SAT 02 APRIL, 2022-theGBJournal| Bearish sentiments persisted in the local bourse for the third consecutive week as profit-taking activities dominated market performance with the benchmark index recording losses in three of the five trading sessions.
The All-Share Index ended the week 0.3% lower to close at 46,842.86 points consequently, the lowest point since 31 January 2022. Market Capitalization also depreciated by 0.26% to close at N25,253 trillion.
A total turnover of 1.289 billion shares worth N13.546 billion in 22,118 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.176 billion shares valued at N16.601 billion that exchanged hands last week in 21,076 deals, according to NGX Exchange data.
Notably, selloffs of TOTALENERGIES (-10.0%), NB (-9.1%), INTBREW (-8.1%), GTCO (-7.1%) and ZENITHBANK (-7.1%) drove the weekly loss. Based on the preceding, the MTD and YTD return printed -0.3% and +9.7%, respectively.
Trading in the top three equities namely Fidelity Bank Plc, Transnational Corporation Of Nigeria Plc, and Access Holdings Plc (measured by volume) accounted for 426.566 million shares worth N1.777 billion in 3,307 deals, contributing 33.10% and 13.12% to the total equity turnover volume and value respectively.
Activity levels were mixed, as trading volumes increased by 9.6% w/w while trading value declined by 18.4% w/w. Performance across sectors was largely bearish, following losses in the Banking (-7.1%), Oil and Gas (-3.4%), Consumer Goods (-1.8%), Insurance (-0.3%), and Industrial Goods (-0.1%) indices.
We expect the weak sentiments that dominated the local bourse this week to persist in the week ahead, as investors continue to scale down exposure to equities following the mark down of share prices for 2021FY dividends amidst expectations of uptick in FI yields. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings.
This week, global stocks posted mixed performances as sentiments were shaped by concerns of an impending recession stemming from aggressive monetary policy tightening, moderation in energy prices, and anticipation of the outcome of the latest round of peace talks between Russia and Ukraine.
Accordingly, US (DJIA: -0.5%; S&P 500: -0.3%) stocks were set to end the week with marginal losses as investors assessed President Biden’s plan to release massive crude from US reserves to combat inflation.
European markets (STOXX Europe: +0.8%; and FTSE 100: +0.7%) were set for a weekly gain as hopes of a peace deal in the Ukraine crisis buoyed sentiments. Asian markets posted mixed performances, as the Japanese Nikkei 225: (-1.7%) closed lower taking a cue from the selloffs on Wallstreet.
Elsewhere, the SSE: (+2.2%) posted a weekly gain as progress in talks between Russia and Ukraine boosted appetite for risk assets. Emerging markets (MSCI EM: +1.5%) and Frontier (MSCI FM: +0.6%) market stocks closed higher consequent upon bullish sentiments in China (+2.2%) and Kuwait (+1.5%), respectively.
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