Stock market: Here are analysts’ views this week

Nigeria’s equities market which had started this new month on a slightly positive note, rerouted negative at the start of this new week as investors cautiously approach customs street ahead of companies’ half-year (H1) results expected this month.

As companies announce their closed periods in preparation for half year (H1) results, it is expected to further catalyse the market’s journey northwards as investors position for interim dividend.

The market which posted its best half-year (H1) performance in five years had last week reversed the bearish sentiment seen in the preceding week, closing positive week-on-week (WoW).

In the week ended July 1, the market posted positive return of +0.24 percent or N67billion gain amid three (3) trading sessions of gains as against two (2) days of losses, driven by bargains in banking and insurance stocks despite profit taking in consumer goods, oil & gas, and industrial stocks.

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Here are analysts’ views this week

GTI research analysts who acknowledged that the domestic market closed positive last week despite mixed sentiment by investors, said they expect cautious trading to continue this week in the local market.

According to United Capital research analysts said, “we expect continued bargain hunting as investors look forward to the first-half (H1) 2022 earnings season and will seek to take high-yield positions. “Still, we maintain that the broader equities market will remain on a bearish trajectory pending the release of H1-2022 results,” they added.

In their view, Vetiva research analysts who also observed that the market activity started off quiet last week with minimal trades in the first trading session of the month, anticipate further mixed trading sessions this week “as investors continue to trade cautiously amid some bargain hunting activities”.

Also, Lagos-based Meristem research analysts who noted a positive momentum in the market last week also believe the current attractive level of prices especially financial services tickers were major reason for the record bargain hunting.

“Overall, we expect the buying interest to persist this week, bringing the market to a positive close,” Meristem research analysts said.