Investment analysts at Bancorp Securities Limited, a leading investment research and consulting services firm, have predicted that trading sentiments in the Nigerian Exchange (NGX) this week will be mixed as fiscal and macroeconomic policy measures of the new administration will affect investor sentiment.
The experts, in the firm’s ‘Weekly Stock Recommendations Jul 10 – Jul 14, 2023’ circulated to our correspondent, advised investors to be savvy in their investment decisions on stocks by trading on stocks that have good fundamentals in view of the prevailing fiscal and macroeconomic trends in the investment space.
While recommending only NESTLE for buy this, the analysts urged investors to hold investment decisions on other blue chip stocks and others as well as to sell many others including ZENITH, FLOURMILL, CUSTODIAN, FCMB, OKOMUOIL, GTCO, ACCESSCORP, PRESCO, UBA, FIDELITY, FIDSON and many others.
The analysts projected: “This week, we expect the markets to sustain it bullish momentum as we continue to evaluate its most recent frontiers.
“We are of the opinion that this bullish momentum in the Nigerian bourse will continue at alternating rates, as a fiscal policies and macroeconomic growth continue to align at the very least in the medium term.
“We however advice investors to trade on stocks that have good fundamentals in line with their respective tenured investment objectives”, the Bancorp Securities’ experts added.
They recalled that last week, the Nigerian bourse sustained its month-long bullish momentum, with the NGXASI gained 3.40% on a WoW basis, noting that intra-week trading during the week remains unusually high when measured by volume and by value which increased significantly by 191.81% and 246.50% respectively to print at 9.83 billion shares traded valued at N145.86 billion.
The experts reported: “Interestingly, although not surprisingly is the reported ‘tussle’ for FBNH shareholdings which saw the stock gain 19.06% on a WoW basis, wherein an excess of 4.93 billion of its floated shares were traded during the week, with 4.69 billion shares traded on Thursday, July 6, 2023 only.
“The above statistics makes implies that the exchange of FBNH shares accounted of about 49.7% of total volume traded during the past week. The acquisitions were reportedly carried by Barbican Capital Limited, thereby making it a 13.3% stakeholder in Firstbank Holding Company (FBNH).
“The market at large may be perceived to be creating new frontier as the NGXASI continues to rally beyond the 60,000 points mark.
“The indexes under our coverage all closed bullish, except for the consumer goods index that returned a negative 0.22%, noteworthy of mention and significantly also is the respective year-to-date returns of these indices, which have all exceeded the current rate of inflation in Nigeria which last printed at 22.41%. UNITYBNK and FCMB end of week premiums of 37.29% and 30.39% respectively and amongst others accounted for the 9.82% growth Banking index.
“The bullish run on the Oil & Gas sector is justifiably forward looking causing the index to return 7.18% gain at the end of the previous week, as JAPAULGOLD and ETERNA, led the sectors gains with 58.57% and 35.24% returns respectively. Industrial goods sector which can be considered to be a parallel to the macroeconomy’s GDP improved by 2.22% at the end of the week, as investors picked interests in BERGER, MEYER and DANGCEM to cause a rally that saw its respective prices gain 10.00%, 10.00% and 5.30%.
“Profit taking and portfolio divestments characterized the volume of trades in the Insurance subsector as its index returned 0.73% wherein CHIPLC and UNIVINSURE led the sectors gainers chart with 57.32% and 28.57% returns”, the analysts added.
