Going the way of last week, the Nigerian stock market is expected to continue on weak performance.
Analysts at Afrinvest Limited stated that “In the absence of positive catalysts, we expect the weak performance to persist this week.”
Also, analysts at Cordros Securities Limited said that “In the week ahead, we anticipate cautious trading in the bourse following the Monetary Policy Committee (MPC) meeting scheduled for next week. Notwithstanding, we advise investors to take positions in only fundamentally justified stocks as the weak macro story remains a significant headwind for corporate earnings.”
In the new week, Cowry Assets Management Limited expected the equities market index to close in negative territory as investors remain cautiously optimistic amid rising rates in the fixed income space and the depreciating naira against the dollar.
On market outlook for the week, the chief operating officer of InvestData Consulting Limited, Mr Ambrose Omordion said that “We expect the mixed trend to continue as investors and traders utilizes the market’s sideways trending to position, while many stocks are trading within their buy ranges, a situation expected to attract funds into the equity space given the dividend yields capable of serving as a hedge against inflation.”
He also said, institutional investors and others will continue to digest the second quarter (Q2) GDP growth ahead of more first-tier bank results, as well as the continued repositioning of portfolios for the year’s last quarter.
“Also, investors are still observing the interplay of forces in the FX market as the CBN gives a guideline for the new digital currency platform. Last week’s low volume suggests that institutional investors and others are still cautiously looking at the numbers. It is noteworthy that oil prices rebounded in the international market; corporate actions, as well as the interim dividend possibilities, are around the corner.”
Last week, the bearish sentiment trailed the domestic stock market amid mixed financial performance released by Banks. Specifically, Guaranty Trust Holding Company (GTCO) printed 15.76 per cent decline in profit after tax, while United Bank for Africa (UBA) recorded 36.35 per cent increase in net profit. The relatively weak financial performance by GTCO rubbed-off on the equities market, hence, the All-Share Index (ASI) declined week-on-week (W-o-W) by 339.23 points or 0.86 per cent to close at 38,921.78 points. Similarly, market capitalisation fell N177 billion W-o-W to close at N20.279 trillion. Consequently, the month-to-date (MTD) and year-to-date (YTD) losses increased to 0.8 per cent and 3.3 […]