December Outlook: Shopping For Santa Claus, Year End Rally On NGSE

In recent times, global economic performance has turned positive, with a healthy pace of recovery judging by data emanating from the developed economies in the form of strong GDP numbers. This is however now being threatened by the ongoing trade war between China and the U.S in the midst of declining in commodity prices, especially crude oil.

These are compounded by the Brexit and others which remain veritable reasons for concern among investors and regardless of the signals such as the interest rates now being tightened which is capable of redirecting the flow funds to boost economic growth that would push stock markets up again after the recent correction gale.

Back home, the possibility of the Nigerian stock market rebounding pre, or post the February 16 Presidential election is high, considering the recent over-subscription of the nation’s $2.5bn Eurobond, which is enhancing recently the gradual but steady upward movement in the nation’s external reserves. There is also expected year-end increase in portfolio repositioning ahead of 2019 where equity prices are low and undervalued.

Recent report from Bank of America shows that investors’ funds to emerging markets increased from 5% in October 2018 to 13% by November.
Expectedly, the biggest rebounds in global markets should be emerging markets, given that the MSCI composite index had suffered 27% fall from the January highs. The low sovereign debt and growth outlook in emerging markets will support a rebound and drive equity prices as the end of rate normalization is near and Treasury Yield has started looking down. The 10-year ends the week well off the highs of the past two months, and at the important 3% level.

Due to end of year expectations that triggered economic activities in the last two months of the quarter as reflected in the positive macro-economic data such as the November Purchasing Managers Index (PMI) released by the Central Bank of Nigeria (CBN). The index has further expanded to 57.9 points from 56.8 points in October, signaling recovery in the manufacturing sector. This data will be appreciated when considered against Q3 numbers from the sector were below market and analysts’ expectations.

With one or two quarterly earnings expected in this month, as well as new trading patterns that will unfold due to seasonal changes, as investors and traders will likely reposition and balance their portfolios ahead of 2018 full year earnings in 2019. This is based on their interpretation of the scorecards and changes that will keep the market oscillating, looking at the low entry points and expected high Dividend Yield at the peak of earnings season in March 2019.

The Q3 numbers released shows the earnings position and health of the listed companies and indeed the market, while stocks that had suffered huge losses but have strong fundamental should be the target of investors and traders, given their high upside potentials. Such strong intrinsic values remain a plus and should guide investors to know where to look while seeking to invest profitably for the remaining days of the year and beyond.

Traders and investors who understand the importance of combining fundamental and technical analysis to make investment decisions in the stock market should take this opportunity of a prolonged pullback in prices to position in some sectors for short, medium- and long-term gains. Operators should search for such goldmines especially in sectors like banking, conglomerates, industrial goods, oil and consumer goods, after a carefully study of the recent price patterns and fundamental data available in the market.

What to expect in December
• Expect oil price oscillation to continue and to influence government revenue positively or negatively, depending on the outcome of this weekend’s meeting of the Organisation of Petroleum Exporting Countries (OPEC).
• Improved liquidity should be envisaged in the market, especially with the Eurobond proceeds being used to finance Nigeria’s 2018 budget, besides electoral campaign spending that have already kicked off and is expected to flow into the market in form of portfolio investment that will support the market.
• Seasonal trending with few late filers of quarterly numbers expected, with much or no impact on the market, depending on the strength of the numbers. However, blue-chip companies will continue to oscillate on the strength of company and market fundamentals as repositioning and rebalancing stays till year-end.
• The oscillating trend of equity prices as a result of portfolio repositioning along the line of positive numbers by foreign and local investors that will boost activities in this last month of the year.
• Market outlook for the new month remains mixed as few quarterly and one full year earnings are expected. The return of positive sentiments and strong momentum may not be ruled out as the market expects the improving economic activities to be sustained with the last-minute implementation of the 2018 budget. This will be if government shows interest again in the economy, instead of the current situation where all attention is on politics and 2019 elections.
• The relative low Price-to-Earnings ratio in the market may further attract demand for stocks. However, all must however invest wisely using technical and fundamental analysis when taking decisions.
• Managing risk and protecting capital at this point is very important, so you will be able to determine when to buy or sell, by watching the stocks and the market, using technical analysis.
• Let numbers released by companies guide your decision and timing how long to stay in that position.
• Know the categories of stocks that will rally after the presidential election, if PDP or APC wins, by joining us at the INVEST 2019 TRADERS & INVESTORS SUCCESS SUMMIT holding at Ostra Hotel & Hall, Alausa, Ikeja opposite NNPC Gas Plant. December 8, 2018.

To start your journey to financial success in 2019, join us at the INVEST 2019 TRADERS & INVESTORS SUCCESS SUMMIT

In view of the prolonged market correction and the opportunity of a bull-run in the medium to long-term, the need to be a part of INVEST 2019, cannot be over-emphasized.
Our carefully assembled eminent speakers will address the following issues:
Pre-election year performance Review and post-election Investing opportunities –Ms Toyin F. Sanni, Group CEO of Emerging Africa Capital Group, an African provider of integrated financial services covering Advisory and Capital Raising, Trusts, Wealth Management and Investment Facilitation. She was until June 30, 2018, GCEO at United Capital Plc, a leading African investment banking and financial services Group providing capital financing solutions to African governments, companies, and individuals.

