Amidst Weakening Indicators, Investors Look To Q1 Portfolio Realignments, Earnings Deadline

Market Update for March 27
At the end of midweek’s trading session on the Nigerian Stock Exchange, the composite index slumped further on heightened cautious trading and indecision among market players as they interpreted the impact of the cut in Monetary Policy Rate by the Central Bank of Nigeria (CBN) on the economy and circular flow of funds. This, they seem to bd considering vis-a-vis Ngeria’s political correctness with the cnclusion of its 2019 general elections (a second supplementary election holds Thursday in Adamawa, home state of main opposition presidential candidate- Atiku Abubakar). All eyes are on government’s economy policy to see whether there are is any plan to stimulate its growth again in the new dispensation after had dragging feet in the last four years. Analysts however say the CBN rate cut may not achieve the desired result, given the magnitude of the bottlenecks the economy must grapple with (READ).

Investdata believes the rate cut can yet boost Nigeria economy, if the CBN ensures that banks reflect it in their transactions and make funds available at a relative cost. We expect that to encourage lending again, as well as engender an active and productivity economy, even if it could mean a reduced inflow of foreign investments. It would stimulate businesses and impact corporate performance positively in the medium to long-term. This will consequently support equity price on the Exchange when numbers produced by listed companies start to trend up.

We therefore believe that there is no cause for panic yet and advice investors to focus rather on fundamentally sound stocks that are liquid and dividend payout is high.
Also, we expect the prevailing high dividend yield in the equity segment of the financial market to attract funds as time goes on.

Trading for Thursday started on a slightly up movement in the morning session, before pulling back between mid-morning and afternoon, as selloffs hit high cap stocks, before retracing up marginally in the late afternoon.
However, this was after the index had broken down the psychological line of 31,000 mark to touch intraday low of 30,811.14 basis points from its high of 31,066.07 points to close the session lower at 30,829.45 to test a new support level.

Market technicals for day were negative and weak as volume traded remained lower than previous day’s in the midst of negative breadth and sentiment, as revealed by Investdata’s Daily Sentiment Report, showing sell volume of 93% and buy position at 7% on total daily transaction volume index at 0.46.
Energy behind the day’s market performance were weak, but marginally up as shown by money flow index at 13.64 points, from previous day’s 13.22bps. This indicates that funds entered some stocks and the market irrespective of the selloff.

Index and Market Cap
The NSE All Share index NSEASI at the end of Wednesday transaction lost 209.41bps to close at 30,829.45bps, from 31,038.86bps, representing a 0.67% decline; while market capitalization shed N78.74bn to close at N11.59tr from its opening value of N11.67tr, representing a 0.67% value loss.
Attention: Join Investdata buy and sell signal setup to get all our in-depths analysis on the picture and to get access to our carefully created watch list. To become a member, send ‘YES’ or ‘STOCKS’ to the phone numbers below. The number of stocks on our watchlist has increased due to the prolonged market correction. Take advantage of this service to buy right and sell right during this earnings season and beyond.

Midweek’s downturn was due to continued selloffs in medium and high cap stocks like Seplat, Stanbic IBTC, PZ, Guaranty Trust Bank, UBA, FBN Holdings, Flourmills, Dangote Flour. This impacted on Year-to-Date loss, extending it to 1.97%, while market capitalization dropped by N29.16bn, or 0.25%, from the year’s opening level of N11.72tr.

Bearish Sector Indices
All sectoral performance indexes were in red, except for the NSE Industrial Goods that was up marginally by 0.03%. Just as, market breadth was negative with decliners outweighing advancers in the ratio of 19:11.
Market activities in volume and value were down by 8.54% and 16.58% respectively to 131.43m shares worth N1.4bn, from previous day’s 143.71m units valued at N1.68bn. Volume was driven by financial services stocks like: Zenith Bank, Access Bank, FCMB, UBA and Sterling Bank.

The best performing stocks for the session were Union Diagnostic and Cutix which chalked 10% and 9.73% gains respectively to close at N0.33 and N2.03 per share on market forces. On the other hand, NEM Insurance and Stanbic IBTC lost 5.50% and 5.15% respectively, closing at N2.22 and N46.00 each, on profit taking and market forces.

