Financial stocks dominate, lift NGX turnover by 55%
The financial services industry dominated in volume terms at the end of last week’s transactions on the equities sector of Nigeria’s capital market.
The industry-led the activity chart with 793.120 million shares valued at N8.1 billion traded in 10,947 deals, thus contributing 54.77 per cent to the total equity turnover.
Following the financial sector last week was the ICT industry with 215,543 million shares worth N3.7 billion in 1,468 deals.
The conglomerate industry ranked third with a turnover of 98.299 million shares worth N190.2 million in 889 deals.
Trading in the top three equities namely Guaranty Trust Holding Company Plc, Courteville Business Solutions Plc and Chams Plc accounted for 308.076 million shares worth N2.9 billion in 2,225 deals, contributing 21.27 per cent to the total equities turnover.
Consequently, a total turnover of 1.448 billion shares worth N19.08 trillion was recorded in 22,557 deals by investors on the floor of the exchange.
This volume of shares traded was, however lower than a total of 1.858 billion units, valued at N47.486 billion that changed hands in 20,861 deals on January 21, 2022.
On the price movement chart, the bulls continued to dictate proceedings, as the gradual release of corporate earnings bolstered buying interests in dividend-paying stocks. Accordingly, the All-Share Index (ASI) and market capitalization appreciated by 0.5 per cent to close the week at 46,205.05 and N24.898 trillion.
However, all other indices finished lower except NGX Mainboard, NGX banking, NGX AFR Bank Value, NGX AFR Div Yield, NGX Meri Growth, NGX Consumer Goods and NGX Oil/Gas indices, which appreciated by 3.87 per cent, 4.84 per cent, 0.35 per cent, 1.65 per cent, 1.17 per cent, 2.04 per cent and 3.53 per cent while the NGX ASem, and NGX Growth indices closed flat.
Notably, bargain hunting in Ecobank Transnational Incorporated (ETI) (+44.8 per cent), Guinness (+14.0 per cent), International Brewery (+18 per cent), Airtel Africa (+10 per cent) and Total Energies (+8.6 per cent) spurred the weekly gains.
Reacting to market performance last week, the Chief Research Officer of Investdata Consulting Limited, Ambrose Omordion said investors were targeting dividend-paying stocks as they reposition their portfolios ahead of 2021 Q4 and full-year audited earnings reports.
In addition, he explained that the relatively low volume traded stocks amid uptrend and recovery moves are creating new buy opportunities for investors.
According to him, these stocks trading within their buy ranges, are expected to attract more funds into the stock market, given the dividend yield capable of serving as a hedge against inflation.
Cordros Capital said: “With the outcome of the MPC meeting aligning with market expectations amid negative real returns in the fixed income market, we expect investors to continue to cherry-pick stocks with attractive dividend yields.
“However, we advise investors to take positions in only fundamentally justified stocks as the fragility of the macroeconomic environment remains a significant headwind for corporate earnings.”
Vetiva Dealings and Brokerage firm said: “The market closed the week positive as investors began to take position ahead of earnings reports while increased demand was also seen in companies that have released better than expected results.
“We expect a similar trading pattern to filter into the new week as investors continue to trade in line with earnings reports.”
Further breakdown of last week’s transactions showed that a total of 7,900 units of exchange-traded products (ETPs) valued at N1.8 million were traded last week in 38 deals compared with a total of 28,084 units valued at N18.300 million transacted in 27 during the preceding week.
Similarly, 57,971 units of bonds, valued at N59.2 million were traded in 15 deals compared to a total of 2,290 units worth N2.291 million exchanged on seven deals.
44 equities appreciated during the week, lower than 47 equities in the previous week. 33 equities depreciated, higher than 23 equities in the previous week, while Seventy-nine 79 equities remained unchanged lower than 86 equities recorded in the previous week.