According to reports we got at the end of the week, the weekly gains came to a halt on the Nigerian stocks. The All Share Index posted its first loss in five days on Tuesday, after the shares of some high-profile banking, consumer goods, and oil & gas companies were sold off. The ASI declined further in Wednesday and Friday’s sessions, culminating into w/w loss of 0.77%. We attribute this week’s loss to profit-taking, given that there was no major change in the seemingly less-apprehensive macro environment which we have been highlighting in recent weeks. Adding to the positive atmosphere, a number of manufacturing companies (LAFARGE, UNILEVER, and CADBURY) released their full year 2016 results, and surprised investors with massive upturns (compared to Q3) in their Q4 performances. Also, the Naira reached record-high in the parallel market, the MPC (acting in line with consensus) pulled no negative surprise in the meeting held during the week, while the National Assembly approved the Executive’s request for a USD500 million Eurobond. Dragging the ASI down were the Banking (2.08%), Oil & Gas (3.18%) and Consumer Goods (0.31%) indices. Prominent names in these categories are GUINNESS (9.77%), SEPLAT (9.73), ETI (5.36%), and (ZENITHBANK (4.53%). Only the Industrial Goods index appreciated (5.14%) and was driven by price increases in the shares of LAFARGE (13.92%) and CCNN (4.44%).
Market breadth was negative, with 16 gainers (31 last week) — topped by LAFARGE (13.92% w/w) — versus 33 losers (20 last week) — led by GUINNESS (9.77% w/w). Total volume traded increased by 27.2% to 1.31 billion shares (1.03 billion last week), with CUSTODYINS, FBNH, and UBA accounting for 46.7% of the market volume. The value of trades also increased by 29.4% to 10.32 billion (previously N7.98 billion), with GUANRANTY, UBA, and NB accounting for 36.12% of total value.
The negative impacts of the economy is still telling on the Nigeria stock markets sending shares to the red, as the week trading end on a negative note. With the current state of the Nations economy activities of the capital market has been slow; since there is nothing that is driving the markets to profits. Investors has little or no confidence in the market and as such the decline we experience in the market. The capital market can strive in an active economy where investors and trader are sure of where they are putting their money.
The week ahead might not be upbeat for the market as well, except the companies that are set to release their earnings for the first quarters report a positive data. The current intervention by central bank on the money can be extended to capital, which can improve more trading activities and encourage investors to trade the market.
featured image is from google image.