Trading at the Nigerian Stock market gained 33bps to settle at 32,154.03 points due to bargain hunting in bellwethers NIGERIAN BREWERIES (+1.3%), NESTLE (+3.6%), and UBA (+4.0%). But low prices of equities in the financial services sector and improved third quarter results by some banks fuelled a robust performance of the stock market in October. Data available at the exchange showed that banking equities dominated the gainers’ table with Fidelity Bank emerging the best performing stock in percentage terms last month. Specifically, Fidelity Bank during the period rose by 20 per cent to close at N2.04 per share against the opening price of N1.70. Diamond Bank trailed with a growth of 19.49 per cent to close at N1.41, while Newrest ASL improved by 17.86 per cent to close at N6.60 per share. Other top gainers’ are Cadbury, Forte Oil, Zenith Bank , Total , Mutual Benefits, Sterling Bank and UPL.
Meanwhile as a result of the positive trend market capitalisation increased by N38.6 billion to N11.7 trillion while YTD loss moderated to -15.9 per cent. Activity level was however mixed as volume traded fell 5.0 per cent to 149.7 million units while value traded appreciated 59.6 per cent to N2.8 billion. The top traded stocks by volume were FIDELITYBK (22.0m), REGALINS (19.4m) and GUARANTY (N11.8m) while the top traded stocks by value were NESTLE (N723.8m), GUARANTY (N447.1m) and SEPLAT (N344.3m). Performance across sectors was largely bearish as 3 of 5 indices under our coverage closed in the red. The Insurance index depreciated the most, down 1.1 per cent, following sell-offs in in NEM (-4.4%) and MBENEFIT (-10.0%). Similarly, the Banking and the Oil & Gas indices trailed, as they shed 0.5 per cent and 0.1 per cent respectively, due to sell pressures in GUARANTY (-1.8%), ACCESS (-1.3%), ETI (-0.3%) and OANDO (-1.0%). On the flip side, the Consumer Goods and Industrial indices appreciated, up 1.8% and 0.4% respectively due to gains in NESTLE (+3.6%), NIGERIAN BREWERIES (+1.3%) and CCNN (+9.8%).
Investor sentiment as measured by market breadth (advance/decline ratio) weakened to 0.6x from 0.7x as 14 stocks appreciated against 23 decliners. CCNN (+9.8%), NAHCO (+5.3%) and DANGSUGAR (+4.3%) were the best performing stocks while the worst performing stocks were MBENEFIT (-10.0%), FIDSON (-10.0%) and UAC-PROP (-10.0%). Today, we observed buying interests in some under-priced stocks and we expect this trend to continue tomorrow. However, despite the rally in today’s trading session, we maintain our bearish outlook over the near term.
In October Cutix emerged as worst performing stock in percentage terms with a loss of 50.49 per cent to close at N2.03 per share against the opening price of N4.10. The loss by Cutix was due to price adjustment for bonus share of one ordinary share for every one held and 20k dividend. Mcnichols came second with 43.06 per cent to close at 41k, while Niger Insurance dipped 29.73 per cent to close at 26k per share. Other top losers are Honeywell, Lafarge Africa, GSK, Union Diagnostic, Beta Glass, Fidson and Meyer. Consequently, the All-Share Index during the period shed 300.10 points or 0.92 per cent to close at 32,466.27 compared with 32,766.37 achieved in September. Similarly, the market capitalisation which opened at N11.962 trillion lost N110 billion or 0.92 per cent to close at N11.852 trillion. Prof. Uche Uwaleke, Head of Banking and Finance Department, Nasarawa State University Keffi, said the performance of the market in October remained weak in spite of the positive financial results released by some listed companies. Uwaleke attributed the trend to the exit of foreign investors occasioned by the higher yield environment (on a risk adjusted basis) in developed countries especially the United States and the heightening political uncertainty in Nigeria.
He said the performance of the capital market in the near term would not be any different, noting that domestic investors were not insulated from the political risk. Mr Ambrose Omordion, the Chief Operating Officer, InvestData Ltd. , attributed the development to mixed sentiments and liquidity problem. Omordion said cautious trading among investors as the 2019 general elections drew closer in the midst of dwindling economic activities and weak economic data contributed to the negative trend in the market.
