By Peter Egwuatu

Bullish trend has dominated the Nigerian stock market against the backdrop of the Gross Domestic Product, GDP, a report which indicated a 2.51% growth in the second quarter of 2023, Q2’23, a significant drag below both the first quarter figure and analysts’ projections.

The Nigerian Exchange Limited, NGX, All-Share Index, ASI, advanced by 1.3% Week-on-Week, WoW, to close at 65,558.91 points, driven by investors’ interest in BUA Foods which rose by 7.9%, Dangote Sugar 35.7% and Transcorp 39.4%.

As a result, the Month-to-Date, MtD, and Year-to-Date, YtD, gains increased to 0.6% and 26.3%, respectively.

On the activity levels, total trading volume increased by 7.3% WoW while the trading value declined by 0.4% WoW.

From a sectoral review, the Consumer Goods Index went up 11.6% and Insurance Index 1.20 %, while the Banking Index declined by -3.6%, and Oil and Gas Index -2.4%. The Industrial Goods Index closed flat.

Commenting on market outlook, analysts at Cordros Research said: “Looking ahead, we expect investors’ sentiments to be influenced by developments in the macroeconomic landscape and the movement of yields in the fixed-income market. Overall, we reiterate the need for positioning in only fundamentally sound stocks as the weak macro environment remains a significant headwind for corporate earnings.”

Also analysts at Cowry Asset Management Limited said: “The prevailing trend of buoyant sentiment is expected to persist, supported by the ongoing digestion of robust economic data spotlighting Nigeria’s commendable output performance and positive trajectory.

”Nevertheless, the continued market response to elevated T-bill rates, juxtaposed with renewed interest in bargain opportunities and portfolio realignments, remains a focal point. Meanwhile, we continue to advise investors to take positions in stocks with sound fundamentals.”

Commenting as well, analysts at InvestData Consulting said: “We expect mixed sentiment as market reacts to high Treasury bill rates and hyperinflationary environment of 24.1% rate in the midst of bargain hunting and portfolio repositioning ahead of first-tier banks earnings reports expectation and sector rotation persists.”