Market gains N98bn as investors buy bellwether, dividend paying stocks

Bellwether and dividend paying stocks on the Nigerian Bourse continued to trade northwards on Monday September 28 as more investors took positions in the value counters.

The increased bargain seen on Monday pushed the value of listed stocks higher by N98billion. Top on the list of investors picks are stocks like Total Nigeria, MTNN, Okomu Oil, BUA Cement, and Lafarge Africa.

Total Nigeria Plc recorded the highest gain on the Bourse after its share price moved from N80 to N88, adding N8 or 10percent. MTNN also increased from N124 to N126.5, adding N2.5 or 2.02percent.

“In the absence of any negative catalyst, we expect sustained bullish momentum in the equities market. This is to be driven by the unattractiveness of yields in the fixed income market and the availability of low-priced but fundamentally sound tickers. Ultimately, we expect the market to close in the positive zone”, said Lagos-based Meristem research analysts.

The Nigerian Stock Exchange (NSE) All Share Index (ASI) increased by 0.72 percent to 26,507.84 points from preceding day low of 26,319.34 points. The value of listed stock increased to N13.853trillion from preceding trading day low of N13.755trillion. The market’s negative return year-to-date (YtD) decreased to -1.25percent. In 4,602 deals, investors exchanged 336,832,809 units valued at N4.029billion.

“We expect the CBN accommodative policy-induced-rally witnessed last week to subside this week, as a result of profit taking by some active traders. Nevertheless we see the overall market performance index closing the week positive, as market valuation remains attractive for medium and long term investors”, according to GTI research analysts.

Also, Okomu Oil Palm Plc stock price increased from N78 to N80, adding N2 or 2.56percent. BUA Cement increased from N38.55 to N40.4, up by N1.85 or 4.80percent, while Lafarge Africa Plc moved up from N15.05 to N16, adding 95kobo or 6.31percent.

“Going forward, we expect to see the bullish sentiment sustained in the equities market on the back of elevated financial system liquidity as well as the continuously declining returns in the fixed income market and limited investment outlets. As such, we advise investors to take position high quality dividend paying stocks”, said United Capital research analysts in their September 28 note.

“With the continued inflow of funds into the equities market, a number of fundamentally attractive counters continued to witness positive investors’ patronage (evidenced by the positive market breadth coupled with the bullish sectoral performances).

“With yields in the equities market still looking more attractive than those in the fixed income space, we expect a number of bellwether stocks and dividend paying stocks to continue to trade upward as investors increasingly take position in decent counters. However, with the presence of short term players in the market, the possibility of profit taking cannot be overruled”, said Lagos-based research analysts at Vetiva.