Goodbye 2020: Banking, industrial, ICT indices gift investors N777.6bn

By Charles Abuede

As the economic climate in the country is clearly geared towards driving the economy out of recession in the first quarter of 2021, market players are taking positions in expectations that monetary and fiscal policies will be directed towards stimulating demand and internal productivity across all sectors and industries in the economy.

Nevertheless, with market participants living with expectations of a continued bullish trend in the New Year, investors are expected to review their positions in line with investment goals, as well as the environment, and observe another trading day for trend formation as optimism gushes high in for the year’s trading.

However, investors are looking poised for more profitable deals in 2021 from equities with good fundamentals and intrinsic values.

The market closed the year with a strong bullish sentiment, which was dominant through the last quarter of 2020 as investors continue to take positions on the sound counters in the market, during the last trading days of the year.

The local bourse ended the year in the green territory as the All-Share index rose 3.8 per cent week on week to 40,270.72 points on the back of gains in BUA Cement (+28.9%), MTN (+6.2%) and Zenith Bank (+1.2%).

Consequently, investors gained N777.6 billion as market capitalisation advanced to N21.06 trillion from N20.66 trillion from the previous close as the market year to date return rose to 50 per cent.

Conversely, market activity level declined as average volume and value traded fell 12.6 per cent and 14.1 per cent to 602.1 million units and N8.7 billion respectively. The most traded stocks by volume were AIICO Insurance (689.2 million units), Access Bank (263.9 million units) and UBA (153.1 million units), while Dangote Cement (N13.2 billion), MTN (N8.3 billion) and Zenith Bank (N3.6 billion) led the value chart.

Performance remained bullish across sectors as 4 of 6 indicators closed in the green, save the banking and consumer goods indices, which lost 0.6 per cent and 0.5 per cent week on week, respectively due to losses in Eco Bank (-8.4%) and Flour Mills (-7.0%).

Meanwhile, the industrial goods and AFR-ICT indices recorded the most gains, up 10.4 per cent and 2.4 per cent week on week, respectively, supported by buying interest in BUA Cement (+28.9%) and MTN (+6.2%). Similarly, the insurance and oil & gas indices closed 1.7 per cent and 0.2 per cent higher week on week, respectively, underpinned by gains in NEM Insurance (+31.6%), Linkage Assurance (+6.1%) and Oando Plc (+1.6%).

Investor sentiment as measured by market breadth (advance/decline ratio) waned to 0.9x from 3.8x last week as 29 tickers gained against 33 losers. NEM Insurance Plc (+31.6%), BUA Cement (+28.9%) and C & I Leasing (+20.6%) led the top gainers while AXA Mansard (-75.0%), FTN Cocoa (-25.8%) and AIICO Insurance (-10.3%) led the decliners.

The NSE 30 Index increased by 2.27 per cent to close at 1,640.11 points, as against 1,603.71 points on the previous day. Market turnover closed with a traded volume of 325.56 million units. FCMB and BUA Cement were the key gainers, while International Breweries and Ecobank were the key losers.