Market Update for February 2
Accumulation in the shares of MTNN, Seplat, Geregu Power and others on the Nigerian Exchange Thursday boosted the benchmark NGX All-Share index as it closed higher, extending its bull transition for the fourth successive session thereby breaking out another strong resistance of 53,774.61 on a very high traded volume and positive market breadth. Also, dividend announcements from highly priced stocks opened the eyes of market players to what they should expect in this earnings reporting season, despite the increasing volatility and likely profit-taking activities any moment from now, given the uptrend recorded so far in this year.
The upbeat market and increasing flow of funds into the equity space as revealed by money flow index and buying pressure at this moment tells the importance of price, value and timing in stock investing or trading. So as market player, effective combination of fundamental and technical analyses at any market cycle is key and powerful to profitable trading.
The higher momentum recorded on Thursday was due to price appreciation in many quoted companies, as investors continue to react positively to the unaudited quarterly and 2022 full-year audited results so far released to the market. Most of the numbers came healthy and beat analysts’ expectations. The corporate earnings have given an insight into what final dividends from these companies could look like, especially those expected to grow their payout, judging by their Earnings Per Share and established dividend policies.
The positive sentiment and increased buying interest across some major sectors of the market is despite the less than average volume which may continue to support the rally as revealed in the short and medium-term trends that have remained intact. However, Friday’s trading being the last for the week will give a clear direction as more companies release their scorecards. This may signal the continuation of this recovery in the month of February, notwithstanding uncertainties associated with the coming 2023 general elections, and possible post-election rally, all things being equal.
Technically, the NGX index action had extended its markup phase which had followed through to support the bullish V-shape pattern that indicates a reversal or continuation of trend on a daily and weekly time frame. Also, there is a convergence between the index’s action and MACD on a dally chart that supports uptrend, due to position taking in blue chip stocks. Let us keep our gaze on market forces and money flow.
To navigate the rest of the quarter 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 low volume of transaction witnessed, it is time to go shopping for undervalued stocks, sectors and the next insider playing opportunity.”
Oil price oscillation continued, as it pulls back to trade at $81.95 per barrel, despite the weak dollar and OPEC keeping to its output cut policy in the midst of recovery in China economy and rising attacked on Ukraine. Just as the geopolitical tension, high interest rate and inflation across the globe continue to threaten the world. Also, supply tightened due to the Russia-Ukraine war that has lingered so far. The up and down movement of oil price also continues to drive volatility across markets.
Thursday’s trading opened slightly in the upside and slide down in the mid-morning and thereafter retraced up for the rest of the session on demand for highly priced stocks, a situation that pushed the NGX’s index to an intraday high of 53.998.12 basis points from its low of 53,483.40bps, before closing sharply above its opening figure at 53,998.12bps.
Market technicals were positive and strong, with higher volume of trade, compared to the previous session in the midst of flat breadth on a buying pressure as revealed by Investdata’s Sentiments Report showing 100% buy position and 0% sell volume. The total transaction volume index stood at 8.60 points, just as momentum behind the day’s performance was strong as Money Flow Index looked up sharply at 81.29pts, from the previous day’s 63.57pts, indicating funds entered the market.
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Index and Market Caps
At the end of Thursday trading, the composite NGX All Share Index gained 498.44basis points, closing at 53,998.12bps, after opening at 53,499.68bps, representing a 0.93% growth, just as market capitalization rose by N271.49bn closing at N29.41tr from the previous day’s N29.14tr, which also represented a 0.93% appreciation in value.
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Meanwhile, the day’s upturn was driven by position taking in the shares of MTNN, Seplat, Geregu Power, NNFM, MRS Oil, FCMB, Fidelity Bank, Cornerstone, and International Energy, among others, which impacted positively on Year-To-Date gain to 5.36%. Market capitalization YTD gain stood at N1.53 tr, representing 5.36% above its opening level for the year.

Mixed Sector Indices
Sectorial performance indexes for the session were mixed, as the NGX Energy closed higher by 5.17%, while NGX Banking led the decliners after losing 0.44%. followed by Insurance with 0.39% Just as Industrial and Consumer goods were flat.
Market breadth turned positive sharply as advancers outnumbered decliners in the ratio of 27:13. As transactions in volume and value were up, after investors exchanged 2.87bn shares worth N8.07bn. Volume was driven by trades in Universal Insurance, Aiico, GTCO, Sterling Bank and Fidelity Bank.
MRS Oil and Northern Nigerian Flourmill were the best performing stocks, after gaining 10% and 9.88% respectively, closing at N17.60 and N8.90 per share respectively on the impact of the interplay of market forces and the earnings expectations. On the flip side, Sunu Assurance and Mutual Benefits Assurance lost 8.11% and 7.69% respectively, closing at N0.34 and N0.36 per share, purely on profit taking.

Market Outlook
We expect positive sentiment to continue on position and profit taking as portfolio rebalancing in the midst of impressive corporate earnings and divergence in fixed income rates and MPR, on more audited earnings expectations and election uncertainty. Any pullback at this point may add more strength to upside potential. As such, investors should take advantage of price correction. Also looking at the trends and events across the globe and domestically.

Crucial Announcement
As the new year begins, you need to get started with activities that will help you in achieving your goals for the year. To this end, I must tell you that events and activities that happened in 2022 will shape 2023.
As a result, it is only investors who have improved on their skills and knowledge that will be able to scale through and withstand circumstances beyond their control in the market.
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*This is not new because I have been talking about it for the Past 6 months*
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Please Pay N50,000 into InvestData Consulting Limited Zenith Bank 1013815737. After Payment Send the details of your payment including name, email address and phone number to 08028164085 to have your access sent to you.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdata.com.ng
ambrose.o@investdataonline.com
ambroseconsultants@yahoo.com
Tel: 08028164085, 08179547605