A lawyer and Fellow of the Chartered Institute of Stockbrokers, among others, she will discuss how, historically, the factors and policies that have influenced Nigeria’s stock market in an election year, implications for 2019 and how it would drive equity prices higher as recovery expectation continues.
Understanding the big picture of Budget Delays and Implications on the Economy/Stock Market -Alhaji Garba Kurfi, Managing Director of APT Securities & Funds Limited is a Fellow of both the Institute of Chartered Accountants of Nigeria (FCA) and the Chartered Institute of Stockbrokers (FCS). He is also a former council member of the Nigerian Stock Exchange.

Kurfi will address the importance of government’s yearly budget and its role in economic growth; impact of budget delays and implications on the economy; and how the N8.9tr post-election year budget will affect the economy and stock market. He will review the budget implementation style in the past three years, and the impact across board.

Simple Strategies for picking undervalued stocks With Fundamental & Technical Tools-Mr. Abdul-Rasheed Oshoma Momoh, Head, Capital Market, TRW Stockbrokers Limited, a graduate of the Ahmadu Bello University, Zaria; and Fellow Member of the Chartered Institute of Stockbrokers, is a certified Technical Analyst and guru in short term trading techniques.
Participants will learn how to read price actions and chart patterns like the professionals, for a do-it-yourself approach to investing. You will learn notice when professional traders are entering and exiting the market, in that way, you can “shadow” their trades and possibly ask questions! Participants will also learn how to find low priced stocks that are ready to break out; and why some low-priced stocks are better trade candidates than others.

Mastering Market Dynamics & Dividend Techniques For Income Growth in 2019- Mr. Ambrose Omodion, Chief Research Officer, InvestData Consulting Limited, is a Fellow of the Institute of Professional Financial Managers, UK; Associate Member of the Certified Pension Institute of Nigeria and a Certified Financial Manager. He is a South Africa and UK-trained stock market analyst, technician and Convener of Traders & Investors Summit.

A regular guest on Rainbow Fm 94.1 (Friday 2.30pm-3.30pm) and financial market columnist at daily independent newspaper, Omordion will reveal how to take advantage of seasons, patterns and cycles to invest profitably. Participants will also see how market cycles support market reactions to earnings; and how to use earnings calendar, trend, surprises and quality of numbers in making profitable investment decision in 2019 and beyond. He will also take participants through companies with a high to grow dividend payout relative to earnings power and price, and those from which to expect a cut.

Psychology of Equities Trading For Managing Positions & Money –Engr. Ekwueme Mike Anyadibe, Head, Fixed Income Sales at TRW Stockbrokers Limited a ‘seasoned engineer,’ has developed and applied econometric techniques to the Nigerian financial & secondary commodity markets. He has successfully created ‘timing & trend’ models of the Nigerian Stock Exchange, for example, based on technical analysis of ‘Real Nigerian Investors’ Behavior & Sentiments.

Participants will learn how to protect their gains when trading. You will learn early warning signs of when a trend is about to turn against you; know when it’s safe to stay in a trend or jump out; how to see optimal buying points in oversold conditions; and how to creatively manage money and positions to minimize risk

Nigeria’s Post Election Economy & 2019 Sectoral Analysis, Mr.Razaq Abiola, Economist/Head, Investor Relations and Portfolio Investment at United Bank for Africa Plc, is responsible for managing the equity and debt capital of the Group, besides overseeing its private equity investments. As the Group’s Economist, he provides views on the economy of key African markets where UBA operates, with focus on the ALM implications of key macro expectations and events in these economies and sectors.

Abiola will give expectations and outlook for the Economy in 2019 and impact of government policies on sectors in the post-election year to boost industry performance, economy and stock market, looking at the expected reforms that come with new dispensation. Also, he will look at sectors to watch going into 2019 and beyond.

Picking the Right Stocks for Financial Independence and to Retire Rich – Mr. Mike Uzor, Managing Director of Datatrust Consulting Limited is financial analysts and consultant. Holder of Master of Business Administration from Kensington University, California has traversed core areas of the financial market- banking, stock brokerage, pension and marketing communications. His practical knowledge and experience from these equipped him to author How to Buy & Sell Shares in Nigeria, a practical guide.

At the Invest 2019, he will show you how to take advantage of seasons, patterns and cycles to plan for a successful retirement, knowing that some events occur once in two, four and seven years. Participants will also learn criteria for choosing right stocks for retirement in financial freedom; the sectors and how to maximize the opportunity of the current low prices to select right.

As benefits from the Summit, participants will get free Technical Analysis Navigators that combines timing & trend’ models for trading Nigerian Stocks, Forex, Derivative and Commodities. Facilitators will discuss Stocks to Watch, as well as learn the 10 Golden Stocks To Buy in 2019.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
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ambrose.o@investdataonline.com
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Tel: 08028164085, 08032055467
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