Investors Stake N20bn on Shares amidst Bearish Trading

Goddy Egene

It was a week that the bears dominated trading at the stock market, contrary to expectations that the gains posted the preceding week would be sustained. The market had recorded a marginal growth of 0.09 per cent two weeks ago, following investors’ reaction to the financial results of companies for the half year ended June 30, 2018. Although more results were released last week, bouts of profit taking and bargain hunting, especially in bellwethers caused the Nigerian Stock Exchange (NSE)All-Share Index to lose 0.37 per cent. Consequently, the NSE ASI closed at 36,499.67, while market capitalisation ended at N13.322 trillion. The market appreciated three out of the five days. But the two days of losses offset the impact of gains in the other sessions. Hence, as the NSE ASI closed the week lower. However, the value of shares traded rose to N20.316 billion staked on 1.391 billion shares compared with N16.739 billion invested in 1.417 billion shares the previous week.

Daily Performance

The market opened the week on positive note as the NSE ASI appreciated by 0.84 per cent to be at 36,946.05. Similarly, the market capitalisation appreciated by 0.84 per cent to close at N13.38 trillion. The positive performance was due to investors’ continued response to favourable corporate earnings for the half year ended June 30, 2018. The year- to- date decline of the NSE ASI improved to 3.39 per cent. In all, 32 stocks advanced in price, while 22 depreciated. Seplat Petroleum Development Company Plc and Mutual Benefits Assurance Plc led the gainers, chalking up 10 per cent apiece to close at N687.50 and N0.33 per share respectively. Northern Nigerian Flour Mills Plc trailed with 9.9 per cent, just as Neimeth International Pharmaceuticals Plc and Oando Plc garnered 9.5 per cent each. Conversely, Conoil Plc and Pharm Deko Plc led the bears, shedding 10 per cent apiece, followed by Medview Airline Plc with a decline of 9.8 per cent. Redstar Express Plc and Transcorp Hotels Plc closed 9.6 per cent and 9.4 per cent lower in that order. Analysts at Meristem Securities said bargain hunting on bellwether stocks across sectors, particularly in the banking and the oil & gas spaces drove the market to a positive close on that day. “We expect this trend to persist in the coming trading days, as we expect positive earnings releases flood the market,” they said. But on Tuesday, the market sustained positive momentum following gains by bellwether tickers such as Nestle Nigeria Plc, Seplat Petroleum Development Company Plc, FBN Holdings Plc and Nigerian Breweries Plc. The market appreciated by 0.19 per cent to close above 37,000 threshold. Although there were a total of 17 price gainers, lower than the 24 price losers, the NSE ASI closed higher at 37,017.78 following appreciation recorded by highly capitalised counters. As a result of the positive close, the year- to- date decline further improved to 3.20 per cent. On that day, Sunu Insurance Plc led the price gainers with 10 per cent, trailed by Prestige Assurance Plc with 9.6 per cent rise, just as Mutual Benefits Assurance Plc chalked up 9.0 per cent. Neimeth International Pharmaceu- ticals Plc, Union Diagnostic, and Nestle Nigeria Plc went up by 8.7 per cent, 8.3 per cent and 6.5 per cent in that order. Conversely, on that day, Diamond Bank Plc and Okomu Oil Palm Plc led the price losers with 10 apiece, followed by Jaiz Bank Plc with 9.3 per cent. Transnational Corporation of Nigeria Plc shed 6.9 per cent, while PZ Cussons Nigeria Plc went down by 5.6 per cent. Meanwhile, market turnover closed lower as volume of shares traded fell by 23.3 per cent compared with a growth of 2.5 per cent the previ- ous day. Investors traded 244.965 million shares worth N4.495 billion in 5,943 deals. However, the gains recorded during the past four days were eroded on Wednesday as the market returned to the control of the bears. As a result, the NSE ASI fell by 1.09 per cent to close at 39,031.72, while market capitalisation shed N146.7 billion to close lower at N13.3 trillion. On Wednesday, Depreciation in stocks such as Nestle Nigeria Plc, Dangote Cement Plc, Access Bank Plc and FBN Holdings Plc were responsible for the decline recorded. In all, 24 stocks shed value led by CAP Plc and Royal Exchange Plc with 10 per cent apiece. International Breweries Plc followed with 9.7 per cent, while Unity Bank Plc and Sunu Assurance Plc went down by 9.3 per cent and 9.0 per cent in that order. On the positive side, 21 stocks gained led by Neimeth International Pharmaceuticals Plc with 10 per cent. Jaiz Bank Plc trailed with 8.4 per cent, just as Okomu Oil Palm Plc and Mutual Benefits Assurance Plc chalked up 8.4 per cent and 8.3 per cent respectively. Positive sentiment returned on Thursday with the NSE ASI rose 0.21 per cent to close at 36,688.91. Despite the loss recorded in the Consumer goods and Industrial goods spaces, bargain hunting on counters in the banking and insurance sectors, secured a positive close to the market. A review of the sectoral performance indicated that two of five tracked indices closed in the green. The NSE Banking Index rallied 2.4 per cent followed by the NSE Insurance Index that rose 0.6 per cent. On the flipside, the NSE Consumer Goods Index closed in the red trailed by the NSE Industrial Goods Index and NSE Oil & Gas Index respectively.

