Analysts see investors hunting bargains on price alignments

BY CHARLES ABUEDE

The local bourse extended its positive and impressive run for the second straight week with broad-based gains across sectors to give market investors N511.8 billion as they stay focused on players in the oil and gas space. The space contributed the most to the positive close recorded for the week gaining 636 basis points as investors bought up Oando plc and Eterna Plc.

In a similar take on the outlook, market analysts at Vetiva Capital and Afrinvest Capital Research, posit thus, “We anticipate a mixed session to start off the week amid slight profit-taking activities across the board. In the trading week, we expect the market to extend last week’s positive performance, driven by bargain purchases as investors continue to take advantage of pricing misalignments.”

Market activities last week saw the All-Share Index rise 1.9 percent week on week to settle at 48,459.65 points and for that reason, the market year to date returns improved to 13.4 percent from the previous 11.3 percent, while market capitalisation rose week on week to reach N26.13 trillion.

Throughout the week, the market activity level was mixed as the average volume rose 4.4 percent week on week to 325.4 million units while the average value traded fell 20.4 percent week on week to N4.5 billion.

The top traded stocks for the week by volume were Fidelity Bank with 119 million units, Zenith Bank with 87.4 million units and Universal Insurance, which traded 73.1 million units. On the other hand, MTN Nigeria with N6.1 billion, Zenith Bank with N2.1 billion, and Nigerian Breweries with N1.3 billion led the chart for the most traded securities by value for the week.

Across the sectors, performance was bullish except for the insurance index which fell 0.1 percent, week on week, due to price decline in AXA Mansard which went down 1.9 percent; and NEM Insurance, down 1.2 percent.

Leading the chart for the gainers in the week, the oil & gas index appreciated by 6.4 percent week on week, buoyed by impressive gains in Oando Plc which rose 21.3 percent and Eterna Plc which also rose 33 percent on the news of the takeover bid triggered by RainOil Limited.

Behind were the consumer goods and ICT indices, which rose 3.3 percent and 2.5 percent, week on week, respectively, following buy interest in Guinness Nigeria (+17.5%), Nigerian Breweries (+8.3%), and Airtel Africa by 4.7 per cent.

In the same vein, price uptick in Dangote Cement (+1.9%), Lafarge Africa (+10.6%), and Fidelity Bank (+5.2%) pushed the Industrial Goods and Banking indices higher by 1.7 percent and 0.6 percent week on week, respectively.

Meanwhile, investor sentiment, as measured by market breadth, steadied at 0.3x as 49 stocks gained, 28 stocks lost, and 75 stocks were unchanged. The top-performing stocks for the week were Meyer Pharmaceuticals (+45.6%), Eterna Plc (+33.0%), and Oando Plc (+21.3%), while Academy Press (-18.8%), John Holt (-17.4%), and Neimeth Pharmaceuticals (-13.9%) led the chart for the top underperforming stocks.

At the close of the week, the NGX 30 Index rose by 1.35 percent to close at 1,847.20 points as against 1,822.59 points recorded for the previous week’s close. Market turnover closed with a traded volume of 168.87 million units. Lafarge Africa and International Breweries were the key gainers, while Sterling Bank and Ecobank were the only losers.