Stock market of the Nigerian Exchange Limited (NGX) sustained its positive momentum last week, gaining N1.13 trillion Week-on-Week (WoW).
As a result, the market capitalisation rose N1.13 trillion W-o-W to close at N34.326 trillion, while NGX All-Share Index gained 3.40 per cent W-o-W to close at 63,040.41 points.
The NGX benchmark index’s action was sustained in the bullish region for the seventh straight week to break the 62,000 strongholds to 63,040.87 points to trade above its 200-Day Simple Moving Average on the weekly chart in the face of ongoing market-focused and economic reforms.
To this, last week trading quarter kick-started on a positive track as most stocks hit new 52-week highs as well as major sectors recording positive performances on strong buying interests among low, medium and high cap stocks, especially banking, consumer goods, telecom and others that pushed the index up.
The performance across sectors has predominantly been bullish. The NGX Banking index exhibited an impressive weekly gain of 9.82 per cent. The NGX Oil & Gas index followed closely with a notable 7.18 per cent increase, while NGX Industrial Goods index also contributed positively to the overall market performance, closed the week with a 2.22 per cent gain.
Also, the NGX Insurance index experienced a gain of 0.73 per cent, while NGX Consumer Goods index emerged as the lone laggard, witnessing a slight decline of 0.22 per cent after paring back its gains from the previous week.
The market breadth for the week was positive as 78 equities appreciated in price, 25 equities depreciated in price, while 53 equities remained unchanged. Japaul Gold & Ventures led the gainers table by 58.57 per cent to close at N1.11, per share. Consolidated Hallmark Insurance followed with a gain of 57.32 per cent to close at N1.29, while Chams Holding Company went up by 56.76 per cent to close to N1.16, per share.
On the other side, Coronation Insurance led the decliners table by 26.51 per cent to close at 61 kobo, per share. Tripple Gee & Company followed with a loss of 26.40 per cent to close at N2.76, while Ikeja Hotel declined by 21.05 per cent to close at N3.15, per share.
Overall, a total turnover of 9.831 billion shares worth N145.408 billion in 54,478 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 3.369 billion shares valued at N41.986 billion that exchanged hands previous week in 39,764 deals.
Analysts at the Nigerian capital market expected a mixed trading pattern on the stock market this week but dominated by bulls as investors continue to select stocks with attractive dividend yields while keeping wary of abandoning gains in the market.
The index’s impressive gains, surpassing the 63,000 level, have not only propelled investor sentiment but also led to positive performances in major sectors such as Banking and Oil & Gas.
As the market enters the new reporting and earning seasons, investors and portfolio managers are expected to engage in sectoral portfolio rebalancing. The market’s overall resilience and growth potential make it an attractive investment destination, with opportunities for both short-term gains and long-term capital appreciation.
Analysts at Cowry Assets Management Limited stated “as a result of the above, we look forward to a mixed outing and erratic profit taking, since factors that pushed the market to this level remain unchanged so far. Meanwhile, we continue to advise investors on taking positions in stocks with sound fundamentals.”
In the new week, analysts at Cordros Securities Limited said “with the half-year earnings season on the horizon, we believe investors will look for clues on the sustainability of the decent corporate earnings released for Q1, 2023. However, we expect mixed market performance in the week ahead as bargain hunting in dividend-paying stocks will be matched by intermittent profit-taking activities.
“Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the unimpressive macro story remains a significant headwind for corporate earnings.”