Nigerian equities market index gains 0.33% as global stock rise on strong earnings, economic data

The Nigerian equities market Tuesday reversed the negative trend, which began last week, as benchmark index rose 0.33 percent to close at 36,531.62 points. This is just global stock markets rise on strong earnings, economic data.

Accordingly, market capitalization increased N41.2 billion to settle at N12.6 trillion. The positive performance was broadly driven by gains in NIGERIAN BREWERIES (+2.6%), ZENITH (+0.8%) and DANGSUGAR (+2.8%).

However, market activity weakened as volume and value traded moderated 21.2 percent and 32.9 percent to 199.9 million units and N1.8 billion respectively.

Performance across sectors was mixed, with two of five indices trending northwards, two closing in the red and one closing flat. The consumer goods index led gainers, up 1.2 percent following price appreciation in NIGERIAN BREWERIES (+2.6%) and DANGSUGA (+2.8%).

Similarly, the banking index followed closely, gaining six basis points due to upticks in ZENITH (+0.8%) and ACCESS (+1.3%). Contrarily, the insurance index closed 60 basis points lower consequent on sustained sell offs in MANSARD (-2.8%) and LAWUNION (-4.0%), while losses in DANGCEM (-0.5%) pulled the Industrial Goods index 20bps southwards. The Oil & Gas index closed flat.

Investor sentiment as measured by market breadth (advancers/decliners ratio) expanded to 1.5x from 0.6x yesterday – 22 stocks advanced while 14 declined. NASCON (+10.2%), CAVERTON (+4.2%) and FIRSTALUM (+4.0%) led the gainers’ chart while CILEASING (-5.0%), TRANSCORP (-4.9%) and CADBURY (-4.8%) were Tuesday’s worst performers.

Analysts say with the positive turn of the market today, they expect sentiment in successive trading sessions to reflect investors’ reactions to the release of 9M:2017 results.

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In the NASD OTC exchange, three counters traded – CSCS, WAMCO and NIPCO – with total volume and value closing at 3.8m units and N27.3m respectively. CSCS was the lone gainer, up 9.3% while the others closed flat.

Relatedly, global stock markets rose Tuesday on upbeat corporate earnings and economic data globally. Tokyo’s benchmark Nikkei 225 extended a post-World War II record by logging its 16th straight trading session of gains.

Germany’s DAX rose 0.3 percent to 13,044 and France’s CAC-40 gained 0.4 percent to 5,409. The FTSE 100 in London gained 0.1 percent to 7,531. On Wall Street, the future for the Dow Jones industrial average rose 0.6 percent while the Standard & Poor’s 500 futures were up 0.2 percent.

A survey in the eurozone showed its economy continued to grow at a fast pace in October and that companies were hiring at their fastest pace in a decade. The manufacturing sector in particular saw good growth in France and Germany. In Japan, a survey of manufacturers showed activity weakened but still grew relatively strongly and exports rising.

Corporate reports were positive from McDonald’s as well as from automakers General Motors and Fiat Chrysler. McDonald’s made third-quarter earnings of $1.88 billion, which beat expectations. Though GM posted a huge paper loss last quarter, that was due to charges from the sale of its European unit. Without that, it made an above-expectation $2.5 billion before taxes. Fiat Chrysler saw net profit rise 50 percent and maintained its outlook.

Tokyo’s Nikkei 225 index climbed 0.5 percent to 21,805.17 and the Shanghai Composite Index gained 0.2 percent to 3,388.25. Hong Kong’s Hang Seng lost 0.5 percent to 28,154.97 while Sydney’s S&P-ASX 200 was little-changed at 5,897.60. Seoul’s Kospi was unchanged at 2,490.49 and India’s Sensex advanced 0.3 percent to 32,594.62. Benchmarks in Taiwan, Bangkok and Jakarta rose while New Zealand and Singapore retreated.

On energy front, benchmark U.S. crude gained 25 cents to $52.15 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 6 cents on Monday. Brent crude, used to price international oils, gained 18 cents to $57.55 in London. It fell 38 cents the previous session.

For currencies, the dollar rose to 113.90 yen from Monday’s 113.43 yen. The euro gained to $1.1760 from $1.1749.

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