Market Update for June 16
Midweek’s transactions on the Nigerian Exchange maintained its volatility as the composite NGX All-Share index closed positive, thereby halting two trading sessions of bear transition on a renewed buying interest after a breakout of 39,000 level failed, pulling back on recent selloff and profit taking in high and low priced equities.
After Tuesday’s selloff and profit booking in Airtel Africa and Okomu Oil dragged down the NGX index down, the market reversed marginally after bargain hunters took position, as revealed by the high buying sentiments, high traded volume and positive market breadth at the end of the day’s trading. Although the candlestick formation was small, it signals a bottom pattern reversal with strength that needs to be confirmed at Thursday’s trading session, depending on market forces.
Oil price trading above $72 per barrel at the international markets, a situation that is expected to boost government revenue, and help it meet the growing expenditure, while hastening economic recovery, and reducing the debt overhang and borrowing propensity from the local and international capital market, if properly managed. We, however, note that the impact of the surge in oil price is yet to reflect on the Nigerian economy, which in it itself is a cause for concern and a pointer to the likelihood that demand for Nigeria’s oil is not as expected, while not forgetting the agreed OPEC+ production quota, among others.
Midweek’s trading started slightly on the downside, but oscillated till early afternoon before rebounding at the final minutes on buying interests in consumer goods and energy stocks, a situation that pushed the benchmark index to an intraday high of 38,564.70 basis points from its lows of 38,455.41bps.
Market technicals were positive and strong with volume traded higher than previous day’s in the midst of positive breadth and high buying pressure, as revealed by Investdata’s Sentiments Report showing 100% ‘buy’ volume. Total transaction volume index stood at 1.23 points, just as energy behind the day’s performance was relatively strong, as seen in the 58.84pts Money Flow Index, compared to previous day’s 60.13pts, indicating that funds left the market, despite the up market.
Index and Market Caps
The key performance NGXASI, at the end of day trading, gained a marginal 57.41bps to close at 38,564.70bps, from an opening level of 38,507.33bps, representing a 0.15% limp, just as market capitalization recovered N29.92bn, closing at N20.1tr, from its opening value of N20.07tr, also representing a 0.15% value gain.
Attention: If you have not signed up for INVESTDATA buy and sell signal setup, don’t delay. As the number of stocks entering their buy range have just increased to 15 as they build new bullish base to be in our watchlist. These stocks are with double potentials to rally considering their earnings prospect and oscillating mood of the market.
To become a member, send ‘YES’ or ‘STOCKS’ to the phone numbers below. Take advantage of this service to buy right and sell right at the current oscillating market in the midst of earnings season, portfolio reshuffling and repositioning as we await an economic reform policy to stimulate and re-track the economy again.
The session’s upturn followed accumulation and repositioning in Seplat, MTNN, Zenith Bank, Access Bank, Vitafoam, UACN, UBA, Africa Prudential, United Capital, Unilever, International Breweries, Honeywell, and Cornerstone Insurance, among others. This impacted mildly on Year-To-Date loss, reducing it to 4.23%, while the drop in market capitalization YTD amounted to N922.46bn, representing a 4.51% drop from its opening value for the year.
Mixed Sector Indices
Performance indexes across sectors were mixed, with the NGX Oil/Gas and Consumer Goods closing 0.92% and 0.18% higher respectively, while the NGX Insurance led the decliners, after shedding 0.51%, followed by Banking and Industrial goods with 0.32% and 0.03% respectively.
Market breadth also turned positive, as gainers outnumbered losers in the ratio of 27:21; while transactions in volume and value terms were mixed after players transacted 302.72m shares worth N2.81bn, compared to the previous day’s 297.35m units valued at N3.65bn. Volume was driven by trades in Sterling Bank, Ecobank Transnational Incorporated, Wema Bank, Guaranty Trust Bank and Japual Gold.
