By Peter Egwuatu
In spite of profit taking and the holi day induced reduction to three days trading sessions equities market investors gained N354.26 billion on the Nigerian Exchange Limited, NGX last week as market capitalisation rose to N28.157 trillion from N27.803 trillion the previous week.
However, analysts predicted mixed sentiments for this week as they cautioned investors to go for low priced and fundamental blue chip stocks given uncertainty in the economy due to build up of political tension in the country.
Also reflecting the bullish performance of the market last week, the All-Share Index, ASI, another stock market gauge, increased by 1.28% to close at 52215.12 points from 51.557.41 points.
Meanwhile, the year-to-date return rose to 22.24%. However, the sectorial gauges’ performance ended bearish except for the NGX Oil and Gas Index which gained 0.02% Week on week, W/W.
On the flip side, there were declines in NGX Banking (0.52%), trailed by NGX Insurance (1.89%) while the NGX Consumer Goods Index and NGX Industrial Index reported losses by 0.30% and 3.38% on a W/W comparison.
Elsewhere, bearish sentiments pervaded the level of trading activity during the week as total traded volume and value decreased by 38.68% and 27.48% W/W respectively to 504.42 million units valued at N7.52 billion.
Commenting, analysts at Cowry Asset Management Limited, said:”In the new week, we expect the market to trade in a mixed sentiment as its heads for a breather while investors continue their profit-taking activities ahead of the earning season. Also, we continue to advise investors to trade on companies’ stocks with sound fundamentals and a positive outlook.”
Analysts at Cordros Research stated:” We expect investors to trade cautiously in the week ahead as they anticipate the H1-22 earnings season. Notwithstanding, we reiterate the need for positioning in only fundamentally sound stocks as the weak macro environment remains a significant headwind for corporate earnings.”
Analysts at Afrinvest Securties Limited said: “This week we anticipate a mixed sentiment albeit negatively tilt.”
While analysts at InvestData Consulting Limited said:”The new market environment of rising inflation and interest rates calls for new trading and investing strategies, as factors that kept the market in its oscillating trend remain unchanged. This is happening amidst the expectation of interim dividend-paying corporate earnings, and others will be game-changers as we go further into the quarter with increasing political activities ahead of the 2023 general elections and the ongoing war between Russia and Ukraine.”