Buy interest in bellwethers drives market rebound as NSEASI jumps 2.4%

Nigerian stocks appreciated Wednesday following renewed interest in market bellwethers, driving the benchmark index, the NSEASI, up by 2.4 percent to settle at 43,330.54 points. This just as market year-to-date gain improved to 13.3 percent.

Specifically, buy interest in DANGCEM (+5.0%), NIGERIAN BREWERIES (+4.5%) and NESTLE (+3.0%) buoyed performance with market capitalization increasing by N370.0 billion to N15.5 trillion.

Similarly, activity level increased as volume and value traded inched 30.3 percent and 22.7 percent higher to 438.6 million units and N10.8 billion respectively.

FCMB (192.9m), ACCESS (49.6m) and FBNH (48.1m) were the most traded stocks by volume while NESTLE (N2.3bn), DANGCEM (N2.0bn), GUARANTY (N1.2bn) led the most traded stocks by value.

The industrial goods index led the gainer’s chart, up 4.1 percent primarily on the back of a rally in DANGCEM (+5.0%) and WAPCO (+3.8%). The consumer goods index followed, rising 2.4 percent as NIGERIAN BREWERIES (+4.5%) and NESTLE (+3.0%) recorded gains.

The banking and oil & gas indices also trended northwards, up 0.8 percent and 0.2 percent respectively, due to price appreciation in ZENITH (+1.8%), UBA (+1.6%), SEPLAT (+0.4%) and FORTE (+0.2%). Bargain hunting in NEM (+5.0%) and CONTINSURE (+1.9%) uplifted the insurance index by 0.1 percent.

In related news, SEPLAT released its 2017 earnings result on the day, which was largely impressive. The company’s gross revenue spiked 118.2 percent to N138.3 billion, driven largely by higher production levels occasioned by the relative peace in the Niger Delta region in 2017.

Accordingly, the company recorded N81.1 billion in profit after tax (PAT) from a loss of N45.4 billion in 2016.

Market breadth (advance/decline ratio), which measures investor sentiment strengthened on the day, improving to 1.4x from 0.5x recorded the previously as 31 stocks advanced while 23 stocks declined.

The best performing stocks were CCNN (+8.5%), JAPAUL OIL (+8.0%) and NEM (+5.0%) while COURTVILLE (-6.9%), AFRINSURE (-5.0%) and REDSTAREX (-4.8%) declined the most.

Analysts see market performance remaining largely positive in the short term on

Current trading pattern, which is reflective of the fact that investors are increasingly taking a position in fundamentally sound dividend-paying stocks as earnings begin to trickle in.

In the NASD OTC Exchange, total volume and value traded stood at 45.5 million units and N35.1 million respectively. SDCSCSPLC (+0.9%) was the only instrument that gained on the day