The best performing stocks of the session were Cornerstone Insurance and Morison Industries which chalked 10% and 9.68%, closing at N0.55 and N1.36 per share respectively on market forces. On the flipside, Abbey Building Society and Consolidated Hallmark Insurance lost 9.52% and 9.46% respectively, closing at N0.95 and N0.67 per share, on selloffs and profit taking.
Market Outlook
We see a rebound underway, as profit-taking may slow down while bargain hunters cash in on these pullbacks to position for quarter-end window dressing, seeming positive economic data ahead of March, April and May full-year earnings reports. We note that half-year interim dividend stocks are becoming more attractive at this point for income investors and traders, even as the market anticipates positive news, while oil price continues to oscillate above $72pb to support global economic and stock market recovery across climates. We also expect the ongoing COVID-19 vaccination to support global and domestic economic recovery that will enhance the market and give direction.
The banking sector and others remain attractive on the back of the prevailing low prices, despite the Q1 mixed numbers.
Again, the way to go is: Target dividend-paying stocks and fundamentally sound companies with growth prospects in 2021, looking the way of mispriced equities ahead of interim dividend announcement. This is especially given that despite the seeming improvements, fixed income yield continues to offer negative real rate of return due to the galloping inflation.
However, the strong and faster recovery may continue, depending on market forces, going forward, as propelled by expected Q2 earnings reports, until the next MPC meeting in July.
INVESTDATA 2021Q3 MASTERCLASS
Theme: Road Map For Improved Trading Results&Enhanced Confidence
Sub-Topics
- Building Wealth with Diversified Portfolios In Amidst Economic Recovery, Stagflation Alhaji KurfiGarba MD/CEO Apt Securities & Funds Ltd
- Combining Technical Indicators & Tools With Higher Time Frame To Initiate, Manage Trades Mr Abdul-Rasheed OshomaMomoh, Head Capital Market at Trw Stockbrokers Ltd
- Volume Factors That Give Profitable Signals in Any Market Phase, or Cycle, Mr Ambrose Omordion, Chief Research Officer, Investdata Consulting Ltd
Based on the changing market dynamics and trading environment, Investdata Master class will show you how to effectively combine fundamental and technical tools to read and analyses simultaneously for a true insight into market actions and direction.
This Master Class will cover
- Selecting portfolios that beat inflation in a recovery economy
- How to read the higher and trading time frame bars for a true trading edge.
- Knowing the factor that fuel stock market trading and how its impact your portfolio.
- Entry and exit technique that get you in and out at good prices and add to your bottom line.
- Improve your chances of entering wining trades, using volume factor and analysis to see what the market is doing more clearly and with a greater degree of confidence.
- 5 Hot inflation beating stocks
- Q3 trade ideas and sectorial indexes charting
Trading the equity market on minutes and day charts can be challenging, because things or events happen so fast. Volatility occurs first on the daily time frame, often with little or no warning.
Momentum indicators like RSI, MACD and moving average are useful, but most times they give false signals, making many traders miss opportunities and solid trades. But for you to pinpoint a winning trade and where smart money is moving with more accuracy, you need volume analysis and sentiment reports.
Date: July 3, 2021
Time: 9am prompt
Venue: ZOOM.
Fee: N 50,000
However, with less than 28 days to the beginning of Q3 2021, you need a road map to navigate the quarter profitably with confidence. Don’t miss this opportunity as we countdown to July 3, 2021 for this Master Class.
During this practical session, our team of experts will reveal practical trade ideas and opportunities that you can apply or implement immediately in Q3 2021 to consolidate your gains, maximize returns and start tracking the result by yourself.
If it is your desire to be among smart investors and traders in Q3, send Yes to: the phone numbers below now.
Meanwhile, the home study packs on Comprehensive Stock Market trading course video, 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, 08111811223 now.
Ambrose Omordion
CRO|Investdata Consulting Ltd
ambrose.o@investdataonline.com
Tel: 08028164085, 08179547605
