

Theme: Master The Market, Get The Best Of Pre-Election Year 2022

Sub-Topics

1.  Balanced Trading: Playing Nigeria’s Multiple Exchanges For Diversification, MrOlatundeAmolegbe, CEO, Arthur Steven Asset Management  Ltd &President of CIS 
2. Agriculture, Economic Recovery & Diversification: Where Is Commodity Trading In Your Portfolio, MrAkinyinkaAkintunde, Business Development Manager, AFEX Commodities Exchange Ltd.
3. Technical Outlook & Indicators For Profitable Market Timing, Mr Abdul-Rasheed OshomaMomoh, Head Capital Market at, TRW Stockbrokers Ltd 
4. Benefits & Dangers Of Fixed Income Instruments In An Inflationary Environment, MrTeribaAdeboye, MD/CEO, Qualinvest Capital ltd
5. Economic Outlook and implications of the N16.45 Trillion 2022 Budget On Sectors/Stock Market, MrOluwasegunAkinwale, Senior Portfolio Manager,Coronation Asset Management Ltd
6. Profitable Stock Picks Made Easy, Using Fundamental Tools, Mrs. Ebiere Helen Fumudoh, MD/CEO, Norrenberger Securities Ltd
7. The Role of Real Estate & REIT Instruments In the Ecosystem, Mr Tope Ojo, Managing Partner,Tope & Tunde Estate Surveyors &Valuers 

8. Trade Opportunities & 10 Golden Stocks for 2022, Mr Ambrose Omordion, Chief Research Officer, Investdata Consulting Ltd

Investdata Consulting Limited holds the 10th edition of its annual Investment conference tagged Invest 2022 Traders & Investment Summit, which has over the years remained a game changer for market players. This edition is aimed at helping stakeholders identify opportunities and bringing ideas for profitable trading as we enter a pre-election year.

Invest 2022 is a not-to-be missed summit capable of completely changing your view about where the economy and stock market are headed and when you should fully plunge in or hold cash.  Join the experts and experienced professionals to discuss a Big Picture Perspective of where the stock market and other investment windows are currently placed and what signs to be vigilant about over the coming months and year 2022.  Don’t miss this summit.

We have held this annual summit since 2012, to give investor and traders insight, perspective and expectation in the new year.  This year Invest 2022 Summit is exceptional being vaccination driven economic recovery after Covid 19 disruption.  The big picture of what is happening and outlook for 2022, analysis of the status of different investment windows and opportunities, ranging from the economy, equity, bond, commodity, real estate and others using fundamental and technical tools.

More than 80% of the golden stocks pick during Invest 2021 Summit have beaten their targets, returning more than 40% to 60% in less a year. Due to growing concern and fear around the globe and domestic economy/stock market as analysts are predicting a big melt-down in stocks from ant time soon, to sometime in 2022.

Looking at history, there is no doubt that correction or pullbacks are on the cards at some stage. However, this big questions on everybody minds are when will this occur and whether it will end this bull run or market recovery.

Whatever happens, what is the best way to Prepare rather than try to Predict? This is what Invest 2022 Summit will address.  So you are invited to Speck or facilitate at this event

What to expect at this Summit?
A. Why the market is on high alert for the New Year rally, or Correction
B. Strategies to stay in profit, overcome market correction/pullbacks
C. How to position in stocks for robust profit ahead of 2022
D. How to take advantage of the circular flow of funds in financial markets
E. Risk/return from Bonds to stocks right now.
F. Key to profitable trading and investing in the stock market/other investment windows

Benefits for attending

 1,10 Golden Stocks for 2022
 2, Admission to Investdata Buy & Sell WhatsApp Platform
 3, Among others
Don’t miss this summit, if you have any exposure to the stock market, either directly or indirectly via managed funds of any kind…….
“Invest 2022 – Connects you to new trade opportunities and ideas to boost your trading results/bottom line”

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 4, 2021

Time: 9am

Venue: Zoom

Want to be among the successful investors and traders in 2022? Send Yes to 08028164085, 08179547605 now.

Meanwhile, the home study packs on Comprehensive Stock Market trading course video,Stock Market Analysis Beyond Fundamental & Technical Analysis,  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 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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