SAT 12 FEB, 2022-theGBJournal- NGX Exchange data shows that total turnover of 1.331 billion shares worth N22.700 billion in 24,039 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.785 billion shares valued at N19.614 billion that exchanged hands last week in 27,822 deals.
However, the five-week bullish run came to a halt this week, as investors took profits off dividend-paying stocks. Precisely, the local bourse recorded losses in three of the five trading sessions of the week, following profit-taking in the shares of OKOMUOIL (-10.0%), BUAFOODS (-4.0%), GTCO (-3.4%), SEPLAT (-2.3%) and MTNN (-1.2%).
Consequently, the All-Share Index shed 0.2% w/w to close at 47,202.30 points. Accordingly, the MTD and YTD returns moderated to +1.2% and +10.5%, respectively.
Trading in the top three equities namely Access Bank Plc, Guaranty Trust Holding Company Plc, and Fidelity Bank Plc, (measured by volume) accounted for 316.758 million shares worth N4.353 billion in 3,476 deals, contributing 23.80% and 19.18% to the total equity turnover volume and value respectively.
Activity levels were mixed as volume traded declined by 25.4% w/w while value traded rose by 15.4% w/w. Performance across sectors was broadly positive, as the Banking (+2.3%), Insurance (+1.5%), Consumer Goods (+1.3%), Oil and Gas (+0.3%), and Industrial Goods (+0.1%) indices all closed in green.
The Financial Services Industry (measured by volume) led the activity chart with 886.121 million shares valued at N10.058 billion traded in 11.563 deals; thus contributing 66.60% and 44.31% to the total equity turnover volume and value respectively. The Consumer Goods Industry followed with 107.592 million shares worth N4.472 billion in 3,833 deals. The third place was The Conglomerates Industry, with a turnover of 102.192 million shares worth N198.077 million in 1,008 deals.
Analysts at Cordros Research say they expect investors to take advantage of the moderation in the share prices to make a re-entry in dividend-paying stocks ahead of subsequent 2021FY earnings releases. However, they believe investors will remain reluctant to leave gains in the market.
‘’As such, we expect intermittent profit-taking to continue due to uncertainties about the direction of yields in the FI market. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings.’’
Meanwhile, global stocks posted broadly positive performances bolstered by solid earnings releases. However, global equities pared gains later in the week following hotter-than-expected US inflation data, which reignited fears of a more hawkish Fed. Accordingly, US (DJIA: +0.4%; S&P 500: +0.1%) stocks were set for a weekly gain following robust earnings from tech stocks.
European markets (STOXX Europe: +2.2%; and FTSE 100: +2.1%) were buoyed by the rebound in tourism stocks amid easing geopolitical tensions between Russia and Ukraine.
In Asia, the Japanese Nikkei 225: (+0.9%) was on course to end the week in the green on the back of the positive sentiments on Wall Street. Likewise, the SSE: (+3.0%) closed higher as gains in Chinese property developers and Alibaba Group Holding buoyed sentiments.
Emerging markets (MSCI EM: +2.5%) and Frontier (MSCI FM: +1.0%) market stocks mirrored the bullish trend across global stocks consequent upon gains in China (+3.0%) and Kuwait (+0.6%), respectively.
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