Anticipation of improved full-year 2021 earnings and dividend declarations triggered bargain-hunting in the equities segment of Nigeria’s capital market last week, as sentiments remained bullish, pushing the All-share index and market capitalisation by 1.37 per cent to close at 44,454.67 and N23.951 trillion respectively.
Similarly, all other indices finished higher except NGX CG, NGX insurance, NGX AFR Bank Value, NGX Consumer Goods and NGX Lotus II Indices, which depreciated by 0.79 per cent, 1.54 per cent, 0.07 per cent, 4.35 per cent and 1.34 per cent, respectively. The NGX ASem, NGX Growth and NGX sovereign bonds closed flat.
Analysts linked the performance to bargain hunters who were positioning ahead of more full-year earnings. Analysts at Cordros Capital said: “In the short term, we expect the bulls to retain dominance in the market given positioning for 2021FY dividends as institutional investors continue to search for clues on the direction of yields in the FI market.
“Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”
Vetiva Dealings and Brokerage said: “Market traded mixed this week, compared to the bullish sentiments seen last week as the All-Share index only returned 137bps against the 266bps in prior week.
“We saw investors taking profit on previous gainers and we still expect the market to trade mixed at the beginning of the new week amid improved activity levels.”
Afrinvest said: “In the coming week, we expect market performance to be a mix of profit-taking and bargain hunting activities.” Trading in the top three equities namely Transnational Corporation of Nigeria Plc, BUA Foods Plc, Jaiz Bank Plc (measured by volume) accounted for 775.685 million shares worth N16.625 billion in 2,644 deals, contributing 48.49 per cent to the total equity turnover volume.
Transactions in the shares of the three firms lifted the financial services industry as the sector led the activity chart with 731.264 million shares valued at 6.517 billion traded in 10,822 deals; thus contributing 45.71 per cent to the total equity turnover volume.
The conglomerate industry followed with 403.646 million shares worth N452.9 million in 1,537 deals. The consumer goods industry ranked third with a turnover of 314.768 million shares worth N17.8 billion in 4,101 deals.
Consequently, a total turnover of 1.6 billion shares worth N32.716 billion in 22,607 deals was traded by investors on the floor of the Exchange past week, in contrast to a total of 2.027 billion shares valued at N59 billion that was exchanged during the preceding week in 15,750 deals.
Also, 78,135 units of bonds, valued at N78.6 million were traded this week in 25 deals compared with a total of 50,225 units valued at N50.8 million transacted last week in 13 deals.
Thirty-three equities appreciated during the week, lower than 40 equities in the previous week. Thirty-five equities depreciated, higher than 31 equities in the previous week, while 88 equities remained unchanged lower than 84 equities recorded in the previous week.