Short-Term Positioning for Q4 Earnings Reports Continue On Low Price Attraction

Market Update for February 19


Nigerian stock market took a breather on Monday to start off the week on weak note, after an early gap up in the opening session, but pulled back as the investing public reacted apparently to news that many banks will not pay dividend in 2018 due to their exposure to bad loans as the Central Bank of Nigeria (CBN) seeks to enforce its rules. Going by the rule which has been in force since 2014, many discerning investors already know that banks or companies with negative retained earnings will not pay dividend. This, we have drawn attention to in the past as we reveal banks with negative retained earnings, most of which are still struggling, while one or two have shown improvements, moving out of the categories.

Monday’s emotional sell down as reflected in the volume traded, indicated that knowledgeable investors have repositioned in value companies, especially dividend paying stocks as earnings season kicked off. Market volatility continued as the benchmark index hit intraday high of 42,712.65 from the opening figure of 42,638.83, and then came down in 6-wave declines to successfully breakdown the psychological line of 42,000 that had been the recent strong support level. It was a session wherein highly capitalized stocks shed value to close the day lower, after the market had started another motive wave, with the recovery mode as fund managers continued last minutes reshuffling of their portfolio. With the long awaited earnings reporting season finally here, investors and traders should play the market with less emotion to profit from the season.

Market technicals for the day were weak, with high selling pressure on low volume traded and weak buying position of 0%, volume index was 0.32 with money flow index at 25.84 point.
Meanwhile, the All-Share index shed 650.65 points to close at 41,988.18 basis points after opening at 42,638.83, representing a decline of 1.53% on a low traded volume that was lower than the previous day’s. Similarly, market capitalisation fell by N233.49bn to close at N15.07tr, after opening at N15.3tr which also represented 1.53% value loss in investors’ portfolios.

The downturn resulted from losses suffered by medium and high cap stocks like Nestle Nigeria, Dangote Cement, Nigerian Breweries, Zenith Bank, UBA, FBNH, UACN, Dangote Flour, PZ and Guinness Nigeria. Also on Monday, the share price of Vitafoam was adjusted for 15 kobo dividend recommended by its directors. The loss impacted negatively on the NSE’s Year-To-Date returns, which drop to 9.79%, just as market capitalisation gain for the period dropped to N1.46tr, representing a 10.72% YTD growth.
The Composite and all other sectorial indexes were mixed, whereas market breadth was negative as decliners outpaced advancers in the ratio of 32:16. Market activities in volume and value terms were down to 287.18m shares worth N2.29bn from previous day’s 520.74m units valued at N4.32bn.

Transaction volume for the day was considerably boosted by financial services stocks like Skye Bank, Diamond Bank, FCMB, Jaiz Bank and Zenith Bank which witnessed increased trading to top the activity chart as most traded.

Linkage Assurance and Livestock topped the advancers table for the day with 9.09% and 5.00% gain to close at N0.96 and N1.05 respectively, due to their expected full-year earnings, while the decliners log was led by PZ Cussons, which fell 8.00% on news that the company’s 2018 full-year robust second half performance may be hampered by a more than expected challenging operating environment. Also, the shares of Lasaco Assurance dropped by 6.06% to N0.31 each on profit taking and market forces.

TODAY’S OUTLOOK
Expect short term positioning for Q4 earnings reports and volatility to continue as traders jump into the market on low price attraction ahead of dividend declaration. The relatively low interest rates in the money market and sell-off in the bond market will boost inflow into stock market as fund managers play earnings season for quick returns target high dividend yield stocks,
However, we would like to reiterate that investors should go for equities with intrinsic value, especially during this season that dividend payment is approaching.

We advise investors to allow numbers guide their decisions while repositioning for the rest of the year’s trading activities, especially now that stock prices remain volatile amidst improving company, economic and market fundamentals.
It is time to combine fundamentals and technical tools to take decision by knowing the support and resistant level to reposition or exit any position. Market is in phases know the cycles in order to manage your trading and investing risk. For stocks that should be on your shopping list to buy in this seasonality changes as the year winds down, sign up to INVESTDATA BUY AND SELL signal setup by calling 08028164085.

Get your home study pack on INVEST 2018 Traders & Investors Summit and ride with the current recovery on Nigeria’s stock market and economy. By investing and trading knowledgeable. You can also still access stocks analysed in the home study pack of the INVEST 2018 traders & investors summit, which includes 15 stocks picks for 2018 are available now to guide your positioning as trading for the year just started.

Comprehensive training materials on stock Trading and Investing for Financial Independence series are Available, you can play and watch on your mobile phone, laptop, desktop and Tv. Kindly call or send yes to 08032055467, 08028164086 or 08111811223.

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 Conference 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.

This chart summit is designed specifically for those who:
• Jump out of profit position in fear of giving profits back?
• Indecision in pulling the trigger because you fear the prospects of a loss?
• Holding on to losing positions because you fear taking the loss?
• Trading often leads into unplanned trades because you fear leaving money on the table?
• Small trade size or investing small amount because you’ve just had a large loss?
• Increasing you position size to try and make up for past losses?

This practical workshop is for novice traders, investors, professionals and fund managers who want to overcome fear and improve their trading performance. The workshop is basically on technical analysis and practical charting teaching on evidence-based techniques that is working in today market. Also the power of focused trading and investing strategies that will help participants build mental skills to turn fear into profits and protect capital.

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 2018. Also come with your laptop.

For more enquiries about the programme, please call 08032055467, 08179547605, and 08111811223.
Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467
http://investdata.com.ng/2018/02/short-term-positioning-q4-earnings-reports-continue-low-price-attraction/#more