Stock Market: Corporate revenue; new policies strengthen upward trend — Analysts.

The upward trend in the stock market will persist this week driven by corporate earnings releases and new policy pronouncements by the Federal Government, Analysts said in their projections for this week. 

Meanwhile, trading on the Nigerian Exchange Limited, NGX, last week shut down marginally positive despite pressure from profit-taking activities during the week.

Specifically, the NGX All Share Index, ASI rose by 0.08% Week on Week, w/w to shut down at 65,056.39 points from 65,003.39 points the previous week.

Another stock market gauge, market capitalization surged marginally by N8 billion, w/w, to close at N35.402 trillion from N35.394 trillion the previous week.

Precisely, SEPLAT gained 21.0% and STANBIC IBTC 10.9% to lead the gainers chart. The sell-offs of Nigerian Breweries, NB led to the drop in its price by 19.0% followed by First Bank Nigeria Holdings, FBNH 6.6%. Based on the preceding, the Year-to-Date progressed to 6.7%. 

On the other hand, activity levels wavered as the trading volume and value declined by 31.7% w/w and 62.0% w/w, respectively. Sectoral performance was broadly negative following losses recorded by the Consumer Goods Index 2.4%, Banking Index 2.2%, Insurance Index 1.6%, and Industrial Goods Index 0.3%. On the flip side, the Oil and Gas Index gained 1.4% to be the sole gainer of the week.

Reacting to the market outlook, analysts at Cordros Research said:” In the coming week, we expect a flurry of earnings releases on NGX’s floor as more companies publish their half-year numbers. Against the preceding, we think positive earnings surprises and possible interim dividend declarations from companies would spur increased bargain-hunting activities on the bourse. Nevertheless, we do not rule out the possibility of profit-taking activities on tickers that have experienced substantial appreciation. In the medium term, we expect investors’ sentiments to be influenced by developments in the macroeconomic landscape and the movement of yields in the fixed-income

Similarly, analysts at Cordros Research, said:” We expect mixed sentiments to continue as market players digest the corporate earnings, changing economic fundamentals and concerns, with the ministerial list released, the expectation of more earnings inflow. There is also the hope for more policy pronouncements and appointments that would offer investment direction.

Also, more Q2 earnings reports are expected to confirm the real state of the company performances and attract liquidity amid markdown dates and the release of remaining audited accounts.”

Edited by Damilola Adeleke

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