This week, Nigeria’s stock 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.
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.
Nigeria’s stock market closed last week with negative return year-to-date (YtD) at -2.51percent.
The loss (N118billion) recorded last week due to sell pressure that dominated in three of the five trading sessions of the Nigerian Exchange Limited (NGX) no doubt offers re-entry opportunities for investors into value stocks now trading at new lows.
“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.
