By Peter Egwuatu
THERE are indications that mixed sentiments will trail transactions on the Nigerian Stock Exchange, NSE, this week as financial analysts’ predictions about the market differs following a huge decline in market index last week.
Analysts at Cordros Capital, a Lagos based investment house said: “Despite persisting loses, it is our view that legroom for gains still exist in the long term, as risky assets remain favourably priced, amid still supportive macroeconomic fundamentals.”
Vetiva Capital Management in its market reaction stated: “Sentiment last week was largely bearish, characterized by huge losses in select large caps. Though there is still some room for further losses, we foresee bargain hunting at week open as investors take position on depressed stocks.”
Cowry Asset Management in its reaction said: “This week, we expect the local bourse to close flat in the green territory as investors take advantage of the low prices of some fundamentally sound stocks amid expected better half year results.”
Analysis of the market performance showed that despite the signing of the expansionary budget of N9.12 trillion by President Muhammadu Buhari, investor sentiment in the nation’s stock market last week was negative as the NSE All Share Index declined significantly by 2.74% to close at 38,152.60 bases points, bpts.
The Year-to-Date, YtD, return consequently settled in the negative at -1.00%, with the volume of trades declining by 30.36% while the value of transactions increased by 7%.
Market operators explained that the mood in the market was bearish given the sell-offs across many sectors in the market. The market performance was dragged particularly by losses recorded on the heavily weighted companies in the industrial goods and oil and gas sectors.
The Oil & Gas index recorded the most loss by -5.94% owing to significant sell pressures in SEPLAT shares. The Industrial Goods index dropped by -3.39% , Banking index declined by -1.96% , and Consumer Goods index dropped by 0.50% while the Insurance index closed positive at +3.39%. Notably, JAPAUL OIL remained the best performing stock for the third consecutive week, and remains the best performing in the month so far with a staggering 123.81% Month to Date, MtD return.