Feb. Outlook: Expect Portfolio Reshuffling, As Investors Stay With Fundamentals
Feb. Outlook: Expect Portfolio Reshuffling, As Investors Stay With Fundamentals
January market Review and Outlook
The 2017 bull-market on the Nigerian Stock Exchange (NSE) extended to the first month 2018, defying what had come to be known and accepted as the “January effects,” a coinage that resulted from the fact that the month had repeatedly closed in red a investors were believed to besiege the market for funds to settle pressing demands after the December spending spree.
At the close of trading for the month of January 2018, the composite NSE All-Share index record a 15.95% gain, the highest over the past two decade, according to data mined by Investdata Consulting Ltd.
The significant gain is attributable to the renewed local and international investor confidence in the Nigerian market, arising from the undervalued nature and the intrinsic value inherent in most stocks on the bourse. Recall that the NSE had suffered a three-year back-to-back string of losses, before the 2017 rebound, just as the economy also recovered from the 2016 recession after 25 years of economic progression.
This is also without undermining the overall effects of the stability in the economy, which has also been helped by the Central Bank of Nigeria (CBN) intervention in the foreign exchange market with the introduction of the Investors and Exporters’ window at the inter-bank market.
January Market Performance over 2 Decade
The January up-market, arising from the renewed investor confidence in Nigeria catapulted the NSE it to the top of the world’s markets with the help of the CBN’s new policy that ensured relative stability in the exchange rate of the Naira, while in the process boosting the nation’s manufacturing sector, leading also to positive economic data. It also attracted forex inflows from direct and portfolio foreign investors of about $1bn last year. This also resulted in the nation’s improved external reserve which gave foreign investor confidence, supported by the twin advantages of rising crude oil price to the $70 per barrel threshold, just as production output was mostly high, given the peace in Nigeria’s oil-rich Niger-Delta region where modular refineries, with host communities to own substantial stakes are billed to come on stream in the next 12 to 14 months, going by agreements already signed by the Bayelsa and Edo State governments.
Also, the impact of reforms policies such as the Ease of Doing Business, the gradually sliding inflation figure, improvement in Purchasing Managers’ Index (PMI), all of which are reflecting in as economic activities, thereby reflecting on the purchasing power of Nigerians and growth in GDP. Investdata believes, all of these are tips of the iceberg, only if the government is serious about plugging loop-holes inherent in its revenue generation machinery and spending priorities, while curbing waste in government, especially the cost of projects.
Activities in the 22 trading days of January on the NSE were mixed, comprising 14 sessions of up and eight days of down market to close on a positive note at 44,343.65 points after touching the month’s high of 45,321.82 and low of 37,646.88 from an opening figure of 38,243.19.
The buying volume of total transactions for the month was 68% and selling, 32% to continue December’s bullish market, just as market capitalisation for the month gained N2.29tr after closing at N15.9tr, from an opening value of N13.61tr, representing a 16.83% appreciation in value. The market had mixed sentiments in expectations of 2017 earnings reporting season due to most stocks trading above book value and new 52-week high.
Market breadth for the month was positive and strong as the number of advancers outnumbered decliners in the ratio of 79:15 to continue the bullish transition of four months to sustain the December Santa Claus and OPEC supply cut-induced rally.
The month’s biggest advancers were second tier banking stocks, which were grossly undervalued, comparing their Book Value to market price during the period. Low cap stocks dominated the top 10 gainers, with the best performing being- Skye Bank, a bank that has not released its audited or unaudited result for two years to the market, to enable investors ascertain its financial health, gained 194% of its opening price. It was followed by Unity Bank, which gained 186.78%; Wema Bank, 182.69%; and Diamond Bank, 112%. There were a few medium cap stocks like: FCMB, 106.76%; Sterling Bank, 94.44%; and CCNN, 86.84%; among others.
The worst performing for the month were led by Royal Exchange Assurance, which lost 16%; ABC Transport, 16%; LASACO, 16%; AG Leventis, 14.29%; Airservice 14.29% and GSK, 12.08%.
