The Nigerian stock market continued its bullish transition despite the gloomy macroeconomic environment resulting from a seeming lack of policy coordination by necessary to put the economy in the path of recovery. It is obvious in any economy or market that perception, expectation and optimism that drives momentum, sentiments and confidence which supports expansion, growth and recovery.
In any market cycle, weather bullish or bearish, its an industry, sector or individual stocks that triggers or ushers in that state of the market. It is necessary to understand the big picture of the economy and market phases which will help in identifying the right stocks for different stages of the economy and market structure. Psychology and market analysis goes together to help traders know the strength of the trend and momentum. Moreover, psychology drives the quality of analysis and its practical application, making it the primary factor, while analysis serves as the road map.
The market was expecting that the recent moves in banking stocks will usher in the Santa Claus rally, but reactions to the August date for stress testing the capital adequacy ratio of Nigerian banks with international operations has seemingly slowed down the momentum.
Ordinarily, all the banks involved are strong enough to meet up the shortfall as required. Specifically, these banks, judging by their 2023Q3 numbers are healthy, and boast of robust balance sheets, profitability levels, and even strong earnings to support higher dividend payouts, despite the proposed banking sector recapitalization to boost their capital base to enable them effectively drive the expected $1tr economic envisaged by government. The stress testing is expected to confirm the exposure levels of Nigerian banks to global risks resulting from the recent exchange rate volatility, heightened inflation, and geopolitical tension, among others. looking for the sectors or stocks that will lead the next rally before the year runs out. Watch the price actions and charts below.
NGXASI Weekly Chart (Opening chart)
NGX BNK Weekly
NGX Consumer Goods Weekly Chart
NGX Insurance Weekly Chart
NGX Industrial Goods Weekly Chart
NGX Oil/Gas Weekly Chart
NGX 30 Weekly Chart
NGX 50 Weekly Chart
NGX Pension Weekly Chart
NGX Premium Weekly Chart
NGX Mainboard Weekly Chart
FBN Holdings Weekly Chart
NGXGroup Weekly Chart