MARKET UPDATE FOR JUNE 28, 2017




ANOTHER TIME FOR CAUTION AMIDST MONTH-END WINDOW DRESSING

Nigeria equity market on Wednesday had a definite turn-around on improved demand for stocks after three straight days of pullback as a result of massive sell-off that coincided with profit booking and reaction to the non-inclusion of Nigeria in the last review of the Morgan Stanley Capital International (MSCI) Frontier market index of emerging markets.

The Nigerian Stock Exchange (NSE) benchmark index gapped after being down at the early hour of the trading session, and retraced up dramatically. The price appreciation of high cap stocks triggered a very strong rally that ran into the closing hours and consolidated. 
The day’s trading volume index stood at 0.77 on a buying position of 100%, while selling volume was 0% of the total volume traded.

As the market looks forward to another positive Purchasing Managers’ Index (PMI) for the month of June, and ahead of the Q2 earnings reporting season which is likely to trend up in continuation of the first quarter corporate numbers that were positive and strong and had continued to support the current upsurge in prices. In addition to improving macro-economic indices that confirm economic recovery.
Stock markets around the world were mixed to close Wednesday higher, despite oil price sliding down and global rates oscillating as the European Central Bank (ECB)intends to set expectations that it might be moving toward the exit doors on QE and zero interest policy. This bottomed out world rates that propped US rates further. The Bank of England piled on yesterday talking about rate normalization soon, which might be the beginning of another global tightening that would affect assets classification and movement in the world economies and markets. 

Meanwhile, the composite NSEAll-Share index gained 535.16 basis points to close at 32,657.30 after opening at 32,122.14 points, representing a 1.67% growth on above average traded volume of the market. It was however marginally lower when compared to previous day’s transaction level. Similarly, market capitalisation for the day was up by N185.06bn to close at N11.29tr, from an opening value of N11.11tr, representing 1.67% value gained.

The upturn in share of prices of highly capitalized equities impacted positively on the All-Share index, raising its year-to-date return to 21.52%. Also, growth in market capitalisation for the same period stood at N2.21tr, representing a 22.16% gain above the year’s opening value.
Market breadth for the day was positive as the number of advancers outpaced decliners in the ratio of 26:21 on high volume of trade to halt the three straight days of bear transition.  
Market activities in terms of volume and value were mixed as traded volume was down by 7.50% to 386.24m shares from previous day’s 417.57m, while value was up by 1.75% to  N3.3bn against the previous day’s of N3.25bn.

Transactions in the shares of UBA, WEMA BANK, GUARANTY TRUST BANK, FCMB and TRANSCORP topped the volume chart to close the day’s trade.
At the end of trading, UBA topped the advancers’ log with its share price gaining 8.17% to close at N9.00 each, on expectation of Q2 numbers, among others. It was followed by NEM 7.37% gain to close at N1.02 per share, on market forces and expectation of closure date for 6 kobo dividend ahead of it Q2 numbers.

On the flipside, Okomu OilPalm led the decliners’ log, after dropping 4.99% to close at N58.49 on profit taking, while Julius Berger followed with 4.99% to close at N39.45 each on profit taking.
The management of Unilever Plc yesterday announced the submission of its application to The Exchange for approval and listing of a Rights Issue of 1,961,709,167 Ordinary Shares of 50 Kobo each at N30.00 per share. Allotment is on the basis of 14 new ordinary share for every 27 ordinary share held.The qualification date for the said right issue is 28th June, 2017.

The management of Conoil Plc announced its plan to propose a cash dividend of N3.10 per share in its 47th AGM scheduled for August 11, 2017. According to the report, if approved, dividend warrant would be posted on the August 12. Closure date is July 7, 2017.

TODAY’S OUTLOOK

As the market opens this morning, expect mixed performance due to end of the month window dressing and continue repositioning in value stocks ahead Q2 earnings season. Investors should not panic on the recurrent pullbacks if they have taken position based on strong numbers and future prospects of any stock.

Again, we advise that investors allow numbers to guide their decisions to reposition for the rest of the year’s trading activities, especially now that prices of stocks are looking up ahead of recovery economic fundamentals, if the numbers will support the price reversal or continuation.
It is time to use your technical tools to take decision by knowing the support and resistant level to reposition or exit any position.

Once more, at the risk of repeating oneself, we must reiterate that industry potential is very important when picking a stock, because there are factors that are sector-specific and would naturally impact positively or negatively on companies operating within such an industry, especially now that the economy is recovering. For stocks that should be on your shopping list to buy in this up market or pullback sign up for investdata buy & sell signal setup by calling 08032055467.

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Workshop on COMPREHENSIVE SHORT-TERM TRADING STRATGIES FOR REST OF THE YEAR & BEYOND

Sub Topics:
1. The Toolbox of Successful Traders & Technical Analysts- Mr Meshach Ukpoma, FX Analyst/Trader
2. Outlook and Implications of the 2017 Budget & Petroleum Industry Governance Bill (PIGB) on Nigeria’s Stock Market and Economy- AbiolaRasaq, Group Head Investor Relations, UBA
3. A Strategic Outlook; The Fusion of Fundamental & Technical Analysis- Ambrose Omordion, Chief Research Officer Investdata Consulting Ltd
4. Understanding Market Timing to Manage Risk, Using Technical Analysis - Mr. Abdul-Rasheed  Momoh, Head, Capital Markets, TRW Stockbrokers Limited
The workshop holds on:
DATE: 15 July 2017
TIME: 9.00am
VENUE: Ostra Hall & Hotel, Behind MKO Abiola Gardens, Opposite NNPC Gas Plant, CBD, Alausa, Ikeja. Lagos.

The fee is N20, 000 per participant. Payment made a week before the date of the event attracts 10% discount. Companies sending more than two representatives would enjoy a 15% discount.  Payment should be made into: Zenith Bank; Account Name: InvestData Consulting Limited; Account Number: 1013033032.
For more enquiries about the programme, please call 08032055467, 08179547605, and 08111811223  

MR. OMORDION AMBROSE
CHIEF RESEARCH OFFICER
INVESTDATA CONSULTING LIMITED
ambroseconsultants@yahoo.com
TEL:01-4724645, 08028164085 




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