By Yakubu LAAH InvestAdvocate
Lagos (INVESTADVOCATE)-Nigerian stocks on Friday reversed its downward trend after negative closes on the first two sessions of the trading week, the all share index (ASI) gained 1.33 percent week-on-week (WoW).
“This week’s performance was largely a factor of investors reentering the market in order to take advantage of cheap valuations,” Cordros weekly market update said.
According to the report, the Banking and Cosnumer Goods indices topped the gainers chart with 9.45 percent and 1.98 percent following increases in share price of Nigeria’s top tier lender, Zenith Bank Plc and brewer, Nigerian Breweries Plc both climbing up by 19.70 percent and 11.43 percent respectively.
On the contrary, the Cordros weekly update affirmed that the Oil & Gas and Industrial Goods indices were pushed lower by 5.19 percent and 3.52 percent respectively following declines in the shares of first listed Nigerian oil and gas upstream firm, Seplat Petroleum Development Company Plc by 11.44 percent and cement manufacturer, Lafarge Cement WAPCO Nigeria Plc by 5.48 percent.
In the same vein, the Insurance index dipped by 0.23 percent closing marginally lower as insurer, Custodian & Allied Insurance Plc shed 1.18 percent.
At the end of the week’s trading on the Nigerian bourse, market breadth posted a positive outlook with 33 gainers and 32 losers.
Cordros say volume traded at the close of the week increased by 49.13 percent to 2.18 billion shares worth N10.75 billion in 21,471 deals.
It report that insurer, Equity Assurance Plc (764.30 million), lenders First City Monument Bank (193.24 million) and ZENITHBANK (168.80 million) accounted for 22.67 percent of shares traded during the week. Also, Guaranty Trust Bank Plc (N1.96 billion), ZENITHBANK (N1.75 billion) and Nigerian Breweries (N1.19 billion) were the top traded stocks by value, accounting for 72.83 percent of shares traded during the week.
In terms of global equities, the Cordros update say global stocks were dragged down by China’s twenty-five year record-low GDP growth and plummeting oil prices – following Iran’s re-entrance into the market – as fears grow on an impending global recession in 2016.
According to the report, the Wall Street tumbled to 2014-lows as oil fears sucked earlier China optimism. “More so, weak inflation, housing data and a rise in jobless claims also dampened investors’ appetite; reducing the likelihood of rate hike by US Fed rate in March. However, badly bruised US stocks rose on glimmers of hope as oil prices rebounded to $30 at the later part of the week. The S &P and DJIA shed 0.60 percent and 0.66 percent w/w at the time of writing,” the Cordros report affirmed.
It reported that Euro shares showed some resilience at the early sessions of the week, following rising prospect of a March policy easing outlook amid an unchanged 2016 outlook for the entire region. “Markets soon took a downturn as Germany faces volatile economic environment against the backdrop of declining consumer confidence in the Eurozone,” Cordros added.
The weekly update says that the FTSE 100 and Euro Stoxx recorded respective losses of 0.52 percent and 0.29 percent w/w at the time of writing.
“China’s focus in the global equities space has heightened following even weaker growth and economic data. Disappointing property investment, and power and steel output data dragged the market lower. Notwithstanding, expectations of further economic stimulus spiked China’s stocks to claw back gains, closing a marginal 0.17 percent down w/w. On the other hand, worries on Japan’s policy direction and sinking economy depressed the Nikkei by 1.10 percent w/w. The MSCI Emerging and Frontier markets also plunged by 2.91 percent and 2.85 percent w/w at the time of writing,’ the Cordros update affirmed.
