FeaturedMarket Update

Nigerian Equities Market Update-30/05/18: Bearish Trend, Possible Cause & Right Investment Approach

Completing nine (9) straight bearish days, equities trading on the floor of The Nigerian Stock Exchange slipped further into the negative territory. Total point shed through today’s trading activities was 108Bpts. Save NSE-Insurance and NSE-Oil & Gas that gained, other observed market indices slide. Week to Date, the lead performance index is down by 182Bpts while total lost in the month of May is now 645Bpts. See the index movement table for details.

Value loss by the market capitalization of the listed equities during today’s trading activities was N152.897 billion, same as 108Bpts below the opening value.  Meanwhile, trading activities for the day produced 23 advancers and 25 lagers. NSEASI Year to Date gain is now 0.95% while the Market Capitalization Year to Date gain stood at N374.927 billion same as 2.75% above the year’s opening value.

Aside the recent reported slight fluctuations in the nation’s reserve, all economic indicators have maintained positive outlook. Nevertheless, due to few external factors, leading from the termination of the U.S. nuclear deal with Iran, the “destruction” of the transatlantic alliance between the EU and the U.S, and increased U.S. Fed rates, increasing capital flight was induced in most emerging market of which Nigeria is not fully insulated. Recall that before now, we reported that the U.S. Policymakers also confirmed plan to increase rates twice this year, while raising the forecast for rate hikes in 2019. The United States Federal Reserve said it had decided to raise the rate by 0.25% to a target range of 1.5% -1.75%.

Confirming the reality of increasing Fx outflows as against inflows is the strengthening dollar against the naira. In reaction to these, the CBN were seen coming tough on both Banks and BDC operators in other to ensure compliance with its Fx sale policies. The above factors notwithstanding, the upcoming election remains a major internal factor negatively impacting investment decisions in the nation’s capital market. Most traders maintained negative side as the politicking towards the election heightened.

Please understand that, despite the dwindling prices of listed equities, corporate earnings remained intact. The implication is that, earnings yield will improve in the coming half year earnings season, as equities become cheaper and accessible. We are of the opinion that taking advantage of dropping prices against fundamentals remains intelligent investment decision. As fondly noted in our reports, equities with half year incentive policy should top in traders trading baskets. Safe Trade.

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FeaturedMarket Update

Nigerian Equities Market Update-30/05/18: Bearish Trend, Possible Cause & Right Investment Approach

Completing nine (9) straight bearish days, equities trading on the floor of The Nigerian Stock Exchange slipped further into the negative territory. Total point shed through today’s trading activities was 108Bpts. Save NSE-Insurance and NSE-Oil & Gas that gained, other observed market indices slide. Week to Date, the lead performance index is down by 182Bpts while total lost in the month of May is now 645Bpts. See the index movement table for details.

Value loss by the market capitalization of the listed equities during today’s trading activities was N152.897 billion, same as 108Bpts below the opening value.  Meanwhile, trading activities for the day produced 23 advancers and 25 lagers. NSEASI Year to Date gain is now 0.95% while the Market Capitalization Year to Date gain stood at N374.927 billion same as 2.75% above the year’s opening value.

Aside the recent reported slight fluctuations in the nation’s reserve, all economic indicators have maintained positive outlook. Nevertheless, due to few external factors, leading from the termination of the U.S. nuclear deal with Iran, the “destruction” of the transatlantic alliance between the EU and the U.S, and increased U.S. Fed rates, increasing capital flight was induced in most emerging market of which Nigeria is not fully insulated. Recall that before now, we reported that the U.S. Policymakers also confirmed plan to increase rates twice this year, while raising the forecast for rate hikes in 2019. The United States Federal Reserve said it had decided to raise the rate by 0.25% to a target range of 1.5% -1.75%.

Confirming the reality of increasing Fx outflows as against inflows is the strengthening dollar against the naira. In reaction to these, the CBN were seen coming tough on both Banks and BDC operators in other to ensure compliance with its Fx sale policies. The above factors notwithstanding, the upcoming election remains a major internal factor negatively impacting investment decisions in the nation’s capital market. Most traders maintained negative side as the politicking towards the election heightened.

Please understand that, despite the dwindling prices of listed equities, corporate earnings remained intact. The implication is that, earnings yield will improve in the coming half year earnings season, as equities become cheaper and accessible. We are of the opinion that taking advantage of dropping prices against fundamentals remains intelligent investment decision. As fondly noted in our reports, equities with half year incentive policy should top in traders trading baskets. Safe Trade.

Comment here