*Analysts expect positive trading amid expectation of interim dividend payout
At the close of trading activities for last week, the Nigerian Exchange Limited (NGX) equities market gained 1.90 per cent, due to the impressive first half (H1), 2021 earnings corporate results.
Projecting for the new week, analysts expected the equities market to trade positive as investors’ position ahead in stocks of companies that are expected to pay interim dividends.
It is, however, worthy of note that last week was a brief trading week as the Federal Government of Nigeria declared Tuesday and Wednesday, July 20 and 21, 2021 as Public Holidays to commemorate the Eid el-Kabir celebration.
Based on the preceding, the All-Share Index advanced by 720.72 basis points or 1.90 per cent week-on-week (W-o-W) to close at 38,667.90 basis points. Similarly, the market capitalisation increased by N376 billion in value to close at N20.147 trillion.
Performance across sectors was bullish; the NSE Oil & Gas increased by 7.53 per cent to close at 363.02 points while the NSE Banking, NSE Consumer Goods and the NSE Industrial indices rose by 0.44 per cent, 0.57 per cent and 4.06 per cent to close at 384.99 points, 597.32 points and 2,001.80 points respectively. On the flip side, the NSE Insurance index fell by 0.74 per cent to close at 200.02 points.
Market breadth for the week was positive as 43 equities appreciated at price, 16 equities depreciated in price, while 97 equities remained unchanged. Cutix Plc led the gainers’ table by 32.51 per cent to close at N4.81, per share.
Total Nigeria followed with a gain of 20.95 per cent to close at N203.20, while Oando went up by 20.67 per cent to close to N3.97, per share.
On the other side, Smart Products Nigeria led the decliners table by 38.46 per cent to close at 16 kobo, per share. Sovereign Trust Insurance followed with a loss of 12.12 per cent to close at 29 kobo and AIICO Insurance declined by 7.83 per cent to close at N1.06, per share.
Overall, a total turnover of 896.174 million shares worth N5.235 billion in 11,714 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 1.008 billion shares valued at N10.923 billion that exchanged hands prior week in 17,297 deals.
The Financial Services Industry (measured by volume) led the activity chart with 718.570 million shares valued at N3.009 billion traded in 6,223 deals; contributing 80.18 per cent and 57.48 per cent to the total equity turnover volume and value respectively.
The Consumer Goods followed with 46.437 million shares worth N948.489 million in 1,856 deals, while Conglomerates Industry pulled a turnover of 39.798 million shares worth N207.132 million in 366 deals.
Trading in the top three equities namely Jaiz Bank, Sterling Bank and Fidelity Bank (measured by volume) accounted for 369.879 million shares worth N385.516 million in 785 deals, contributing 41.27 per cent and 7.36 per cent to the total equity turnover volume and value respectively.
On Exchange Traded Products (ETPs) platform, a total of 8,032 units valued at N1.864 million were traded last week in 19 deals compared with a total of 7,403 units valued at N486,759.25 transacted the previous week in 17 deals, while on the Bond market, a total of 11,776 units valued at N12.167 million were traded last week in 10 deals compared with a total of 29,583 units valued at N29.805 million transacted previous week in 12 deals.
Capital market analysts, however, noted that impressive H1 earnings results from Total Nigeria and Unilever Nigeria buoyed performance in the domestic equities market as the benchmark index recorded gains on all three trading sessions for last week.
Analysts at Cowry Asset Management Limited expected the equities market to trade positive as investors’ position ahead in stocks of companies that are expected to pay interim dividends.
Afrinvest Limited stated that “In the coming week, we expect the positive momentum to be sustained, as more impressive H1, 2021 earnings results are churned out.”
In the week ahead, analysts at Cordros Capital Limited believed investors will be focused on the outcome of the MPC meeting to gain further clarity on the movement of yields in the fixed income (FI) market.
“We also expect the Nigerian Exchange (NGX) floor to be flooded with corporate earnings as more companies publish their unaudited H1, 2021 numbers, accompanied by dividend declarations.
We believe this should provide respite for market performance. Overall, we advise investors to take positions in only fundamentally justified stocks as the weak macro story remains a significant headwind for corporate earnings,” Cordros Capital noted.