Analysts at Bancorp Securities Limited on Tuesday projected that trading in the nation’s stock exchange will not be upbeat this week as investors continue to react to the monetary policy rate (MPR) hike by the monetary authorities last week.
The investment experts in the firm’s ‘Weekly Stock Recommendations: Oct 4- Oct 7’ predicted: “We expect the market to sustain its current trend as investors continue to trade cautiously as fixed income rates continue to be appealing to investors in the near term.”
Despite the forecast, the investment analysts still recommended WAPCO, MTNN, ZENITH and GTCO as strong buy for investors this week.
Specifically, on ZENITH the investment researchers stated: “We maintain a Buy recommendation on the stock with a target price target of N30.00 on the back of the decent H1 2022 results: stable asset quality; capital adequacy (CAR 21.0%) and sustainable long-term dividend policy.”
The analysts recalled that the Monetary Policy Committee (MPC) raised the MPR by 150bps to 15.50% from 14% in a bid to quell the accelerating inflation whilst also attracting foreign inflows to the economy.
According to the analysts, the monetary policy decision by the committee triggered reactions from investors who exhibited lukewarm attitude in the trading sessions last week, thereby dipping the All Share Index (ASI) by a marginal 0.01% w/w to 49,024 points while YTD return settled at 14.77%.
In spite of the cautious disposition of investors, the market capitalization gained N6.85bn w/w to N26.45tn on the back of price appreciation witnessed in MULTIVERSE (+31%), NGXGROUP (+18%), JAIZBANK (+15%), BUACEMENT (+9%) and ETERNA (+10%).
Similarly, the market’s total volume grew by 80.36% w/w to 1.01bn units and total value traded rose by 6.36% to N10.04bn. The sectorial performance ended in a varied position as the Industrial Goods (+3.01%) and the Oil & Gas Index (+0.20%) recorded gain w/w due to price upticks in BUACEMENT, ETERNA and ARDOVA.
Conversely, the Consumer Goods Indexes (-3.37%) led the laggards as NESTLE, VITAFOAM and UNILEVER recorded losses w/w, followed by Insurance and Banking which declined by -3.25% and -0.89% w/w respectively.
