Nigeria Equity Watch | 1 Sep 2015: Nigerian Equities Sustain Positive Momentum… ASI gained 1.8%

Lagos, Nigeria, Capital Markets in Africa —The Nigerian Equities Market sustained its positive momentum as the benchmark equity index — All Share Index (ASI) – closed positive for the fourth day. The ASI gained 1.8% to close at 30,225.34, paring YTD losses to 12.8%. Market capitalization also added N185.9bn to close at N10.4tn. Today’s bullish performance was mainly due to further bargain hunting in bellwether Banking, Industrial and Consumer Goods counters — GUARANTY (+6.9%), STANBIC (+10.2%) NIGERAIN BREWERIES (+4.2%) and DANGOTE (+1.1%) and WAPCO (+3.0%). Similarly, market activity was impressive as aggregate volume and value traded of equities rose 83.8% and 116.2% to 938.2m units and N7.5bn respectively.

All sector indices closed in the green save for the Oil & Gas index which declined 1.0%, due to profit-taking in FORTE OIL (-1.4%) and CONOIL (-9.7%). The Banking Index led gains, closing 2.8% higher against the backdrop of broad rally in GUARANTY (+6.9%) and ACCESS (+3.1%); followed by the Insurance index (+2.4%) uplifted by the rally in MANSARD (+10.0%). Bargain hunting in NIGERIANS BREWERIES (+4.2%) and PZ (+10.2%) however drove gains in the Consumer Goods index (+2.1%) while the Industrial Goods index closed 1.9% up, buoyed by gains in WAPCO (+3.0%) and DANGOTE CEMENT (+1.1%).

Sentiment in the Nigerian market measured by market breadth improved, pegging 2.0x (39 advancers’ vs. 20 decliners’). The top gaining stocks in the market today include STANBIC (+10.2%), OKOMU OIL (+10.2%), PZ (+10.2% whilst CONOIL (-9.7%), NEIMETH (-8.9%), CWG (-5.0%) led laggards. We suspect that the sustained gaining streak in the bourse is broadly due to bargain hunting in value stocks and renewed investor confidence in the economy due to anticipated clarity in the policy and stability in the FX reserves. However, given the short investors holding period observed of recent, we imagine that the rally may be short-lived as some investors may likely take profit in the sessions ahead. 

Source: Afrinvest (West Africa) Limited Research Team