SAT 05 MARCH, 2022-theGBJournal- Although the local bourse opened the week on a strong footing, the bullish momentum lost steam as investors took a breather later in the week to digest corporate earnings released thus far.
A total turnover of 1.374 billion shares worth N23.786 billion in 28,809 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.668 billion shares valued at N19.481 billion that exchanged hands last week in 25,979 deals, according to NGX Exchange data.
Midweek selloffs undermined the market performance as the NGX All-Share Index settled 0.1% lower to close at 47,268.61 points. Particularly, intense profit-taking activities witnessed in INTBREW (-9.1%), WAPCO (-8.8%), NASCON (-8.3%), DANGSUGAR (-7.7%), UBA (-5.2%), and GUINNESS (-4.4%) drove the weekly loss. Consequently, the MTD and YTD return for the index moderated to -0.3% and +10.7%, respectively.
In terms of activity levels, trading volume declined by 17.2% w/w, while trading value grew by 22.8% w/w. On sectors, the Oil and Gas (+10.6%) index was the lone advancer while the Banking (-2.7%), Consumer Goods (-1.7%), Industrial Goods (-0.7%), and Insurance (-0.2%) indices declined.
Trading in the top three equities namely FCMB Group Plc, Transnational Corporation of Nigeria Plc and Zenith Bank Plc (measured by volume) accounted for 416.676 million shares worth N2,989 billion in 3,321 deals, contributing 30.32% and 12.57% to the total equity turnover volume and value respectively.
We expect investors to take advantage of the significant moderation in the share prices to make a re-entry in dividend-paying stocks in the week ahead. However, we envisage a zig-zag pattern as intermittent profit-taking activities will likely persist due to medium-term expectations on the direction of yields in the FI market.
Meanwhile, like the prior week, global stocks tumbled as investors fled to safe-haven assets amid fears of a potential nuclear disaster following reports that Russia’s gunfire caused a fire at Europe’s largest nuclear plant.
Furthermore, mounting concerns over the economic impact of Russia’s invasion of Ukraine and expanding international sanctions on Moscow continued to weigh on sentiments.
Accordingly, US (DJIA: -0.8%; S&P 500: -0.5%) stocks were on track to close the week in the red. European stock markets (STOXX Europe: -3.6%; and FTSE 100: -3.3%) were on course for another weekly loss as signs that Russia’s invasion of Ukraine was intensifying drove selloffs in banking and auto stocks.
Asian markets posted broadly negative performances, as the Nikkei 225 (-1.9%) settled lower taking a cue from the selloffs on Wall Street. Similarly, the SSE (-0.1%) declined marginally despite investors’ negative reaction to the Russia-Ukraine war-led damages to a nuclear power plant.
The Emerging (MSCI EM: 0.0%) markets stocks were unchanged while the Frontier (MSCI FM: -2.2%) market stocks mirrored the downtrend in global equities consequent upon losses in Nigeria (-0.1%).
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