Market Outlook
We expect a marginally up market Thursday, on end of the month and quarter window dressing by fund managers and stockbrokers as they balance their trading account for the period. Also, there is hopeof more earnings reports pouring in as the March 31, 2019 official deadline for companies with December 31, 2018 year-end earnings reporting season draws to a close on Friday. We note also that notification of close period for first quarter 2019 earnings reports has started.
Investors look to government’s policy direction as the market faces low liquidity problems in the ongoing earnings reporting season, vis-à-vis market and economic fundamentals.

Given the drop in the prices of major blue chips in recent times, creating entry opportunities, we expect speculative trading to shape the market direction going forward.
The volatility witnessed last week, was driven by traders and investors repositioning ahead of dividend declaration by major listed companies.
The ongoing volatility will continued as investors and fund managers rebalance their portfolios, with eyes fixed on political space and ongoing full year company earnings position and post-election market dynamics. Investors should review their positions in line with their investment goals, strength of the company numbers and act as events unfold in the global and domestic environment.

However, we would like to reiterate our advice that investors should go for equities with intrinsic value,
We advice investors to allow numbers guide their decisions while repositioning in any stock, especially now that stock prices remain low in the midst of mixed company numbers, weak economic and market fundamentals.
Meanwhile, we greatly appreciate participants in the Abuja Invest 2019 Post-Election Bulls & Bears held on Saturday, March 23.

The investment education train moves to Port-Harcourt, Rivers State, with Chart Summit 2019!
Attend the Practical Conference on Technical Analysis Application on stock market for novices and Advance Traders, where we would take participants through:
• Understanding the momentum behind current equity movements and when to exit using SIMPLE Technical Indicators and Tools to avoid losing capital and profit.
• Understanding the dynamics of Technical Analysis and its application in stock, currency and bond markets.
• 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 Personal Computer.
• Know what Smart Money is doing
• Know what they are buying or selling, and
• How you can buy what they are buying.

The workshop is scheduled as follows
FEE: 10.000
DATE: April 13. 2019
TIME: 10am – 4.00pm
VENUE:Emerald Hotel, 193, Aba Road Rumuola, Port Harcourt, Rivers State.

This Summit is designed specifically for those who:
• Jump off profit position out of fear
• Suffer indecision in pulling the trigger for fear of sustaining a loss
• Holding on to losing positionsfor fear of realizing a potential loss
• Trading often leads into unplanned trades for fear leaving money on the table
• Do small trade size or invest small amounts because you’ve just suffered huge loss, or
• Plan to increase your position size to 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 practical charting on evidence-based techniques that is working in today market, just as the power of focused trading and investing strategiesto help participants build mental skills and turn fear into profits, besides protecting capital.

Registration is ongoing
Prepare yourself to profit from the market, as the economy recovers in the months ahead, while truly achieving financial independence and freedom in 2019 and beyond. There will be Home Study Packs you can play and view on your phone, laptop and television sets that will teach, among others: Stock trading/investing, Fundamental/Technical Analysis on sale at the venue. All at 20% discount for participants.
Also, Come With Your Laptop for the practical sessions.

TAKE ACTION
The difference between you and others who are not aware of what I am sharing with you is ACTION. Take action that will transform your life throughout 2019 and beyond by getting the just concluded and life transforming INVEST 2019 TRADERS & INVESTORS SUCCESS SUMMIT Home study pack (USB) that you can play on your phone, Laptop and Television set. The event, which held on Saturday, December 8, 2018, was yet another successful, insightful and educative outing that not only offered direction as to where investors should look for a profitable trade in 2019, insight into industries, sectors and companies to seek worthwhile returns. What stocks should you buy? Grab the pack for the 10 Golden Stocks with possibility of offering in 2019 multiples of what broader stocks do, coming out of this market correction environment.
Don’t sit on the Fence call or text Stock to 08028164085, 08032055467, 08111811223 now.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467
https://investdata.com.ng/2019/03/amidst-weakening-indicators-investors-look-to-q1-portfolio-realignments-earnings-deadline/