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First half results to determine stock market direction

First half results to determine stock market direction

While stock trading on the first day of this second ha l f (H2) of 2019 began on a lackluster note, the direction of the market going further into H2 period will be largely determined by the half- year ( H1) result of companies expected to be released on the Nigerian Stock Exchange (NSE) in coming weeks.

The stock market took-off into the second- half ( H2) of 2019 on a negative note as investors maintained their bearish stance on equities.

Stock trading in the just ended month of June left negative footage after recording an approximated loss of about N480billion.

“Half year results of listed companies will largely determine market direction early in the new quarter, while policy direction as determined by economic managers will play a major factor in the health of the general market,” Vetiva research analysts said in their July 1 equity market report.

They do not rule out the possibility of bargain hunters picking some of the counters due to attractive price levels.

FSDH research had in their monthly economy and financial market outlook for June expected

the following factors to drive performance of the equity market in the short- term: strategic positioning ahead of earnings season, crude oil price above $70 per barrel, and stability in the foreign exchange market.

The analysts asked investors to position in stocks that have good fundamentals, history of good dividend payment and are currently trading below their fair value.

“We see opportunities in the banking, consumer goods, building materials, and oil and gas sectors of the equity market”, the analysts added.

Meanwhile, pursuant to the post- listing requirements of Nigerian Stock Exchange (NSE) for quoted companies, many companies have commenced the closed period for trading in their shares in respect of the audited financial statements for the halfyear ended June 30.

The close period is the time period between the completion of a listed company’s financial results and the announcing of these results to the public.

It is intended to prevent trading in a company’s shares by its insiders ahead of the public dissemination of its financial results.

In addition to the announcement of their closed periods, the companies have officially disclosed dates for their scheduled board meetings.

The Board of Directors of Gtbank Plc is scheduled to meet on Wednesday July 24, to consider the audited financial statements for the half-year ended June 30.

Issues relating to half- year dividend may also be discussed at the meeting. Banks audited financial statements for the half year period are expected to be submitted to the Central Bank of Nigeria for approval, prior to the release of the results on the floor of the Nigerian Stock Exchange.

The Board of Transcorp Hotels Plc has scheduled its meeting to hold on July 15 to consider among other things the unaudited financial statement of the company for the period ended June 30, 2019.

Also, in the run up to the announcement of Seplat Petroleum Development Company Plc half year (H1) results, the company had on June 28, 2019 announced the commencement of a closed period from Monday July 1, 2019 to end 24 hours after the release of the financial results.

The Board of Directors of Transnational Corporation of Nigeria Plc has scheduled its 76th Board meeting to hold on July 16 to consider among other things the unaudited financial statement of the company for the half-year ended June 30, 2019.

Ikeja Hotel Plc has its Board meeting scheduled on Friday July 19 to receive and consider among other business, the draft secondquarter (Q2) financial statement of the company and the payment of interim dividends on the Q2 accounts.