The month’s traded volume was up by 215.16% to 23.7bn shares, from previous month’s 7.52bn.
During the month also, the following companies released their 2017 full year results, Vitafoam and Niemth Phram, while quarterly reports came from Honeywell, Flour Mills, Guinness, Redstar Express and others. Also within the period, NB, International Brewery, Union Bank, Lafarge Africa and UACN listed additional shares as a result of right issue or bonus shares.
Also, some companies have ushered in the earnings season with strong numbers, particularly from those in the consumer goods sector, which has given insight into what the market should expect from December year end accounts. As traders and investors position for earnings season amidst up and down movement in the bull transition, decision on whether to HOLD, BUY or SELL would depend on whether earnings beat market expectations and shareholders are rewarded adequately in the expected full year scorecards.
Also, it is expected that a continued rise in crude oil price will support Nigeria’s budget implementation, given that the government continues to depend mainly on earnings from that product, while so much is yet still expected from the non-oil sector, especially with the administration’s initiative- the Voluntary Assets and Income Declaration Scheme (VAIDS), beside hope that the economic recovery momentum would be sustained.
Considering the effects of these factors, investors who understand the operations of the stock market should take the correction wave opportunity to enter good stocks, especially as over 100 quoted companies with December 31, 2017 financial year-end are due to release their audited report within the 90-day time frame that ends March 31.
It is obvious that investment is against expectation, therefore, when such expectation is not met there is need to cut losses quickly to protect your capital.
As investors, it is expected that you relate the current selling price of stocks on the floor of the exchange with their third quarter filings, looking at their previous full-year Earnings Per Share, as well as the last dividend paid. This comparison will help you project whether the company is likely to pay better dividend or not before buying into the stock. Earnings have always been a factor considered for equity price movements, in addition to corporate actions of these companies, which are expected to attract more market players, dividend investors and possibly foreign bargain hunters to the market.
Outlook for February and March
In the Nigerian stock market, the month of February is for the early filers, which suggests that traders and investors should be in the market before the results start coming in order to benefit from the earnings season momentum and volatility.
That said, expect a cocktail of:
• Oscillating trend of equity prices as a result of profit taking and disappointment in some results. Also the source of funds brought to the market may cause fluctuations from foreign and domestic institutional investor’s trading in the market. The up and down movement will continue to create entry and exit opportunities.
• More audited earnings would be released into the market this period. Earnings from blue chip companies may strengthen market fundamentals, especially from United Capital, Forte Oil, Nigerian Breweries and Nestle
• Investors to reshuffle their portfolios to invest in some fundamentally strong equities with high Dividend Yield and possibility of bonus, ahead of the audited financials’ release. We should expect stock prices to be in the upward direction if numbers beat expectations.
• A more vibrant market as market players position for the last month of the quarter (March) and profit taking, while repositioning for the earnings season. As we expect liquidity to improve with more foreign funds entering, while keeping their eye on the elections timetable released by the Independent National Electoral Commission (INEC).
• Market outlook for the month of February and March are still very dicey but investors should invest wisely, using dates, bids, offers and volume when taking decisions.
• Managing risk and protecting capital at this point is very important. As such you must be able to determine when to buy or sell by watching the stocks and the market, using technical analysis and investdata buy & sell signal.
• Let numbers emanating from companies and release/markdown dates guide you into profitable investment.
Chart Summit! Chart Summit!! Chart Summit!!!
Investdata Consulting Ltd is organizing another workshop where experts would simplify market jargons with the aim of increasing understanding and increasing the pool of retail investors.
Theme: ABC of Technical Analysis for the Novices and Advance Traders
Have you traded the stock market before and failed? It is a known fact that about 90% of those who trade without knowledge and understanding of the dynamics will end up losing 90% of their capital most of the time. You don’t have to be one of them.
Therefore, when you attend this Practical ABC Technical Analysis conference, you would learn how to trade such that you become one of the lucky 10%, who manage to consistently play the market profitable by themselves through our SIMPLE trading strategies and buy & sell signal setup.
