Market Update for August 22
The nation’s equity market on Tuesday continued its volatility, closing higher as technical indicators remained mixed, as it opened with big gap up and a very strong run in the early hours of the trading session which was sustained. The index exploded on value gained by high cap stocks as investors expected the rebound of commodity price to influence oil stocks, especially those that are into crude oil related businesses and whose bottom-line would be impacted positively should the recovery in oil price be sustained.
By mid-afternoon, the bench-mark Nigerian Stock Exchange All-Share index consolidated in a three-wave correction mode, before taking off again, forming late mini flags which popped just before the session closed. In the last 40 minutes of trading, the index pulled back to end the session very strong, after touching an intraday high of 37,074.42 and low of 36,572.06 on a low transaction volume for the day, with market breadth going flat.
Market sentiment on Tuesday turned positive from a high selling pressure to increasing demand for stocks as revealed by volume traded index of 0.43. Buying position stood at 78% while selling volume was 22% of total transaction which was a reversal of previous day’s negative sentiments as half year financials of Access Bank, UBA, Stanbic IBTC and Fidelity Bank are expected in the market any moment from now.
At the close of the day’s session, the composite NSE ASI gained 378.04 basis points to close at 36,962.48 point, compared to the 36,584.44 points opening level, representing a 1.03% growth on a low volume traded, when compared to previous sessions. Similarly, market capitalisation was up by N129.44bn, closing at N12.74tr, from an opening value of N12.61 tr, representing a 1.03% appreciation in investors’ position.
The value gained in the share prices of Total, Nestle, UBA, Dangote Cement, Forte Oil, Oando, Guaranty Trust Bank and Dangote Sugar impacted positively on the ASI’s year-to-date returns which rose to 37.54%, just as market capitalisation stood at N3.49tr within the period, representing 37.78% above the year’s opening value.
Market breadth for the day was at equilibrium with advancers and decliners in the ratio of 22:22 on a low volume of trades to reverse Monday down market.
Trading activities in terms of volume and value were down by 33.68% and 41.67% respectively at 244.32m shares, worth N3.67bn, as against previous day’s 368.38m units, valued at N6.27bn.
Also, transactions in the shares of Livestock Feeds, Guaranty Trust Bank, UBA, Sterling Bank and Dangote Sugar topped the volume chart.
At the end of the day’s trading session, Total Nigeria topped the advancers’ table, gaining 5.00% to close at N239.51 each on market forces. It was followed by Caventon with a 5.00% gain at N1.05 per share, on market forces.
On the flipside, Conoil lost 9.74% to close at N30.59per share on profit taking; ahead of the 5.00% slide in the price of Mobil to close at N213.81 per unit on profit taking and unimpressive Q2 numbers.
TODAY’S OUTLOOK
As trading activities opens this morning, expect volatility to continue amidst profit taking and accumulation of interim dividend paying stocks ahead of their half year results, especially with numbers from the two first tier banks giving insights into what should be expected. As investors also take advantage of correction to position for the rest of the year, if the much desired economic recovery becomes a reality despite the slow and unclear implementation of the 2017 budget by the government. Even so, the July inflation figures and Nigeria’s second quarter GDP data are being awaited from the Nigeria’s National Bureau of Statistics (NBS) to officially confirm economic state and direction.
However, investors need not panic if they take position based on strong numbers and future prospects of any stock. Since there is no bad news in the market.
Again, we advise that investors allow numbers to guide their decisions while repositioning for the rest of the year’s trading activities, especially now that prices of stocks are looking up ahead of the improving economic fundamentals.
It is time to use your technical tools to take decision by knowing the support and resistant level to reposition or exit any position.
Be reminded once more that industry potential, market timing are very important when picking a stock, because there are factors that are sector-specific and would naturally impact positively or negatively on companies operating within such an industry, especially now that the economy is recovering. Market is in phases know it in order to manage your trading and investing risk. For stocks that should be on your shopping list to buy in this oscillating market or pullbacks sign up to INVESTDATA BUY AND SELL signal setup by calling 08032055467.
Get your home study pack today and ride with the current recovery on Nigeria’s stock market and economy. By investing and trading knowledgeable
The workshop video can be viewed on your phone, laptop and television set. The home study pack costs N20,000 including DHL delivery at your door step. Payment should be made into Investdata Consulting Ltd, Zenith Bank 1013033032. Afterwards, kindly send payment details to 08032055467 or 08111811223.
MR. OMORDION AMBROSE
CHIEF RESEARCH OFFICER
INVESTDATA CONSULTING LIMITED
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467
