Stock Market Rebounds

Bargain hunting in some bellwether stocks – DANGCEM (+2.7%), NIGERIAN BREWERIES (+2.3%), NESTLE (+1.7%) and UNILEVER (+4.9%) – ended the 2-day bearish run in the local bourse to push the All Share Index 93bps higher to 40,992.97 points while YTD return increased to 7.2%. Accordingly, investors gained N136.8bn as market capitalization rose to N14.8tn. Activity level, was mixed today as the volume traded rose 27.6% to 259.5m units while the value traded declined by 1.5% to N4.4bn. The top traded stocks by volume were DIAMOND (68.6m), ZENITH (33.8m) and GUARANTY (31.4m) while the top traded stocks by value were GUARANTY (N1.4bn), NESTLE (N1.1bn) and ZENITH (N943.1m).

Mixed Sector Performance
Performance across sectors was mixed as 3 of 5 indices under our watch closed northwards. The Consumer Goods index appreciated the most, up 1.6% resulting from bargain hunting in NIGERIAN BREWERIES (+2.3%), NESTLE (+1.7%) and UNILEVER (+4.9%). Similarly, the Industrial Goods and Insurance indices rose 0.7% and 0.3% respectively driven by buy interest in DANGCEM (+2.7%) and MANSARD (+4.7%). On the flipside, the Banking and Oil & Gas indices closed southwards on account of sell pressures in UBN (-5.2%), ACCESS (-1.8%), UBA (-1.3%) and FORTE (-3.1%) which dragged both indices.

Unchanged Investor Sentiment
Investor sentiment as measured by market breadth (advance/decline ratio) remained flat today at 0.5x as 15 stocks advanced against 30 stocks that declined.  Today's top out-performing stocks were CUTIX (+5.0%), UNILEVER (4.9%) and NPFMCRFBK (+4.9%) while SKYE (-9.4%), DIAMOND (-9.1%) and JAPAULOIL (-5.7%) were the top under-performing. Today’s bullish performance which was driven by investors bargain hunting activities is expected to continue to drive market performance for the rest of the week as we believe that valuation on some mid-cap and small-cap stocks still creates attractive entry opportunities into these stocks.