Stock market: Investors lose N1.8trn Year-to-Date

Analysts forecast rebound this week THE Nigerian stock market closed last week on a negative note making it four days of straight losses since the beginning of the month, with investors losing N1.8 trillion of their investment Year to Date, YtD.

Consequently, the YtD loss of the Nigerian Stock Exchange, NSE All Share Index increased to 15.32 percent to close at 32, 383.15 points while investors lose about N1.8 trillion worth of their investment, represented by market capitalisation, which close at N11.822 trillion from N13.609 at the end of trading in December 2017.

Notwithstanding the negative close of the market, analysts have forecast that this week the stock market will record an upbeat given the expected release of positive corporate earnings for the third quarter, Q3’18.

Analysts at Cowry Asset Management said: “This week, we expect the NSE ASI to close in green territory, given the earning season. We also feel domestic retail and institutional investors would take advantage of the undervalued stock prices to acquire more shares as the potential for higher dividend yields increases. More so, we maintain that investors should hunt for companies that have recorded increased earnings as at H1 2018 with tendencies to sustain the performance.”

In their reaction on the performance of the market, analysts Vetiva Capital Management said: “With market activity moderating WoW and investor sentiment remaining tepid, we anticipate a negative start to next week, as the quarter maintains a bearish course. On the stock watch; after gaining 10 percent last week, Forte Oil closed at ¦ 22.10 on Friday, its highest price since August. Having lost 49 percent YtD, the stock is trading below its consensus target price of ¦ 41.69 and is underperforming the Oil and Gas sector (-12% YtD).”

Commenting as well, a Lagos based investment firm, Cordros Capital, said : “Our outlook for equities in the near-to-medium term is negative, and we guide investors to trade cautiously, amidst absence of a near term positive catalyst and political jitters ahead of the upcoming 2019 elections. However, macroeconomic fundamentals remain stable and supportive of recovery in the long term.”

A cursory review of the market shows that stock market plunged Week-on-Week (WoW) by 1.17 percent as investors ‘sentiment on blue chip companies was weak.

Meanwhile, a total turnover of 639.317 million shares worth N7.842 billion in 10,477 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 924.546 million shares valued at N14.194 billion that exchanged hands penultimate week in 14,119 deals.

The Financial Services Industry (measured by volume) led the activity chart with 517.865 million shares valued at N4.654 billion traded in 5,977 deals; thus contributing 81.00 percent and 59.35 percent to the total equity turnover volume and value respectively.

The Consumer Goods Industry followed with 54.733 million shares worth N2.526 billion in 1,703 deals. The third place was Conglomerates Industry with a turnover of 14.752 million shares worth N25.560 million in 452 deals.

Trading in the Top Three Equities namely – First City Monument Bank, Fidelity Bank Plc and Guaranty Trust Bank Plc, (measured by volume) accounted for 267.466 million shares worth N2.592 billion in 1,733 deals, contributing 42.00 percent and 33.05 percent to the total equity turnover volume and value respectively.