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Positive corporate earnings to lift equity trading on NSE

…Analysts list FCMB, as stocks to watch

By Peter Egwuatu

The release of more half year, H1’18 positive corporate results will spike trading on the Nigerian Stock Exchange, NSE this week as equity trading drew to a positive close, finishing 58 bases points, bps higher on Friday majorly supported by Oil & Gas stocks.

Nigerian Stock Exchange
File: Nigerian Stock Exchange NSE

Meanwhile, analysts have listed FCMB Plc which released positive earnings as stock to watch for the week as investors are expected to rally on it.

Analysts at Vetiva Capital Management Limited stated: “Though the market managed a positive performance at week close, we believe the outcome of earnings releases will remain the major determinant of market direction in this week. That said, we foresee a mildly positive start to the week, noting the widely positive market breath at week close.

“FCMB is a stock top watch as it released its first half, H1’18 results earlier today, Friday. The company recorded an 8 percent Year on Year, YoY rise in Gross earnings, in line with Vetiva estimate, and a 90 percent YoY increase in Profit After Tax, PAT, 19 percent below Vetiva estimates. The stock gained 355bps on Friday to settle at N2.04 , a 38 percent Year to Date, YtD return.”

Meanwhile, analysis of market performance showed that the All Share Index however recorded a modest 9 bps Week on Week, WoW rise amidst notable losses recorded at mid-week.  The NSE All-Share Index and market Capitalisation appreciated by 0.09 percent to close the week at 36,636.97 and N13.272 trillion respectively. Similarly, all other indices finished higher with the exception of the NSE Premium, NSE Consumer Goods, NSE Oil/Gas, NSE Industrial Goods, NSE Pension Indices that depreciated by 0.16 percent, 0.19 percent, 3.74 percent , 4.40 percent and 0.56 percent respectively.

Thirty-one (31) equities appreciated in price last week, higher than sixteen (16) in the penultimate week. Forty-eight (48) equities depreciated in price, lower than fifty-nine (59) equities of the penultimate week, while ninety (90) equities remained unchanged lower than ninety-four (94) equities recorded in the penultimate week.

A total turnover of 1.417 billion shares worth N16.739 billion in 19,832 deals were traded last week by investors on the floor of the Exchange in contrast to a total of 1.665 billion shares valued at N14.834 billion that exchanged hands last week in 18,795 deals. The Financial Services Industry (measured by volume) led the activity chart with 832.842 million shares valued at N8.823 billion traded in 10,851 deals; thus contributing 58.76 percent and 52.71 percent to the total equity turnover volume and value respectively.

Vetiva Capital drew to a positive close, finishing 58bps higher on Friday majorly supported by Oil & Gas stocks. The All-Share Index however recorded a modest 9bps w/w rise amidst notable losses recorded at mid-week. The Banking sector (+78bps; +197bps w/w) had the strongest performance amongst key sectors with GUARANTY (+154bps) and FCMB (+355bps) boosting the sector. The Consumer Goods sector also recorded a positive close to the week (+105bps), thanks to advances in DANGSUGAR (+10.00%) and DANGFLOUR (+970bps). However, stronger losses early in the week led the sector – 19bps lower w/w. Meanwhile, the Industrial Goods (+43bps d/d; -440bps w/w) and Oil & Gas (-76bps d/d; -374bps w/w) sectors were the worst performing counters this week, following weighty losses in WAPCO (- 15.38% w/w) and OANDO (-5.41% w/w) respectively. • Though the market managed a positive performance at week close, we believe the outcome of earnings releases will remain the major determinant of market direction in the coming week. That said, we foresee a mildly positive start to the week, noting the widely positive market breath at week close. • Stock Watch: FCMB released its H1’18 results earlier today. The company recorded an 8% y/y rise in Gross earnings, in line with Vetiva estimate, and a 90% y/y increase in PAT, 19% below Vetiva estimates. The stock gained 355bps on Friday to settle at N2.04 – a 38% ytd return.

NSE

A total turnover of 1.417 billion shares worth N16.739 billion in 19,832 deals were traded this week by investors on the floor of the Exchange in contrast to a total of 1.665 billion shares valued at N14.834 billion that exchanged hands last week in 18,795 deals. The Financial Services Industry (measured by volume) led the activity chart with 832.842 million shares valued at N8.823 billion traded in 10,851 deals; thus contributing 58.76% and 52.71% to the total equity turnover volume and value respectively. The Services Industry followed with 320.350 million shares worth N679.981 million in 584 deals. The third place was occupied by Conglomerates Industry with a turnover of 99.403 million shares worth N147.372 million in 1,000 deals. Trading in the Top Three Equities namely – Medview Airline Plc, FBN Holdings Plc and Zenith International Bank Plc (measured by volume) accounted for 578.789 million shares worth N5.153 billion in 2,874 deals, contributing 40.83% and 30.78% to the total equity turnover volume and value respectively.

The NSE All-Share Index and Market Capitalization appreciated by 0.09% to close the week at 36,636.97 and N13.272 trillion respectively. Similarly, all other indices finished higher with the exception of the NSE Premium, NSE Consumer Goods, NSE Oil/Gas, NSE Industrial Goods, NSE Pension Indices that depreciated by 0.16%, 0.19%, 3.74%, 4.40% and 0.56%. (

Thirty-one (31) equities appreciated in price during the week, higher than sixteen (16) in the previous week. Forty-eight (48) equities depreciated in price, lower than fifty-nine (59) equities of the previous week, while ninety (90) equities remained unchanged lower than ninety-four (94) equities recorded in the preceding week.


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Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.