Bargain Hunting in Banking Stocks Drives Nigerian Equity Index Higher …NSE ASI up 13bps

LAGOS (Capital Markets in Africa) – The Nigerian equities market bucked a 3-day downtrend as bargain hunting in banking stocks drove the index 13bps northwards to settle at 25,936.24 points. The performance was driven by gains in STANBIC(+2.9%), UBA (+2.9%), ZENITH (+1.4%) and GUARANTY (+0.6%). Accordingly, YTD loss eased slightly to -3.5%. Investors, in turn, gained N11.5bn as market capitalization settled at N9.0tn. However, activity level waned as volume and value traded decreased 50.3% and 12.0% to settle at 151.5m units and N1.4bn respectively.

All Indices Close In the Green Save for Oil & Gas Index
Performance across sector was broadly bullish as all indices closed in the green save for the Oil & Gas index which declined 1.6% as losses in FORTE (-9.7%) and SEPLAT (3bps) more than offset gains inOANDO (+4.8%), while the Industrial Goods index closed flat. The Banking index gained the most, up 0.9% on account of buying an interest in UBA (+2.9%) and ZENITH (+1.4%). Likewise, the Insurance and Consumer Goods indices closed 0.6% and 2bps higher consequent on gains in CONTINSURE(+4.7%), AIICO (+1.7%), GUINNESS (+4.2%) and UNILEVER (+0.8%).

Investor Sentiment Improves
Investor sentiment also improved as market breadth (advancers/decliners’ ratio) rose to 1.2x (from 0.3x yesterday) consequent on 20 stocks which advanced against 17 decliners. The top gainers wereUNITYBANK (+5.0), OANDO (+4.8%) and CONTINSURE (+4.7%) while FORTE (-9.7%), UAC–PROP(-9.4%) and TRANSCORP (-5.0%) were the top losers. Today’s market performance was largely attributable to bargain hunters’ interest in banking stocks. We expect the market to close positive tomorrow considering the cheap valuation of stocks that had declined in prior trading sessions this week. However, we expect the market to close the week lower.

Source: Afrinvestor Research Nigeria