Equities: Q2/H1 results to dictate market trend

. Dangote, FCMB, FIdelity, others expected

With the consistent gains recorded recently in Nigeria’s capital market, analyst expects profit taking to commence, except companies release a “better-than-last year’s declarations” in an outbreak of results expected this week.

Some of the results expected this week are, Nigerian Breweries, Nestle, Dangote Cement, CCNN, Diamond Bank, Sterling Bank, FCMB, FO, Dangote Sugar, Axamansard, Fidelity, Total and Continsure.

However, equities trading on the floor of the Nigerian Stock Exchange posted a total growth of N261 billion or 2.28 per cent in the week ended 21st July 2017, as the NSE All-Share Index and Market Capitalization closed the week at 34,020.37 points and N11.725 trillion respectively.

Trading activities were broadly bullish during the week, as the market closed positive on all the trading sessions, driven by investors’ bargain hunting in value stocks ahead of Q2/H1 earnings releases, further improving the MtD and YtD returns to 2.73% and 26.59%, respectively.

Last week ended with other sectoral indices finishing higher with the exception of the NSE’s Insurance Index that depreciated by 2.81% while the NSE ASeM index closed flat.

Spiked by investors’ interest, following the release of impressive Q2 results by Unilever prior week and Lafarge, the Industrial Goods and Consumer Goods Indices recorded the biggest weekly gains with a growth of 6.97 per cent and 2.97 per cent.

Though the banking sector traded negative for the first two days of the week, interest was renewed on Wednesday till the end of the week, as the news of board meetings for interim dividends and consequent approval of half year results have begun to filter in.

The total volume of stocks moved during the week was also on the upside, with a growth of 185%.

Investors moved 3.628 billion shares worth N34.886b in 19,834 deals in contrast to a total of 1.272 billion shares valued at N13.993 billion that exchanged hands previous week in 19,385 deals.

Stocks that spurred turnover were United Bank for Africa Plc (following the crossing of 2,080,104,955 shares to the bank from the Staff Share Investment Trust Scheme), Continental Reinsurance Plc and Niger Insurance Plc. Together, they accounted for 2.515 billion shares worth N20.825b in 1,191 deals, contributing 69.33% and 59.69% to the total equity turnover volume and value respectively.

The Financial Services Industry led the activity chart by volume with 3.393 billion shares valued at N28.711 billion traded in 11,237 deals; thus contributing 93.55% and 82.30% to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 79.473 million shares worth N3.418b in 3,101 deals. The third place was occupied by Conglomerates Industry with a turnover of 70.175 million shares worth N113.486 million in 872 deals.
An analysis of the stock performance for the week revealed the top three most rallied stocks at the NSE, were led by Skye Bank.

This is coming on the heels of the Bank being re-instated as the chief collector of IGR in Kogi state, as well as, the Central Bank of Nigeria’s pledged continued support for the bank still struggling to rise above murky investment waters it found itself last year.

A breakdown of how these stocks fared showed Skye Bank recorded a 19.67 per cent growth to close at 73 kobo per share, Unilever was next with a growth of16.12 per cent amidst impressive half year results released Last Friday.

The stock closed at N38.32 per share, while Lafarge closed 15.38 per cent higher or gained a whopping N8 in the just concluded week to close at N60 per share also on account of the company’s profitable 2017 half year results published recently via the NSE.

On the other hand, AXA Mansard led the losers chart by a dip of 8.97 per cent in its share price to close the week at N2.03 per share, A.G. Leventis dropped 7.69 per cent and closed at 72kobo per share, while NAHCO depreciated 6.02 per cent and closed at N2.81 per share.