Consistency is the key to equity trading and investing successfully.
At investdata we have been teaching investors simple and proven strategies which when implemented makes you a successful trader and investor in any market situation, especially when it comes to equipping you well enough to know how to protect their portfolios and profit from market corrections in a recovering economy.
We have also, over time, focused attention on attuning the mindset of investors and traders to managing risk, while eliminating emotions when trading so as to avoid irrational investment decisions.
Attend the Practical Chart Summit on Technical Analysis for the Novices and Advance Traders. We would be taking participants through:
• Understanding the momentum behind current equity movement and when to exit using SIMPLE Technical Indicators and Tools to avoid losing capital and profit.
• Our team of experts and time-tested resource persons will show you how you too can successfully and confidently trade and invest in stocks profitably on your own from your phone, laptop and/or desktop computer.
• Know what the smart money are doing
• Know what they are buying
• How you should buy what they are buying.
The workshop is scheduled as follows:
DATE: February 24. 2018
TIME: 10am – 3.00pm
VENUE: Ostra Hall & Hotel, Behind MKO Abiola Gardens, Opposite NNPC Gas Plant, CBD, Alausa, Ikeja. Lagos.
What you will learn at the Technical Analysis Chart Conference
1. The 3 Simple trading secrets that can help anyone succeed at investing
2. The tenets of stock trading and investing Using TA
3. Trading and investing strategies that will help you manage your risk, protect your capital and profit from market oscillation.
4. How to trade on your own online.
5. The psychology of trading and investing and how it will make you successful.
Registration is ongoing
There will be sales of stock trading and investing materials at the end of the conference, Fundamental and Technical Analysis materials, including home study packs you can play and viewed on your phone, laptop and television set. All at 20% discount for attending. You need to prepare yourself and profit from the market and the recovery economy to truly achieve your financial independence and freedom in this New Year.
For more enquiries about the programme, please call 08032055467, 08179547605, and 08111811223.
http://investdata.com.ng/2018/02/feb-outlook-expect-portfolio-reshuffling-investors-stay-fundamentals/#more
January market Review and Outlook
The 2017 bull-market on the Nigerian Stock Exchange (NSE) extended to the first month 2018, defying what had come to be known and accepted as the “January effects,” a coinage that resulted from the fact that the month had repeatedly closed in red a investors were believed to besiege the market for funds to settle pressing demands after the December spending spree.
At the close of trading for the month of January 2018, the composite NSE All-Share index record a 15.95% gain, the highest over the past two decade, according to data mined by Investdata Consulting Ltd.
The significant gain is attributable to the renewed local and international investor confidence in the Nigerian market, arising from the undervalued nature and the intrinsic value inherent in most stocks on the bourse. Recall that the NSE had suffered a three-year back-to-back string of losses, before the 2017 rebound, just as the economy also recovered from the 2016 recession after 25 years of economic progression.
This is also without undermining the overall effects of the stability in the economy, which has also been helped by the Central Bank of Nigeria (CBN) intervention in the foreign exchange market with the introduction of the Investors and Exporters’ window at the inter-bank market.
January Market Performance over 2 Decade
The January up-market, arising from the renewed investor confidence in Nigeria catapulted the NSE it to the top of the world’s markets with the help of the CBN’s new policy that ensured relative stability in the exchange rate of the Naira, while in the process boosting the nation’s manufacturing sector, leading also to positive economic data. It also attracted forex inflows from direct and portfolio foreign investors of about $1bn last year. This also resulted in the nation’s improved external reserve which gave foreign investor confidence, supported by the twin advantages of rising crude oil price to the $70 per barrel threshold, just as production output was mostly high, given the peace in Nigeria’s oil-rich Niger-Delta region where modular refineries, with host communities to own substantial stakes are billed to come on stream in the next 12 to 14 months, going by agreements already signed by the Bayelsa and Edo State governments.
