NGX Appreciates as Bargain Hunting Drives Weekly Gain

NGX Appreciates as Bargain Hunting Drives Weekly Gain

The Nigerian Exchange (NGX) appreciates this week as the local bourse extended its positive performance due to an improvement in investor sentiment. The domestic bourse managed to eke out a weekly gain despite profit-taking activities, as the All-Share Index ended the week 0.1% higher at 38,962.28 points.

Gains in OKOMUOIL (+5.6%), following renewed investors’ interest, managed to offset the declines in ZENITH BANK (-1.3%) and GTCO (-0.9%) this week.

The moderate buying interest drives price appreciations in some mid to large-cap stocks, this stock market year to date losses moderated to 3.2%. Similarly, with positive momentum, market capitalisation jumped ₦9.6 billion this week to ₦20.3 trillion. Month to date loss reduced to 0.7%.

Market data shows that trading activity increased as average volume and value traded rose 49.6% and 29.5% in the week to 256.2 million units and ₦2.8 billion respectively.

The top traded stocks by volume were UBA (72.4 million units), GTCO (46.3 million units), and ZENITH (40.8 million units) while MTNN (₦1.0 billion), ZENITH (₦939.5 million), and UBA (₦552.4 million) led trades by value.

Afrinvest said the stock market performance was mixed across sector under its coverage as 3 indices closed positive, 2 negatives while the AFR-ICT index closed flat.

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Extending last week’s gain, the Insurance index advanced 1.7% this week due to buying interest in MBENEFIT (+3.4%) and AIICO (+1.1%). Similarly, the Oil & Gas and Industrial Goods indices gained 1.4% and 0.2% during the week respectively on the back of price appreciation in CONOIL (+14.1%), OANDO (+6.7%), and WAPCO (+4.2%).

Meanwhile, the Banking and Consumer Goods indices lost 40 and 4 basis points week on week respectively following sell pressure on UBA (-1.3%), ZENITH (-1.3%), HONYFLOUR (-5.0%), and UNILEVER (-2.2%).

Investor sentiment strengthened this week, as market breadth (advance/decline ratio) doubled to 1.2x, aided by gains in 26 stocks against 21 losers. The top performing stocks for the week were PHARMDEK (+32.1%), NAHCO (+15.1%), and CONOIL (+14.1%) while SCOA (-17.9%), PRESCO (-8.2%), and NEIMETH (-7.9%) led the laggards.

“In the coming week, we expect the momentum on the local bourse to remain elevated on improved investor sentiment”, analysts said.

Codros Capital analysts expect savvy investors to take advantage of the moderation in the share prices of bellwether stocks to make a re-entry in the week ahead.

However, analysts said they expect intermittent profit-taking activities to persist as investors search for clues on the direction of yields in the fixed income market. 

“Accordingly, we think the market will exhibit a choppy pattern. Overall, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings”, analysts projected.

NGX Appreciates as Bargain Hunting Drives Weekly Gain