Stock Market Sustains Bullish Momentum

The Nigerian equity market benchmark index trended northwards at the close of today’s trading session owing to sustained buying interest in blue-chip Banking and Consumer Goods stocks. As such, the All Share Index (ASI) advanced 0.6% to settle at 33,797.84 points, increasing YTD return to +25.8%. Today’s performance was driven by gains in ZENITH (+4.6%), NIGERIAN BREWERIES (+2.3%), GUARANTY (+1.7%) and UNILEVER (+5.7%). Similarly, investors recovered N69.0bn as market capitalization settled at N11.7tn. However, activity level was mixed as value traded improved 24.7% and volume traded dipped 24.4% to close at N7.9bn and 573.6m units respectively.

Mixed Performance across Sectors
Contrary to the previous trading session, performance across sectors was mixed as 3 of 5 indices closed in the green. The Banking index gained the most, advancing 1.8% on the back of gains in GUARANTY (+1.7%) and ZENITH (+4.6 %) while price rally in MANSARD (+4.8%) pushed the Insurance index 1.4% northwards. Similarly, the Consumer Goods index appreciated 1.1% as a result of an uptick in NIGERIAN BREWRIES (+2.3%). On the flip side, investor booked profit in Oil & Gas  and Industrial Goods stocks, dragging the sector index down by 1.1% apiece, due to losses in MOBIL (-4.2%), SEPLAT (-1.2%) and WAPCO (-2.7%) respectively.

Investor Sentiment Stays Positive
Investor sentiment stayed positive, although waned slightly as market breadth closed at 1.4x (previously 1.5x) owing to 32 gainers against 23 decliners.  MAYBAKER (+9.8%), SKYEBANK (+9.5%) and UNILEVER (+5.7%) led gainers while the worst performers were CHAMPION (-4.9%), HONYFLOUR (-4.8%) and NEIMETH (-4.4%). We expect investor sentiment to remain strong in the near term against the backdrop of upswing in macroeconomic factor drivers. Yet, investors have to keep an eye on short term downside risks to market performance, which include the unfolding developments in the oil market as well as the CBN’s FX policies.