Equities market opens election week on a positive note

Nigeria’s equities market opened the election week on a positive note amid analysts’ expectation that investors will be more selective in their bids.

Last week’s bearish momentum presented opportunities for the buy-side players at the Bourse to increase holdings on fundamentally sound stocks.

Conoil Plc led the advancers league after its share price increased from N35.25 to N38.75, adding N3.50 or 9.93percent. It was followed by Livingtrust Mortgage Bank Plc which increased from N2.30 to N2.52, adding 22kobo or 9.57percent. Other top gainers include Tripple G which rose from N1.99 to N2.18, adding 19kobo or 9.55percent and John Holt which moved up from N1.33 to N1.46, adding 13kobo or 9.77percent.

The market went up by 0.78percent or N228billion at the close of trading, pushing the year-to-date (YtD) return to 5.80percent. The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and its equities market capitalisation increased from preceding day’s 53,804.46 points and N29.310 trillion respectively to 54,224.35 points and N29.538trillion.

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In 3,095 deals, investors exchanged 154,628,198 shares valued at N5.505billion. GTCO, Zenith Bank, AIICO, Axa Mansard and Livingtrust Mortgage Bank were top-5 traded stocks on the NGX.

“Our long-time expectation for a trend reversal with the bears taking the centre stage has come to fruition. Going into the week, we expect an extended bearish momentum across board, with post-election worries stimulating the bear market.

“We recommend that Buy-Side investors and fund managers sit on the sideline, in a bid “wait and observe” the market. Equity stakeholders can look to book profits off stocks that have crossed the overbought region as indicated by the RSI.

“However, we believe that this brief bearish momentum would present further opportunities for the Buy-Side to increase holdings (in the near-term) on fundamentally sound stocks with improved valuation and dividend performance,” United Capital research analysts said in their Monday, February 20 note.

On what they expect to shape the market on Tuesday, Lagos-based Vetiva analysts who noted that Monday’s market activity was dominated by the small-cap names, also said as the elections approach, they expect investors to be more selective with their bids and anticipate a mixed session on Tuesday.