Nigeria stock market had a mixed session on Thursday in the early hours of the day’s trading when there was a heavy sell-off until the mid-afternoon when it turned around to reduce the day’s losses and close lower. It has been a mixed situation in the market this week as we have earlier mentioned in our weekly outlook with bullish sentiment that slowed down profit booking, coinciding with investors and traders’ reaction to the postponed reclassification of Nigeria into the MSCI Frontier Index of emerging market.
Thursday’s volume index was 0.97 and buying position of 45%, while selling volume was 55% of the total transactions for the day, against the previous day’s volume index of 0.96. Buying volume was 8%, while selling was 92% shows that selling pressure is reducing to give a balance market that will usher in a buying market in the nearest future.
Healthcare stocks have recently continued to rally in the market on the strength of policy change by government to source all the drugs and vaccines locally before looking elsewhere, a situation that is already impacting share prices in the sector. This is expected to grow the economy and develop the nation’s healthcare industry and reduce pressure on the forex market.
Meanwhile, at the close of the day’s trading session, the composite index NSEASI lost 549.45 basis points to close at 32,928.44 after opening at 33,477.89 points, representing a 1.64% decline on huge volume traded that was slightly higher, when compared to previous day’s transaction level. Similarly, market capitalisation for the day was down N190bn to close at N11.39tr from an opening value of N11.58tr, representing 1.64% decline in investors’ positions
Losses suffered in the share price of ETI, Julius Berger, Okomu Oil, NB, Stanbic IBTC, Zenith Bank, GTBank, Lafarge Africa, Mobil, Flourmills and 7-Up that impacted negatively on the All-Share index’s year-to-date returns, reducing it to 23.66%. Also, market capitalisation for the same period stood at N2.22tr, representing a 24.30% appreciation above the year’s opening value.
Market breadth for the day remained negative as the number of decliners outpaced advancers in the ratio of 45:14 on huge volume of trade to continue the two-day down market.
Market activities in terms of volume and value were mixed, as volume traded was up marginally by 0.22% to 509.76m shares from previous day’s 508.73m, while value was down by 21.41% to N5.03bn from previous day value of N6.4bn. Transactions in the shares of UBA, DIAMOND BANK, FBNH, ZENITH BANK and TRANSCORP topped the volume chart to close the day’s trade.
At the end of trading, Conoil topped the advancers’ log with its share price gaining 10.24% to close at N44.56 each on dividend of N3.10 and positive Q1 numbers that turned green from a red position. It was followed by Ashaka Cement 10.16% gain to close at N16.27per share, on market forces and expectation of north east reconstruction by the government.
On the flipside, May & Baker led the decliners’ log, dropping 9.62% to close at N4.98 on profit taking, while Transcorp followed with 9.52% to close at N1.52 each on profit taking.
As the market opens this morning, expect mixed action with less selling pressure as repositioning in value stocks continue. Investors should not panic on pullbacks if they have taken position based on strong numbers and future prospects of any stock.
Again, we advise that investors allow numbers to guide their decisions to reposition for the rest of the year’s trading activities, especially now that prices of stocks are looking up ahead of recovery economic fundamentals, if the numbers will support the price reversal or continuation.
It is time to use your technical tools to take decision by knowing the support and resistant level to reposition or exit any position.
Once more, at the risk of repeating oneself, we must reiterate that industry potential is very important when picking a stock, because there are factors that are sector-specific and would naturally impact positively or negatively on companies operating within such an industry, especially now that the economy is recovering. For stocks that should be on your shopping list to buy in this up market or pullback sign up for investdata buy & sell signal setup by calling 08032055467.
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