Investors’ appetite for high-cap stocks lifts market indices by N641b
• As outcome of U.S. presidential election excite participants
Following investors’ continued interest in some high capital (high cap) stocks, especially Dangote Cement and MTN Nigeria Communications (MTNN), transactions on the equities sector of the Nigerian Stock Exchange (NSE) closed upbeat, with market capitalisation gaining N641 billion.
The Nigerian equities market yesterday took off on a bullish note to commence trading for this week with a gain of 3.96 per cent. The All Share Index (ASI) increased by 1,226.88 absolute points, representing a growth of 3.96 per cent to close at 32,243.05 points.
Similarly, investors appreciated N641 billion as market capitalisation closed at N16.848 trillion.
The upturn was impacted by gains recorded in medium and large value stocks including Dangote Cement, MTN Nigeria Communications (MTNN), Lafarge Africa, BUA Cement and Guaranty Trust Bank.
The Chief Research Officer, Investdata Consulting Limited, Ambrose Omordion, attributed the rise in indices to inflow of funds from maturity in open market operations (OMO) bills and other investment windows totalling N224 billion that entered into the equity space to mop up shares of blue-chip and stocks with a history of dividend payout.
He also noted that the outcome of the U.S. presidential election, which has also impacted positively on the stock market globally, is also an encouragement to local investors.
“The better-than-expected corporate earnings have equally fuelled the positive sentiment as investors reposition their portfolio for year end and 2021. The market has suffered two years of decline before this recent rebound.
“Investors should allow their investment objective to guide them and know when to take profit as the outcome of the U.S. presidential election boosts confidence that impacts positively on the stock market globally.”
Analysts at United Capital said: “While we imagine the possibility of some profit-taking early in the week, we also see the outcome of the U.S. election exciting market participants. Thus, we maintain that the market will continue its bullish streak this week.”
Vetiva Dealing & Brokerage said: “The domestic bourse again benefited from bargain-hunting activities in mid/large cap stocks as investors’ cherry picked attractive counters across sectors.
“We expect no deviation from this trading pattern tomorrow, given the strong positive market breadth coupled with the significant bullish sectoral performances. However, with the gains recorded in the last few sessions, the possibility of profit-taking cannot be overruled.”
Sentiment, as measured by the market breadth, was positive as 49 stocks gained, relative to 11 losers.
Lafarge Africa, Mutual Benefits Assurance, Northern Nigeria Flour Mills, and Oando Plc recorded the highest price gain of 10 per cent each, to close at N21.45, 22 kobo, N6.05, and N2.97, respectively, per share.
Sterling Bank followed with 9.89 per cent to close at N2.00, while Cutix rose 9.83 per cent to close at N1.90, per share.
On the other hand, NCR Nigeria led the losers’ chart by 10 per cent to close at N1.80 per share. Learn Africa followed with 8.70 per cent to close at N1.05, while Conoil shed 6.30 per cent to close at N17.85, per share.
Wapic Insurance lost 4.55 per cent to close at 42 kobo, and PZ Cussons Nigeria slipped 3.13 per cent to close at N4.65, per share.
The total volume traded fell marginally by 0.23 per cent to 636.010 million shares, worth N8.244 billion, traded in 7,210 deals.
Transactions in the shares of Zenith Bank topped the activity chart with 70.223 million shares valued at N1.664 billion.
FBN Holdings followed with 67.652 million shares worth N474.567 million, and Access Bank traded 58.020 million shares at N500.230 million.
United Bank for Africa (UBA) traded 48.533 million shares valued at N410.400 million, while Fidelity Bank transacted 35.191 million shares worth N97.472 million.