Sustained Bargain Hunting in Bellwethers Drives Equities Market

Photo L-R: Oyinda Akinyemi, Head, Equities Market,  Stanbic IBTC Capital; Aigbovbioise Aig-Imoukhuede, Managing Director, Coronation Asset Management; Oscar Onyema, Chief Executive Officer, The Nigerian Stock Exchange (NSE); Funso Akere, Chief Executive Officer, Stanbic IBTC Capital; Abubakar Jimoh, Managing Director/CEO, Coronation Merchant Bank Group; Manji Cheto, Business Development Manager, London Stock Exchange (LSE); Tony Ibeziako, Ag. Head, Listing Business Division, NSE and Ade Ewuosho, Ag. Head, Trading Business Division during a Closing Gong Ceremony at the Exchange on Monday


The domestic bourse extended its recovery to the second consecutive session as bargain hunting in bellwethers continues to drive performance. As a result, the NSE All Share Index (ASI) rose 2.5% to settle at 37,854.92 points while YTD return improved – although still negative – to -1.0%. The bullish performance recorded in today’s session was largely due to gains in DANGCEM (+2.2%), GUARANTY (+4.0%) and NIGERIAN BREWERIES (+5.0%). Accordingly, investors gained N328.8bn in value as market capitalization improved to N13.7tn. Activity level was mixed as volume traded rose 8.0% to N339.7m units while value traded weakened, down 15.2% to N6.0bn. The top traded stocks by volume were ACCESS (133.1m), GUARANTY (39.3m) and UBA (23.2m) while GUARANTY (N1.6bn), ACCESS (N1.4bn) and DANGCEM (N911.2m) were the top traded stocks by value.

Bullish Sector Performance
Sector performance was mostly bullish as 4 of the 5 indices under our watch closed in the green. The Industrial Goods and Banking indices trended northwards, up 3.2% apiece due to bargain hunting in DANGCEM (+2.2%), WAPCO (+5.0%), GUARANTY (+4.0%) and ZENITH (+4.0%). The Consumer Goods index followed closely, up 2.7% on the back of gains in NIGERIAN BREWERIES (+5.0%) and INTBREW (+7.7%) while the Insurance index closed 0.2% higher as a result of buying interest in WAPIC (+4.3%) and MBENEFIT (+2.6%). On the other hand, the Oil & Gas index emerged the lone loser shedding 0.6% on account of losses in TOTAL (-4.3%).

Investor Sentiment Further Strengthens
Investor sentiment as measured by market breadth (advance/decline ratio) strengthened to 2.6x from 1.0x in the prior session as 39 stocks advanced against 15 decliners. OANDO (+9.8%), INTBREW (+7.7%) and DANGSUGAR (+6.4%) were the top performing stocks today while HMARKINS (-6.7%), ROYALEX (-5.9%) and UACN (-4.8%) were the worst performers. In line with our expectations, today’s performance was largely driven by bargain hunting in large cap value stocks and we believe this will remain a key driver in the near term.