Banking sector led others to equity market five-star week

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GLOBAL MARKET

Global Stocks sees sell-off, amidst increase in capital gain tax

This week, sell interest dominated in eleven (11) of the fourteen (14) stock markets under our coverage, on the report of a possible U.S Capital Gain Tax hike to near 40% for the wealthy investors earning $1 million or more.

As a result, all of the three broadest market indices in the U.S, which includes the DJIA Index, the S&P 500, and the Nasdaq Composite Index declined by 0.46% w/w, 0.13% w/w, and 0.25% w/w respectively, as the Federal Reserve meets next week.

Global market 23.04.2021 1

Similarly, the major market around Europe, UK FTSE 100, German DAX, and France CAC 40 all lost 1.15% w/w, 1.17% w/w, and 0.46% w/w respectively, despite the European Central Bank (ECB) maintaining its ultra-easy monetary policy in the recent meeting.

However, mixed sentiment prevailed across the major market in Asia, as Hong-Kong HANG SENG Index and China Shanghai Composite Index gained 0.38%w/w and 1.39%w/w respectively, while the Japan Nikkei 225, and India S&P BSE lost 2.23%w/w and 1.95%w/w respectively, amid reports of a resurgence of Covid-19 cases in the region.

Furthermore, three of the four emerging market indices under our coverage, Brazil’s BOVESPA, Argentina MERVAL Index, and South-Africa FTSE/JSE Index all lost 0.48%w/w,  0.61%w/w  and 2.04%w/w  respectively, save Egypt EGX 30 that gained 4.50%w/w.

We expect to see some mixed recovery in the next trading week in reaction to the report of a possible U.S Capital Gain Tax hike and the upcoming Federal Reserve Meeting.

EQUITY MARKET

Banking sector led others to equity market five-star week

The Nigerian equity market witnessed a five-star week by gaining 1.27%w/w, amidst Q1’2021 earnings reports and recently low price of many fundamental stocks.

As a result, the Market Indicators (NSE-ASI and NSE Market Capitalization) increased by 1.27% w/w to close for this week at 39,301.82 absolute points and N20.57 trillion compared to 38,808.01 absolute points and N20.31 trillion last Friday. This nominally translates to a week-on-week gain of N26 billion in Market Capitalization value.

All of the five major sectors closed positively, led by the Banking Sector (+4.82%), Consumer Goods Sector (+1.05%), Industrial Sector (+0.50%), Insurance Sector (+0.40%), and Oil and as Sector (+0.29%).

Gainers 24042021

PZ emerged best performing stock this week with a w/w gain of   +21.11%, while FTNCOCOA shed -22.00% to emerge as the top loser.

A total turnover of 1.60 billion shares worth N42.14 billion in 19,507 deals was traded this week by investors on the floor of the Nigerian Stock Exchange as against a total of 1.26 billion shares worth N10.76 billion in 19,975 deals.

Losers 24042021

Thirty-nine (39) equities appreciated in price during the week, higher than Eighteen (18) equities in the previous week. Twenty-four (24) equities depreciated in price lower than Forty-seven (47) equities in the previous week, while ninety-nine (99) equities remained unchanged, higher than ninety-seven (97) equities recorded in the previous week.

Outlook
The anticipated positive performance of many banking and consumer goods sectors in Q1’2021 is expected to continue to drive long-term investors to the market, but the rising fixed-income yields are still on the negative side of the stock market.

FOREIGN EXCHANGE MARKET

The Naira this week remained unchanged against the USD at the official window to close the week at ₦379/USD as against the previous week, while at the I&E FX windows, the USD closed the week at ₦410.00/USD unchanged from last Friday position.
In the meantime, the foreign reserves this week declined by $103million from the level of $35.23 billion (15/04/2021) to $35.12 billion (22/04/2021), as the Brent Crude oil price also dropped $0.05pbl w/w from $66.16pbl last Friday to $66.11pbl.

Source: GTI Research

GTI

GTI is a leading Nigerian Investment Banking group with proven expertise in Financial advisory, Securities Dealing (Fixed Income and Equities), Asset management and Deal Origination. We have strong capacity in financial service delivery.

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