'How investors profit-taking of N463bn halt equities market bullish streak'

The equities market of the Nigerian Stok Exchange (NSE) halts its bullish streak to end last week trading activities on a downward trend, as the investors’ profit-taking in Lafarge Africa Plc, Dangote Cement Plc and Zenith Bank Plc dropped by N463billion week on week (w/w).

For instance, the market capitalization of listed opened for trading at N18.365trillion and closed at N17.902 trillion, while the All-Share Index ended the week 2.5per cent lower at 34,250.74 basis points from 35,137.99 basis points it opened for trading.

The equities market recorded a weekly loss on continued profit-taking and as the market reacted negatively to the uptick in short-term yields at the NTB primary auction.

Selloffs of Dangote Cement dropped by eight per cent as Lafarge Africa was down by 10.7per cent. Zenith Bank and MTN Nigeria dropped by 5.2 per cent and 0.8 per cent respectively.

This contributed to the decline last week with the Month-Till-Date (MtD) and Year-Till-Date (YtD) return of the index settling at -2.3per cent and 27.6 per cent respectively.

The performances across sectors were negative, with the Industrial Goods (-5.0 per cent), Banking (-2.9 per cent), Insurance (-1.8 per cent), Consumer Goods (-1.6 per cent) and Oil and Gas (-0.3 per cent) indices recording losses.

The NSE weekly report stated, “A total turnover of 2.265 billion shares worth N20.990 billion in 23,722 deals were traded this week by investors on the floor of the Exchange, in contrast to a total of 1.675 billion shares valued at N25.425 billion that exchanged hands last week in 23,650 deals.

“The Financial Services industry (measured by volume) led the activity chart with 1.884 billion shares valued at N14.933 billion traded in 13,602 deals; thus contributing 83.15 per cent and 71.14 per cent to the total equity turnover volume and value respectively.

“The Consumer Goods Industry followed with 116.400 million shares worth N2.817 billion in 3,474 deals. The third place was conglomerates Industry, with a turnover of 107.803 million shares worth N231.323 million in 897 deals.

“Trading in the top three equities namely Jaiz Bank Plc, United Bank for Africa Plc and Zenith Bank Plc (measured by volume) accounted for 894.000 million shares worth N7.077 billion in 4,045 deals, contributing 39.47 per cent and 33.72 per cent to the total equity turnover volume and value respectively.”

The report stated that a total of 13,555 units valued at N17.369 million were traded this week in eight deals compared with a total of 3,198 units valued at N3.898 million transacted last week in 10 deals.

“A total of 292,510 units valued at N2.270 billion were traded this week in 45 deals compared with a total of 543,655 units valued at N4.694 billion transacted last week in 36 deals,” the report added.

Cordros Research stated that, “We expect the profit-taking and negative reaction to the unanticipated front-end supply from the CBN to be short-lived.

“Yields in the fixed income market remains relatively unattractive, and we expect this to remain positive for stocks.

“However, we advise investors to take positions in only fundamentally justified stocks as the weak macro environment remains a significant headwind for corporate earnings.”