Roller Coaster Week! Stock Market Down For The Week!

It has been a roller coaster week in the stock markets this whole week. Starting from the marginal drop on Monday Tuesday & Wednesday, Thursday to the false hope with intraday points higher than Wednesday and finally the dashing of all hopes again on Friday (down -2.2% closing at 35,446.50).

Overall, the NSEASI has lost 2.90% this week. Such a whipsaw market has made it extremely difficult for swing traders to take positions and has kept fundamentalists guessing all week. It was clear this whole week that even interim news from GTB and Zenith bank have almost no authority in predicting where the market might go in the short term at all.

NSEASI WEEKLY CHART

However, technical analysis on the markets still tell a more congruent tale.

The Market as it is on the Chart is within a pyramid from August 2017-2018 with support

within the 35,400 points range.

Though we still expect some bearish sentiment in the coming Months/Weeks (breaking the support Triangle and hitting 34,000 points range)

For now, short term sentiments remain healthy for a rebound this week if closing with a long tail bullish harami within the (50% Fibonacci levels 35,192 range)on their current support levels.

Happy trading

Watch the 50% fibs of 35,192 and 61.8% fibs of 34,174 points

NSEASI Weekly Chart

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SEC Issues Deadline For Registration Of Unlisted Securities

The News Agency of Nigeria reports that NASD PLC is the promoter of the OTC trading platform that eases secondary market trading of all unlisted securities in the country.

The Securities and Exchange Commission on Friday issued December 31 deadline to public companies to register all their securities with the commission to boost the NASD Over-The-Counter market.
The News Agency of Nigeria reports that NASD PLC is the promoter of the OTC trading platform that eases secondary market trading of all unlisted securities in the country.
Mary Uduk, SEC Acting Director-General, disclosed this at the second post Capital Market Committee meeting in Lagos.
Uduk said all public companies in Nigeria had till the end of this year to ensure that trading in their securities was done through SEC approved platform.
She said: “Already, the commission has distributed letters to all registrars to fast track compliance with the rule and ensure that public companies abide by the stipulated deadline.”
According to her, to accelerate compliance, the commission will ensure that companies filing their returns must provide evidence in form of letters to show due registration with the regulatory authority.
Uduk said the commission had identified companies with shares trading actively on the OTC platform without registering their securities with the apex regulator.
She said: “If companies are bringing returns to us, we will check if the company has registered the securities with SEC, if yes, then the company must provide evidence of SEC registration letter.”
Uduk said the commission might decide to adopt other means to ensure compliance after the December 31 deadline.
Speaking on measures to make the primary market more active, she said the commission would streamline the entire issuing process, in addition to the issuing cost reduction achieved in 2017.
The measure, according to Uduk is to fast-track the entire process of raising bonds and equities in the capital market and makes the issuing process more attractive to investors.
She said: “We are almost through with the report.
“We are working with the Nigerian Stock Exchange to ensure that any document filed with the exchange is not requested for a second filing at the SEC to fast tract the system.”
Uduk noted that an impact assessment made on the cost reduction for primary equity and fixed income issues last year impacted on the market and attracted more issuers to the market.
She said: “After one year we did an impact assessment to see how the cost reduction impacted to market.”
NAN reports that in March, 2017, the commission released a draft rule seeking reduction in cost of primary equity and fixed income issues by various trade groups in the capital market.

NSE: Investors lose N287 billion amid profit taking

Following persisted profit taking by investors on the Nigerian Stock Exchange (NSE), on Friday, the market capitalisation shed N287 billion or 2.17 per cent to close at N12.941 trillion against N13.228 trillion on Thursday.

Similarly, the NSE said the All-Share Index lost 786.19 points or 2.17 per cent to close at 35,446.47 compared with 36,232.66 on Thursday.

Dangote Cement topped the laggards’ chart, losing N14 to close at N214 per share.

Total trailed with a loss of N5 to close at N185, while Lafarge Africa lost N1.90 to close at N28 per share.

