It was a winning streak on the Nigerian Exchange, as the first full trading week of November closed on a positive note to sustain the bullish momentum from the previous month, on increased buying interests in the face of the low valuation of some equities and rising fixed income market yields. Market players continued to react to the better-than-expected quarterly corporate earnings as a basis for portfolio rebalancing ahead of major events like the October consumer price index being awaited, as well as the Q3 GDP report, and outcome of the last Monetary Policy Committee meeting for the years expected to shape the market in the short to medium term as preparations for 2024 surprises and transformation.
The nation’s slow economic activities and growth can be attributed to high interest rates and rising inflation which is now a permanent feature that weakens the purchasing power. Nigeria’s stock market is still undervalued today relative to the recent earnings that emanated from companies on the exchange in the midst of macroeconomic headwinds and high volatility.
That notwithstanding, the NGX All-Share index is repeatedly hitting a new all time highs on price appreciation by highly priced stocks, entering overbought region that signals the possibility of correction, or pullbacks that create new entry opportunities for discerning investors and traders. In the coming week, we expect a mixed sentiment on bargain hunting and profit taking as portfolio reshuffling and sector rotation continue.
See the chart patterns and price actions below for a guide.
NGXASI Weekly Chart (Opening)
NGX CONSUMER GOODS
NGX INDUATRIAL GOODS