The Nigerian stock market took off this week on a slightly negative note (0.02percent) as investors remained on the sell side of the Bourse on Monday, September 6.
Some analysts had advised investors to cautiously approach the equities market noting that sell pressure seen last week will continue; though they didn’t rule out the possibility of bargain hunting in favour banking counters.
The new dip no doubt offers re-entry opportunities for investors into value stocks seen trading at new lows.
The NGX All-Share Index and Market Capitalisation decreased from preceding trading day’s highs of 39,261.01points and N20.456trillion respectively to 39,252.98 points and N20.451trillion.
Investors lost N5billion at the close of trading session. Major laggards include stocks like GSK which decreased most from N6.80 to N6.15, down by 65kobo or 9.56percent, and May & Baker which dipped from N4.80 to N4.48, losing 32kobo or 6.67percent.
In 3,989 deals, investors exchanged 210,954,305 units valued at N1.383billion. Access Bank, Mutual Benefit, Sovereign Trust Insurance, Universal Insurance and Honeywell Flour Mills were most traded stocks on the Bourse.
Read also: See what analysts say about equities this week
On the positive, this week investors should not rule out the possibility of recouping some losses occasioned by likely buy sentiment on some tickers in the banking sector especially as investors move to position for interim dividends.
Nigeria’s stock market had closed last week with negative return year-to-date (YtD) at -2.53percent; it increased to -2.54percent at the close of trading on Monday.
For investors who are yet to take decisions on equities this week, some research analysts’ views could serve as a guide to trading on now bumpy Custom Street, Lagos.
“Although some profit-taking activities occurred in the market the previous week, we think significant tail room still exists on some heavyweight stocks.
“We expect bearish sentiment to persist across the equities market this week”, said Lagos-based Meristem analysts in their September 6 note to investors.
However, Meristem did not rule out the possibility of buying pressure on some tickers in the banking sector which currently have significant upside potential, in addition to the prospect for interim dividends.
“We expect market to remain quiet as investors continue to stay on the sidelines awaiting the remaining of the Tier-1 half-year results.
“However, we do not rule out pockets of gains in names that have declined in recent sessions but overall, we expect investors to continue to stay cautious”, said Vetiva research analysts.
United Capital research analysts expect the market to drift sideways this week “barring any major trigger.”
“We anticipate some investor bias for banking stocks as market participants position for interim dividends”, the United Capital analysts added in their recent investment views.
