MARKET UPDATE FOR OCTOBER 5, 2017
VOLATILITY PERSISTS AMIDST PORTFOLIO
REPOSITIONING, SPECULATION, AHEAD OF Q3 EARNINGS SEASON
Nigeria’s stock market indices had an
interesting but volatile session on Thursday. The day opened with the benchmark
index in the red, moving to strong support level by midday, after which it had
a strong rally between midday and the afternoon session as high cap stocks
appreciated in value, following which the day closed significantly positive.
There was a breakout of strong resistant
level of 35,680 as intraday rally hit high of 35,778.98, from a low of
35,155.08 which is around the new month’s support level. The current breakout
of the consolidated sideways narrow range resulted from portfolio repositioning
and speculations ahead of expectations that the earnings season that had just
kicked off with light reporting from few companies would rev into steam.
Already, more companies have been announcing their Q3 closed period in
preparation of making the actual numbers available within stipulated 30-day
grace period after quarter end by regulators of the market, which ends on
October 31.
The smart recovery recorded on Thursday was
on the back of a high volume, positive market breadth and high buying pressure
as revealed by the volume index for the day that stood at 1.24, while buying
position was at 100% and 0% selling volume of the day’s transaction. The trend
was a continuation of previous day’s up market but on an even stronger positive
technicals that support new uptrend that would be confirmed by sentiment when
trading session opens on Friday morning.
The All Share index gained 415.41 basis
points to close at 35,773.98 from an opening figure of 35,358.57 which represented a 1.17% growth, just as market
capitalisation for the day went up by N142.99bn to close at N12.314tr, from the
previous session’s N12.171tr, representing a 1.17% value gained in investors’
portfolios.
The upturn in the share prices of blue
chips companies like Lafarge Africa,
Dangote Cement, UBA, Zenith Bank, Access Bank, NB, Nestle, FBNH and Guaranty
Trust Bank impacted positively on the ASI’s year-to-date return, which stood at
33.11%, just as market capitalisation grew by N3.06tr within the same period,
representing a 33.17% rise above the year’s opening value.
Market breadth for the day remained positive
with an increased number of advancers, thereby outweighing the
decliners in the ratio of 31:14 on a high volume traded
that was higher than previous day’s level to continue the bull transition.
Market activities for the day, in terms of
volume and value, were up by 81.74% and 4.78% respectively to 317.44m shares
worth N2.85bn, up from previous day’s 174.67m units valued at N2.72bn.
Transactions in the shares of Skye Bank, UBA,
Transcorp, McNichols and Access Bank topped the volume chart.
At the close of trading on Thursday, Linkage
Assurance topped the advancers’ table, chalking 8.70% to close at N0.75 per
share on market forces, followed by Presco’s 5.00% notch at N61.95 per
share on expectation of its Q3 numbers.
On the flipside, Cadbury dropped 5.00% to close
at N10.26 on market forces and profit taking, followed by MRS Oil lost 4.97% to
close at N28.88 on market forces/sentiments.
TODAY’S OUTLOOK
As the market opens this morning, expect
volatility to persist owing to portfolio repositioning and earnings season
speculation that kicked off with traders returning to play the season ahead of
year-end seasonality.
One thing that is clear in the current market
situation is that smart investors are accumulating and enhancing their
positions in selected stocks.
Again, we advise that investors allow numbers to
guide their decisions while repositioning for the rest of the year trading
activities, especially now that prices of stocks are looking down amidst
improving economic and market fundamentals.
It is time to use your technical tools to take decision by knowing
the support and resistant level to reposition or exit any position.
Market is in phases know it in order to manage your trading and
investing risk. For stocks that should be on your shopping list to buy in this
oscillating market or pullbacks sign up to INVESTDATA BUY AND SELL signal setup
by calling 08032055467.
Get your home study pack today and ride with the current recovery on
Nigeria’s stock market and economy. By investing and trading knowledgeable in
this recovery market.
The workshop materials on Trading and Investing
for Financial Independence series are Available. Kindly call or send yes to
08032055467 or 08111811223.
Ambrose Omordion
CRO | Investdata Consulting Ltd
ambrose.o@investdataonline.com
Tel: 08028164085, 08032055467
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