Business
THE bearish sentiment on the Nigerian Exchange, NGX, continued last week in the midst of profit taking, which dragged down the Year to Date, YtD growth of the stock market to 28.4% from 29.9% the previous week.
Profit taking across the sectors pulled back the benchmark NGX All-Share Index, ASI to close lower at 95,973.45 points from 97,100.31 points, thereby extending the bear transition for two successive weeks.
Consequently, Month-to-Date, MtD returns settled at -1.8%.
Similarly, the market capitalisation dropped by over N2 billion to close at N55.129 trillion from N55.131 trillion the previous week.
Analysts noted that the mixed momentum and sentiment reflects in the market’s dynamics of volatility that creates the needed opportunity to buy low and sell high, especially as most of the listed companies have become undervalued owing to the recent downtrend in their share prices, even as the pullbacks are driven by high cap stocks that are facing selloffs due to sector rotations and portfolio rebalancing. Corporate numbers reveal the position of many companies on the Exchange, despite the ongoing economic headwinds as revealed by economic data.
Analysis of the market showed that across sectors’ coverage, the Oil and Gas Index up 3.5%, Banking Index 0.4% and Insurance Index 1.9% while the Industrial Goods Index declined by 4.9% and Consumer Goods Index 1.4%. Analysts have observed that the economic reforms of the government, measured by the outpouring of fiscal and monetary policies are yet to put the nation’s economy on the path of recovery, due to the continued mismatch of these and previous ones. There are also issues with the implementation style amid the oscillating oil production output even as the Naira continues to depreciate at a time that oil is rebounding to sell below $80 per barrel at the international market.
Last week, Regency Alliance Insurance notified the Exchange of its board meeting, while Oando informed the market of its completion of the $783m acquisition of ENI’S subsidiary Nigerian Agip oil company. Airtel Africa continues to update the Exchange of its ongoing share buyback programme, just as Jaiz Bank notified the market of appointment non-executive director, while, MTNN, Cutix and Ucap informed the Exchange of insider dealings in its shares.
On the market outlook, investors at InvestData Consulting said: “We expect mixed sentiment to continue on bargain hunting, profit taking and sector rotation amidst oversold region. Portfolios repositioning is however continuing, as investors take advantage of pullbacks to buy into value.
vanguard
A.I
Aug. 26, 2024
Tags: NGX Nigerian Exchange