GlaxosmithKline shed N1.70 to close at N15.30, while ETI declined by N1.10 to close at N21.05 per share.

Conversely, Mobil Oil led the gainers’ table, gaining N6 to close at N176 per share.

International Breweries came second with a gain of N1 to close at N32, while Eterna gained 45k to close at N6.55 per share.

FBN Holdings appreciated by 10k to close at N9.60, while Oando also increased by 10k to close at N5.55 per share.

In spite of the drop in market indices, the volume of shares traded closed higher as investors bought and sold 192.99 million shares valued at N2.03 billion exchanged in 3,025 deals.

This was in contrast with a turnover of 188.26 million shares worth N1.29 billion achieved in 2,795 deals on Thursday.

United Bank for Africa was the most active stock during the day, exchanging 52.10 million shares worth N496.19 million.

Transcorp came second with 18.52 million shares valued at N21.63 million, while Courteville sold 14.73 million shares worth N3.07 million.

The News Agency of Nigeria (NAN) reports that Zenith Bank traded 11.83 million shares valued at N279.11 million.

GUARANTY TRUST BANK PLC – APPOINTMENT OF EXECUTIVE DIRECTOR

TA Signals for August 10 2018

NEW HIGH LOW

SUPPORT AND RESISTANT

TA SIGNALS

VOLUME PRICE ANALYSIS

NSE PRICE LIST FOR AUGUST 10 2018

TRW_STOCKBROKERS_stxpricemove_d_all-2018-08-10 14_38_05.647

Commercial papers will increase credit flow to economy – Analyst

By Sunday Michael Ogwu,

Analysts at FSDH Research have said the recent statement by the Central Bank Nigeria governor at the end of the last  Monetary Policy Committee (MPC) meeting is encouraging large corporations to issue Commercial Papers (CPs), which may be bought by the apex bank if necessary, and increase credit creation and business expansion.
The head of research, Ayodele  Akinyunmi, disclosed this at the monthly meet with newsmen in Lagos yesterday.

Akinyunmi said while FSDH Research believes these measures may increase credit creation and business expansion to stimulate growth, complementary fiscal measures are required to de-risk the economy.
At the end of its July 2018 meeting, the MPC maintained the Monetary Policy Rate (MPR) at 14%, with the asymmetric corridor at +200 and -500 basis points around the MPR. It retained the Cash Reserve Ratio (CRR) and Liquidity Ratio (LR) at 22.50% and 30%, respectively. However, it intends to deploy unconventional strategies to boost credit creation and economic growth.
FSDH Research believes this measure will increase the issuance of CPs in Nigeria in HY2, 2018. The yields on the CP may also drop or trail the yields on the Nigerian Treasury Bills (NTBs).
“The measure will reduce the financial cost for large corporates and increase their profitability. Similarly, the CBN plans to implement measures to direct Cash Reserve Requirement (CRR) funds to the manufacturing and agriculture sectors of the Nigerian economy at 9% interest rate with a minimum tenor of 7 years and moratorium period of 2 years.” He added.
Meanwhile, data from CBN shows that net domestic credit decreased marginally by 0.57% to N25.72trn in May 2018, from N25.86trn in December 2017. The net credit to the private sector shrank marginally by 0.37% to N22.21trn during the same period.
On the equity market depreciation  in July 2018, following the appreciation recorded in June, FSDH Research believes the equity market is approaching an oversold position. There may be a reversal of the downward trend as the economic fundamentals support a recovery in the equity market.
In June, Nigeria Stock Exchange All Share Index (NSE ASI) depreciated by 3.29% (a loss of 3.34% in US dollars) to close at 37,017.78 points. Year-to-Date (YTD), the Index recorded a depreciation of 3.20%.
Similarly, the market capitalisation recorded a M-o-M loss of 3.29% (a loss of 3.34% in US dollars) to close at N13.41tn (US$43.84bn).