Stock market sees slight gain as focus shifts to MPC outcome

Nigeria’s equities market recorded slight gain (+0.05percent or N29billion) on Monday as investors focus shifts to the outcome of the ongoing monetary policy committee (MPC) meeting.

Investors interest in shares of Berger Paints and other top gainers pushed the market higher. Berger Paints share price increased from N12.35 to N13.55, adding N1.20 or 9.72percent.

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The market’s benchmark performance indicators – the Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation increased from preceding trading day’s lows of 98,125.73 points and N55.507trillion to 98,176.58 points and N55.536trillion.

“We expect the lacklustre trading activity to continue this week in the local bourse as we do not foresee any strong positive trigger to sway market direction. We also note that inherent bearish sentiment evinced by the market breadth which fell below 1.00x to 0.52x last week.

“Additionally, expectation of a sustained hawkish stance at the MPC meeting holding this week could further weaken investors’ appetite for equity assets,” according to Meristem research analysts.

The market’s positive close pushed higher the return year-to-date (YtD) to 31.30percent.

In 8,439 deals, investors exchanged 405,661,682 shares worth N6.688billion. Access Holdings, Transcorp, Zenith Bank, Nigerian Breweries and Jaiz Bank shares were actively traded on Monday.

“Thus, the Treasury bills auction this week may prompt outflow of funds and a tepid inflow into the equites market, given the appeal of fixed-income yields. However, we anticipate investors to cherry-pick on some fundamentally strong tickers with attractive entry points,” Meristem research analysts further said.

“This week, we anticipate cautious trading among equity investors as they await the outcome of the MPC meeting. We suggest that investors concentrate on fundamentally strong stocks,” said Futureview Research.