The equities market witnessed a resurgence in gains last week after the release of the encouraging half-year, H1’24, financial results by Zenith Bank Plc and GTBank Plc. These results notably bolstered the performance of the Banking Index, reflecting a positive trend in the market.
In response to the gains in key stocks like MTN, First Bank of Nigeria Holding, Oando, and Nestle, among others, bargain hunting ensued, lifting the market. The Nigerian Exchange, NGX, All Share Index, ASI, surged by 1.1% to settle at 97,456.62 points from the previous week’s close of 96,433.53 points.
Likewise, the market capitalization saw a significant increase of over N607 billion, closing at N56.001 trillion compared to N55.394 trillion the previous week. The Month-to-Date (MtD) return stood at -0.3%, while the Year-to-Date (YtD) return was at a positive 30.3%.Trading activity displayed a mixed pattern, with a notable increase in volume by 20.2% Week on Week (W/W) while the value experienced a slight dip of 0.5%. Sectoral performance was positive across the board, with gains in the Banking, Oil and Gas, Insurance, Consumer Goods, and Industrial Goods indices.In terms of market outlook, analysts at Cordros Research projected mixed sentiments in the near term, with a focus on bank stocks due to recent corporate actions.
They also noted the likelihood of profit-taking activities on stocks that have seen significant appreciation in recent weeks. In light of the volatility and pullbacks that are enhancing the upside potential, it is advisable for investors to capitalize on price corrections. It is also essential to closely monitor trends and developments both globally and domestically to make informed investment decisions.
Looking ahead, in the medium term, investor sentiments are likely to be influenced by macroeconomic developments and yield movements in the fixed-income market. Regarding the market outlook, analysts at InvestData Consulting Limited expressed, “We anticipate a mix of sentiments driven by profit-taking and bargain hunting, especially with expectations surrounding the release of half-year financial results from other dividend-paying stocks. Sector rotation remains a key factor in the market, with ongoing portfolio repositioning as investors seize opportunities presented by market pullbacks to invest in value.”
