Market Update for April 20,
Post-Easter holiday, there is increasing volatility on the Nigerian Stock Exchange at a time all eyes are on first quarter earnings reports to give direction of where quoted companies and market are heading to. Moreso, economic data released so far signal a recovery which would expectedly to be sustained if the needful is done by the government and its economic managers. The NSE’s benchmark index was down on Thursday on mixed sentiments that expected financials may not meet investors’ expectations with one company after another file to delay their scorecards submission date, even when they have approximately a week or less to regulatory deadline.
The volume index on Thursday was at 0.60, while buying position was 44% and selling volume 56% of the day’s total, which reveals mixed investor sentiments about company earnings.
In contrast, stock markets around the world closed higher Thursday, as oil prices in the international market rebound despite the continued concerns about North Korea and fears ahead of the French presidential election.
In London, Unilever and Nestle are due to report their latest earnings figures. Elsewhere, Exxon Mobil is pursuing a waiver from sanctions on Russia to drill in the Black Sea in a venture with Russian state oil company Rosneft, the New York Times reported.
Meanwhile, finance ministers and central bank governors gather in the U.S. where the International Monetary Fund and the World Bank began their Spring Meetings. Already, the IMF Managing Director Ms. Christine Lagarde and World Bank President Jim Yong Kim have addressed conference.
Meanwhile, the composite NSE All Share Index shed 43.66 basis points to close at 25,288.11 from an opening figure of 25,331.77, representing 0.19% decline on low volume traded, which was lower when compared to the previous day’s volume.
Similarly, market capitalisation for the day dropped by N15.1bn to close at N8.75tr, from an opening value of N8.77tr, which represented 0.19% depreciation in value.
Value depreciation recorded in the share prices of 7up, Okomu Oil, Ecobank Transnational Incorporated (ETI), Dangote Cement, Zenith Bank and FBN Holdings impacted the All Share index to marginally increase year-to-date negative position to 5.93%, while the drop in market capitalisation adjusted to N496.93bn, representing a 5.40% loss YTD, from the year’s opening value.
Market breadth for the day was positive but weak as the number of advancers outnumbered decliners in the ratio of 16:15 to ensure that the bull market was short-lived.
Market activity in volume and value were down by 54.07% and 45.30% respectively to 147.89m shares from previous day’s 322m shares, valued N836.84m from previous day’s N1.53bn. Volume of transaction was driven by shares of Diamond Bank, Guaranty Trust Bank, FCMB, UBA and Transcorp as the most traded equities.
The NSE All-Share index and all sectoral indices were mixed to close the day’s trading session.
During trading, the share price of Nascon Allied Industries was adjusted for 70kobo dividend proposed by the directors for the year ended December 31, 2016. UACN and Vitafoam notified the exchange of its closed period for the expected first quarter earnings report, while Nigerian Breweries made available its first quarter earnings report to the market with marginal growth in its earnings to 144 kobo per share, as against previous first quarter’s 132kobo.
At the end of the day’s trading, Africa Prudential led the advancers log with 5.00% to close at N2.53 per share, driven by market forces; followed by Stanbic Holdings with 4.80% to close at N19.50 on expectation of Q1 result, while 7-Up topped the decliners’ log, shedding 5.00% of its opening value to close at N99.66, market forces ahead of Okomu Oil’s 5.00% slide to close at N47.39 on profit taking.
As market opens this morning, we advise that investors allow numbers to guide their decisions to reposition for Q2 trading as the first quarter earnings reporting season is ongoing. Industry potential is very important when picking a particular company, because there are things that are sector-wide and would naturally impact positively or negatively on companies operating within such an industry.