Also, the impact of reforms policies such as the Ease of Doing Business, the gradually sliding inflation figure, improvement in Purchasing Managers’ Index (PMI), all of which are reflecting in as economic activities, thereby reflecting on the purchasing power of Nigerians and growth in GDP. Investdata believes, all of these are tips of the iceberg, only if the government is serious about plugging loop-holes inherent in its revenue generation machinery and spending priorities, while curbing waste in government, especially the cost of projects.
Activities in the 22 trading days of January on the NSE were mixed, comprising 14 sessions of up and eight days of down market to close on a positive note at 44,343.65 points after touching the month’s high of 45,321.82 and low of 37,646.88 from an opening figure of 38,243.19.
The buying volume of total transactions for the month was 68% and selling, 32% to continue December’s bullish market, just as market capitalisation for the month gained N2.29tr after closing at N15.9tr, from an opening value of N13.61tr, representing a 16.83% appreciation in value. The market had mixed sentiments in expectations of 2017 earnings reporting season due to most stocks trading above book value and new 52-week high.
Market breadth for the month was positive and strong as the number of advancers outnumbered decliners in the ratio of 79:15 to continue the bullish transition of four months to sustain the December Santa Claus and OPEC supply cut-induced rally.
The month’s biggest advancers were second tier banking stocks, which were grossly undervalued, comparing their Book Value to market price during the period. Low cap stocks dominated the top 10 gainers, with the best performing being- Skye Bank, a bank that has not released its audited or unaudited result for two years to the market, to enable investors ascertain its financial health, gained 194% of its opening price. It was followed by Unity Bank, which gained 186.78%; Wema Bank, 182.69%; and Diamond Bank, 112%. There were a few medium cap stocks like: FCMB, 106.76%; Sterling Bank, 94.44%; and CCNN, 86.84%; among others.
The worst performing for the month were led by Royal Exchange Assurance, which lost 16%; ABC Transport, 16%; LASACO, 16%; AG Leventis, 14.29%; Airservice 14.29% and GSK, 12.08%.
The month’s traded volume was up by 215.16% to 23.7bn shares, from previous month’s 7.52bn.
During the month also, the following companies released their 2017 full year results, Vitafoam and Niemth Phram, while quarterly reports came from Honeywell, Flour Mills, Guinness, Redstar Express and others. Also within the period, NB, International Brewery, Union Bank, Lafarge Africa and UACN listed additional shares as a result of right issue or bonus shares.
Also, some companies have ushered in the earnings season with strong numbers, particularly from those in the consumer goods sector, which has given insight into what the market should expect from December year end accounts. As traders and investors position for earnings season amidst up and down movement in the bull transition, decision on whether to HOLD, BUY or SELL would depend on whether earnings beat market expectations and shareholders are rewarded adequately in the expected full year scorecards.
Also, it is expected that a continued rise in crude oil price will support Nigeria’s budget implementation, given that the government continues to depend mainly on earnings from that product, while so much is yet still expected from the non-oil sector, especially with the administration’s initiative- the Voluntary Assets and Income Declaration Scheme (VAIDS), beside hope that the economic recovery momentum would be sustained.
Considering the effects of these factors, investors who understand the operations of the stock market should take the correction wave opportunity to enter good stocks, especially as over 100 quoted companies with December 31, 2017 financial year-end are due to release their audited report within the 90-day time frame that ends March 31.
It is obvious that investment is against expectation, therefore, when such expectation is not met there is need to cut losses quickly to protect your capital.
As investors, it is expected that you relate the current selling price of stocks on the floor of the exchange with their third quarter filings, looking at their previous full-year Earnings Per Share, as well as the last dividend paid. This comparison will help you project whether the company is likely to pay better dividend or not before buying into the stock. Earnings have always been a factor considered for equity price movements, in addition to corporate actions of these companies, which are expected to attract more market players, dividend investors and possibly foreign bargain hunters to the market.
Outlook for February and March
In the Nigerian stock market, the month of February is for the early filers, which suggests that traders and investors should be in the market before the results start coming in order to benefit from the earnings season momentum and volatility.
