Bargain Hunters Utilise Pullbacks To Position In Dividend Stocks, Expected Financials

Market Update for March 8, 2018

Nigeria’s stock market index rebounded on Thursday to finish well on a strong buying sentiment and volatility. It was a very mixed session and a consolidation day which started out with a gap to the downside before retracing up gradually by the mid-morning, remaining above the psychological line of 43,000 basis points. This very formidable resistance will further breakout if earnings reports and payout beat expectations. During the trading session investors and traders took position in banking, consumer goods and oil stocks, guided by economic statistics which reveal strong growth in these sectors as of 2017 Q4 and has so far reflected on the few numbers released from such sectors.
The NSE All-Share index’s intraday movement went as low as 42,777.92 from the opening figure of 42,952.70 points, to close the day high at 43,092.63.

The international markets yesterday rebounded after a surprising decision by the European Central Bank (ECB) to retain its rates until September, while the United States formalized its new tariff regime ahead of job market report.
This is just as the relatively high price of oil continues to influence Nigeria’s reserve positively as it continues to attract more direct and indirect investments to the economy, following which economic data remain upbeat since Q2 of 2017.

Thursday’s retracement on the NSE is signals that bargain hunters are taking advantage of the pullbacks to position in dividend paying stocks that are yet to release their scorecards. As the market continue to make higher lows in up direction to support the index trading above its 20 and 50-Day Moving Average on a high volume that supports positive performance as we go into the peak session of earnings reporting season, ahead of Q1 2018 corporate earnings and Q1 economic data.

Market technicals for the day were positive and strong with buying pressure of 100% on a high volume traded, while selling position was 0%. Volume index was 0.52 with money flow index energy weakening at 51.63 point from the previous day’s level of 59.20 points.
Meanwhile, the composite index gained 139.93 points to close at 43,092.63 after opening at 42,952.70 basis points, representing a growth of 0.32% on high traded volume that is higher than the previous day’s. Similarly, market capitalisation for the day was up by N50.27bn to close at N15.48tr from an opening value of N15.4tr which also represented 0.32% gain in investors’ positions.

The session’s upturn was attributed to value gain by stocks likes of Nigerian Breweries, Guaranty Trust Bank, Stanbic IBTC, FBNH, Unilever, Flourmills and Access Bank, which impacted positively on the NSE’s Year-To-Date returns, rising to 12.70%, just as market capitalisation gain for the period improved to N1.88tr, representing 14.10% YTD growth.
All-Share index and other sectorial indexes closed higher, except for the NSE Insurance, NSE Oil/Gas, NSE Industrial and NSE AseM that closed lower for the day due to price depreciation in NEM and AXA Mansard, decline in Forte Oil and Dangote Cement. Market breadth was positive as advancers outnumbered decliners in the ratio of 30:28.

Market activities were mixed as volume was up by 112.63% to 571.81m, from previous day’s 270.33m units, while value was down by 34.48% to N3.39bn, from Wednesday’s N5.18bn.
Transaction volume for the day was boosted by oil and financial services stocks like Capital Oil, Japaul Oil, Multiverse, Zenith Bank and FBNH, which witnessed increased trading to top the activity chart.

The top performing stocks were Japaul Oil and Wapic, which gained 9.90% and 8.6% respectively to close at N0.89 and N0.63 on market sentiment, while C & I Leasing and Regency Insurance were the worst performer shedding 9.28% and 7.5% to close at N1.76 and N0.37 respectively on profit taking and market forces.

http://investdata.com.ng/2018/03/bargain-hunters-utilise-pullbacks-position-dividend-stocks-expected-financials/