Market Turnover

Meanwhile, an analysis of the trading activity showed that the Financial Services Industry led with 824.153 million shares valued at N9.274 billion traded in 11,620 deals, thus contributing 59.23 per cent and 45.6 per cent to the total equity turnover volume and value respectively. The Services Industry followed with 308.871 million shares worth N1.256 billion in 610 deals. The third place was occupied by Consumer Goods Industry with a turnover of 86.151 million shares worth N8.073 billion in 3,103 deals. Trading in the top three equities namely(Nigerian Aviation Handling Company Plc. Plc, United Bank for Africa Plc and Zenith Bank Plc) accounted for 460.997 million shares worth N5.273 billion in 2,513 deals, contributing 33.1 per cent and 25.9 per cent to the total equity turnover volume and value respectively. Also traded during the week were a total of 2,304 units of Exchange Traded Products (ETPs) valued at N376,541.65 executed in 16 deals, compared with a total of 344 units valued at N50,021.24 that was transacted in five deals the previous week. Similarly, a total of 16,463 units of Federal Government Bond valued at N18.200 million were traded last week in 27 deals compared with a total of 7,518 units valued at N7.668 million transacted in nine deals two week ago.

Price Gainers and Losers

A look at the price movement chart showed 34 gainers higher than 31 in the previous week, while 48 equities depreciated same as the previous week. Union Diagnostic & Clinical Services Plc led the gainers with 50 per cent, trailed by Neimeth International Pharmaceuticals Plc with 42.8 per cent. Mutual Benefits Assurance Plc chalked up 23.3 per cent, just as Niger Insurance Plc garnered 15.3 per cent. Other top price gainers for the week were: Seplat Petroleum Development Company Plc (13.6 per cent); LASACO Assurance Plc (12.5 per cent); Consolidated Hallmark Insurance Plc (11.1 per cent); Beta Glass Plc, Sunu Assurance Plc (10.0 per cent each); Northern Nigeria Flour Mills Plc ( 9.9 per cent). Conversely, Smart Products Nigeria Plc led the price losers with 18.5 per cent, trailed by International Breweries Plc with 17.5 per cent. Diamond Bank Plc shed 16.4 per cent, while Pharma-Deko Plc and Skye Bank Plc went down by 11.4 per cent. Other top price losers included: Secure Electronic Technology Plc, Conoil Plc, CAP Plc, Royal Exchange Plc (10 per cent apiece); and Medview Airline Plc (9.8 per cent).