That said, expect a cocktail of:
• Oscillating trend of equity prices as a result of profit taking and disappointment in some results. Also the source of funds brought to the market may cause fluctuations from foreign and domestic institutional investor’s trading in the market. The up and down movement will continue to create entry and exit opportunities.
• More audited earnings would be released into the market this period. Earnings from blue chip companies may strengthen market fundamentals, especially from United Capital, Forte Oil, Nigerian Breweries and Nestle
• Investors to reshuffle their portfolios to invest in some fundamentally strong equities with high Dividend Yield and possibility of bonus, ahead of the audited financials’ release. We should expect stock prices to be in the upward direction if numbers beat expectations.
• A more vibrant market as market players position for the last month of the quarter (March) and profit taking, while repositioning for the earnings season. As we expect liquidity to improve with more foreign funds entering, while keeping their eye on the elections timetable released by the Independent National Electoral Commission (INEC).
• Market outlook for the month of February and March are still very dicey but investors should invest wisely, using dates, bids, offers and volume when taking decisions.
• Managing risk and protecting capital at this point is very important. As such you must be able to determine when to buy or sell by watching the stocks and the market, using technical analysis and investdata buy & sell signal.
• Let numbers emanating from companies and release/markdown dates guide you into profitable investment.
Chart Summit! Chart Summit!! Chart Summit!!!
Investdata Consulting Ltd is organizing another workshop where experts would simplify market jargons with the aim of increasing understanding and increasing the pool of retail investors.
Theme: ABC of Technical Analysis for the Novices and Advance Traders
Have you traded the stock market before and failed? It is a known fact that about 90% of those who trade without knowledge and understanding of the dynamics will end up losing 90% of their capital most of the time. You don’t have to be one of them.
Therefore, when you attend this Practical ABC Technical Analysis conference, you would learn how to trade such that you become one of the lucky 10%, who manage to consistently play the market profitable by themselves through our SIMPLE trading strategies and buy & sell signal setup.
Consistency is the key to equity trading and investing successfully.
At investdata we have been teaching investors simple and proven strategies which when implemented makes you a successful trader and investor in any market situation, especially when it comes to equipping you well enough to know how to protect their portfolios and profit from market corrections in a recovering economy.
We have also, over time, focused attention on attuning the mindset of investors and traders to managing risk, while eliminating emotions when trading so as to avoid irrational investment decisions.
Attend the Practical Chart Summit on Technical Analysis for the Novices and Advance Traders. We would be taking participants through:
• Understanding the momentum behind current equity movement and when to exit using SIMPLE Technical Indicators and Tools to avoid losing capital and profit.
• Our team of experts and time-tested resource persons will show you how you too can successfully and confidently trade and invest in stocks profitably on your own from your phone, laptop and/or desktop computer.
• Know what the smart money are doing
• Know what they are buying
• How you should buy what they are buying.
The workshop is scheduled as follows:
DATE: February 24. 2018
TIME: 10am – 3.00pm
VENUE: Ostra Hall & Hotel, Behind MKO Abiola Gardens, Opposite NNPC Gas Plant, CBD, Alausa, Ikeja. Lagos.
What you will learn at the Technical Analysis Chart Conference
1. The 3 Simple trading secrets that can help anyone succeed at investing
2. The tenets of stock trading and investing Using TA
3. Trading and investing strategies that will help you manage your risk, protect your capital and profit from market oscillation.
4. How to trade on your own online.
5. The psychology of trading and investing and how it will make you successful.
Registration is ongoing
There will be sales of stock trading and investing materials at the end of the conference, Fundamental and Technical Analysis materials, including home study packs you can play and viewed on your phone, laptop and television set. All at 20% discount for attending. You need to prepare yourself and profit from the market and the recovery economy to truly achieve your financial independence and freedom in this New Year.
For more enquiries about the programme, please call 08032055467, 08179547605, and 08111811223.
http://investdata.com.ng/2018/02/feb-outlook-expect-portfolio-reshuffling-investors-stay-fundamentals/#more
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