After closing June with a month-on-month increase of +0.76 percent, the all-share index rallied positiely, reaching the 100,000 threshold for the first time since April 16, 2024 and was driven by buy sentiment from the window dressing activities of fund managers.
Last week’s cash trading saw positive upsides, halting a bearish pattern and three consecutive sessions of a bear-run on low traded volume and positive market breadth.
As a result, the benchmark index closed the week up by 0.32 percent, settling at 100,057.49 points for the first time since 16 April 2024, as investors positioned themselves in both small and large-cap corporates in anticipation of the half-year reporting season.
Consequently, the market capitalization of listed equities increased by 0.32% week on week to N56.60 trillion, despite tepid investor sentiment and waning market activity levels.
Equity investors gained a total of N178.05 billion from two out of the five trading sessions last week, bringing the year-to-date return of the index to 33.81 percent.
In the review week, trading activity was subdued, as evidenced by the total volume and value of trades, despite positive market breadth with 48 weekly gainers compared to 35 weekly losers.
The total traded volume dropped by 19.69 percent week on week to 2.65 billion units, while the total weekly traded value decreased slightly by 5.98 percent week on week to N49.98 billion.
However, reversing the prior week’s performance, the total number of trades for the week improved by 51.11 percent week on week to 41,610 deals.
Sectoral performance was largely positive this week, except for the NGX-Consume Goods and NGX-Industrial Goods sectors, which trended downward by 0.56 percent and 0.33 percent week on week, respectively, due to negative price movements in BETA GLASS and WAPCO. Conversely, the NGX-Oil & Gas and NGX-Insurance indices led the gainers’ chart with increases of 5.71 percent and 3.33 percent, respectively, while the NGX-Banking index also reported gains of 1.14 percent week on week.
Stocks contributing to these gains included UCAP, MBENEFIT, SEPLAT, FBNH, and FIDELITYBNK. At the close of the week, notable performers such as CWG (+45%), FTNCOCOA (+22%), UCAP (+22%), JOHN HOLT (+20%), and MBENEFIT (+20%) emerged as the best performing securities, driven by positive activities that propelled their price movements.
Conversely, negative investor sentiment led to sell-offs in JAIZBANK (-11%), DAARCOMM (-11%), CHAMPION (-11%), UPL (- 9%), and BETAGLASS (-9%), positioning these stocks as the top losers for the week.
Looking ahead to this week, stock market analysts at Cowry Assets Limited anticipated that the new trading quarter will commence strongly, albeit with mixed sentiment from market investors.
“The market will focus on the forthcoming earnings reporting season and interim dividends from the banking sector and a few other companies. The changing market structure on the NGX continues as bargain hunters take advantage of recent pullbacks and corrections to buy into value amidst ongoing portfolio repositioning ahead of Q2 numbers, ushering in the second half of the year. Investors are advised to seize opportunities in stocks with strong fundamentals,” experts said.
On the global front, inflation was the focal point in the review week across global equities as signs of a cool down following the latest personal consumption expenditures (PCE) price index data reinforced bets that the US Federal Reserve could start cutting interest rates this year.
Accordingly, US equities (DJIA: +0.1%; S&P 500: +0.2%) were poised for a weekly gain buoyed by hopes of interest rate cuts following the signs of a cooling economy as revealed in the latest PCE data, jobless claims, and May’s durable goods data. Meanwhile, European equities (STOXX Europe: -0.9%; FTSE 100: -0.7%) were on track for a weekly loss as investors digested a lower-than-expected consumer-confidence reading from Germany.
Asian markets were mixed, as Japanese equities (Nikkei 225: +2.6%) recorded gains due to bargain hunting in technology stocks on expectations of improved earnings from a weaker yen, while Chinese equities (SSE: -1.0%) fell amid concerns over rising geopolitical tensions and doubts about China’s economic recovery.
Elsewhere, the Emerging (MSCI EM: -1.3%) and Frontier (MSCI FM: -0.6%) markets posted losses on bearish sentiments in China (-1.0%) and Vietnam (-2.0%), respectively.