Upward trend as equity market commences the week

The domestic equity market commenced the week on an optimistic note as the All Share Index [ASI] added 22bps following a major rally in the banking and oil and gas stocks amidst positive investor sentiments.

In contrast, analysts noted that yesterday’s upsurge was stunted by the 47bps decline in the consumer goods index following losses by heavyweights such as Nigerian Breweries and Flourmills.

The day’s performance brings the ASI year-to-date return to -12.77 per cent. The day’s performance was predominantly driven by Forte Oil (3.93 per cent, ₦264.99), Zenith Bank (3.07 per cent, ₦16.80), GTBank (1.41 per cent, ₦23.66), and Mobil (3.40 per cent, ₦150)

Analysis of the market activity in the week last week technically revealed growing pessimistic trading as speculators maintained active profiteering posture.

Also, an extensive analysis revealed a surge in distribution level supply activities gathered momentum during the wee. The active distribution was observed in active sectors, particularly in financial services, oil and gas and conglomerates sectors.

In addition, investors displayed fresh and waning sell tendency in some active sectors, particularly in consumer goods, oil and gas and construction/real estate.

However, analysts observed fresh moderate bargain tendency in industrial goods, healthcare and agriculture sectors.

Summarily, the bears ruled the week, depressing the key benchmark index by 423.19 points against 45.24 gain recorded in the previous week to close at 30,165.22- ASI remains depressed and battered below its key resistance level at 41,957.50
Also, the All Share Index traded within the range of 30,405.88 (week-high) and 30,123.20 (week-low) to settle at 30,165.22, below previous week’s low (30,588.41) by 45.24 points, which indicated growing pessimistic level when compared with previous posture. The outlook reveals falling bargain tendency.

Likely trends in the coming periods: Stocks with cheap valuations would continue to attract low patronage while analysts foresee growing price volatility as short-sellers are likely to remain active in the coming week.