Monday, 3 June 2013

Market Gains N3.11tn in 5 Months as Demand Lifts Access, GTBank

Trading-session-in-NSE-2105.jpg - Trading-session-in-NSE-2105.jpg
Trading session in NSE
The Nigerian equities market witnessed significant gains last week, closing the five months with a growth of N3.11 trillion. The growth in market capitalisation was 34.6 per cent and represented a significant improvement over the N674 billion or 11 per cent recorded in the corresponding period of 2012.

 An analysis of the market performance in the last five months showed that the Nigerian Stock Exchange (NSE) capitalisation rose from N8.97 trillion to close at N12.08 trillion. About N141 billion gains was recorded last week as institutional investors took position in stocks with half year dividend history. Chiefly among them were GTBank Plc and Access Bank Plc. The two stocks witnessed tremendous price appreciations.

Known for its good corporate governance practice, GTBank, enjoyed impressive buy action from the foreign investors. The high demand for Access Bank and GTBank ahead of the release of their half year unaudited results sustained their recent gain momentum. Access Bank has gained 20.3 per cent in the last five months closing at N11.20 while GTBank has recorded a gain of 15.9 per cent in the same period. Analysts believe the stocks may witness further price rally as investors continue to take positions.

Another factor that influenced the direction of the market last week was investors’ appetite for big capped stocks in the consumer goods sector including Dangote Cement. Other key drivers of the performance included Nestle Nigeria Plc, which crossed the N1, 000.00 per share price level with a N98.00 per share gain last Thursday; Total Nigeria Plc; Nigerian Breweries Plc and Flourmills Nigeria Plc.

 Experts believed the non-bank component of the market performance indicated increased investors’ confidence in the economy as the country celebrates 14 years of democratic governance.

The market had the previous week sustained its positive momentum following strong market sentiment- one of the major drivers was Cadbury Nigeria Plc, which had a fantastic week. The stock, which opened the trading week at N44.50 per share closed the week at N64.53 as the stock enjoyed huge buy interests in the week. The market started the week on a good note last Monday as stock prices grew further amidst short price volatilities, sustaining the gaining streak of previous trading week as investors and securities traders show buy interests for the high capped stocks. The market, however, turned to a different direction on Tuesday as it went down by 0.07 per cent, snapping the gains of previous trading days as speculative investors took profits on winning stocks. The market was unable to sustain its breadth as the mild sell pressures overwhelmed trading activities. All the NSE sector indices trended downward except the insurance sector index, which witnessed an uptick. The market opened for four days last week due to as the federal government of Nigeria declaration of Wednesday May 29, 2013 a public holiday to mark the democracy day celebrations. On Thursday, the stock market gained significantly in a post democracy day holiday recovery that saw market non-bank blue chips driving a surge that pushed market capitalisation above the N12 trillion levels and the index above the 38,000 mark. However, stock prices fell on again on Friday, eroding the gains of previous trading days as speculative investors took profits on winning stocks.

Index Movement
As a result, the NSE All-Share Index or ASI appreciated by 1.19 per cent to close on Friday at 37,794.75 while the market capitalisation on the mainboard advanced by 1.14per cent to close at N12.075 trillion. Also, the NSE 30 Index appreciated by 1.05per cent to close at 1,809.91.
All except one of the NSE sectoral indices appreciated same as the preceding week: NSE Consumer Goods, NSE Banking, NSE Insurance Index, NSE Oil/Gas, NSE-Lotus II and NSE Industrial Goods Indices advanced by 0.66per cent, 0.19per cent, 1.17per cent, 0.58per cent, 0.62per cent, and 1.68per cent. However, NSE-ASeM Index depreciated by 0.95per cent.

Market Turnover
A review of the trading numbers for the week showed that 1.503 billion shares valued at N14.109 billion in were traded in 24,007 compared with 2.120 billion shares valued at N25.676 billion that exchanged hands the previous week in 31,806 deals. The Financial Services sector (measured by volume) led the activity chart with a turnover of 1.070 billion shares valued at N7.844 billion traded in 12,406 deals. The Financial Services sector represented 71.65 per cent and 55.60 per cent of the total traded volume and value respectively.

The banking subsector of the Financial Services sector boosted by activity in the shares of Unity Bank Plc and U B A Plc was the most active subsector on the week’s activity chart with subsector turnover of 811.929 million shares valued at N6.059 billion exchanged hands by investors in 8,834 deals. Also, the banking subsector accounted for 54.02 per cent and 42.95 per cent of the total subsector traded volume and value respectively. Traded during the week were 52 units of NewGold Exchange Traded Funds (ETFs) valued at N111, 579 executed in 3 deals compared with a total 44 units valued at N93, 588 transacted last week in 4 deals.
Also, 300 units of FGN bonds valued at N33, 242 were traded during the week in 3 deals in contrast to 1,300 units valued at N148, 039 transacted last week in 13 deals.

Gainers and Losers
The price movement chart of the NSE displayed a total of 40 equities that appreciated in prices during the week lower than 44 equities of the preceding week. Thirty-six equities depreciated in prices lower than 46 equities of the preceding week, while 119 equities remained constant higher than 105 equities of the preceding week. The top 10 gainers were: Union Bank Nigeria Plc. (N2.08), Mcnichols Plc (54 kobo), Neimeth International Pharmaceuticals Plc (20 kobo), Ikeja Hotel Plc (15 kobo), Livestock Feeds Plc (68 kobo), IPWA Plc (12 kobo), Evans Medicals Plc (50 kobo), UTC Nigeria Plc (13 kobo), Jos International Breweries Plc (17 kobo) and Champion Breweries Plc (44 kobo). Conversely, the top 10 losers were: CAP Plc (N17.51 ), UACN Plc (N12.50), National Salt Company Nigeria Plc (N2.20), Cadbury Nigeria Plc (N9.04), SIM Capital Alliance Value Fund (N7.59), International Breweries Plc (N1.72), BOC Gases Plc (83 kobo), Skye Bank Plc (32 kobo), Eterna Plc (19 kobo), and UACN Property Development Company Plc (82 kobo).

NASD Goes Live June
Last week indications emerged that the NASD Limited, which is approved by the Securities and Exchange Commission (SEC) to operate an over-the-counter (OTC) market for the trading of unlisted securities will now go live in July.

 The company had planned to go live this month but had to shift the date as it awaits the approval of its updated set of rules by SEC. Managing Director of NASD Limited, Mr. Bola Ajomale, had told THISDAY that the firm had resent an updated set of rules to SEC and was expecting response soon.

“We are going live in May and the excitement in the market is great because the NASD platform will complement the activities of the NSE and make the capital market for robust and attractive,” he had said.

But a reliable source close to NASD Limited said the commencement date is now July.
“We have made progress and the official launch date is July. We had to wait for the final approvals from SEC. We have started test running and this will go on for a while before the launch,” the source said.

 Ajomale had disclosed that 10 companies had indicated interest to have their shares traded on the NASD Limited, saying directors and shareholders of unlisted companies were very excited to trade their shares on the platform.
Source: ThisDayLive

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