Local Bourse Rebounds by 1.23% w/w on Sustained Positive Sentiment

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GLOBAL MARKET

World Stocks Gain, as U.S Data Boosters Sustain Global Economy Recovery

This week, buy interest dominated in ten (10) of the fourteen (14) stock markets under our coverage, as global shares reach new high, as batches of U.S. data in May cheered investors for signs of a continued rebound in the world’s largest economy.

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Firstly, the Institute of Supply Management (ISM) report shows the index for national factory activity increased to a reading of 61.2% last month from 60.7% in April. Also, the hotly anticipated U.S non-farm payroll data released showed 559,000 jobs were created in May, and U.S. job claims fell below 400,000 for the first time since the pandemic started more than a year ago and private payroll increased significantly more than expected.

Consequently, all the broadest market indices in the U.S under our coverage, which includes Nasdaq Composite Index, S&P 500 Index, and the DJIA Index grew by 0.48% w/w, 0.61%, and 0.66% w/w respectively.

Similarly, the major market around Europe, France CAC 40, German DAX, and UK FTSE 100 Index grew by 0.49% w/w, 1.11% w/w, and 0.66% w/w respectively. However, all the major market indices in Asia under our coverage, which includes China Shanghai Composite, Japan Nikkei 225, Hong-Kong HANG SENG, dropped by 0.25%w/w, 0.71%w/w, and 0.71%w/w respectively, except the India S&P BSE Index that gained 1.32%w/w.

Furthermore, three of the four indices in the emerging market indices under our coverage, Argentina MERVAL, Brazil’s BOVESPA, and South-Africa FTSE/JSE Index increased by 11.78%w/w, 3.64%w/w, and 0.40%w/w respectively, save for Egypt EGX 30 that lost 1.83%w/w.

We expect to see more recovery in the next trading week in reaction to U.S economic data that reopened recovery hopes

 

EQUITY MARKET

 Local Bourse Rebounds by 1.23% w/w on Sustained Positive Sentiment

Transaction on the Nigerian Equity Market closed w/w on a positive note, as bullish performance dominated four of the five trading sessions. This was due to investors’ sustained buy-interest in recently depreciated medium and large capitalized stocks. Consequently, the Market Indicators (NGXASI and NGX Market Capitalization) surged by 1.23% w/w to close for this week at 38,726.10 absolute points and N20.18 trillion compared to 38,256.95 absolute points and N19.94 trillion last Friday. This nominally translated to a week-on-week gain of N245 billion in Market Capitalization value. Hence, The year-to-date return stood at -3.84%.

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Industrial Goods Sector, Insurance Sector, and Banking Sector closed positively with percentage of (+2.60%), (+1.25%), and (0.04%) respectively while the remaining two major sectors closed negatively, led by the Oil and Gas Sector (-0.79%), and Consumer Goods Sector (-0.37%).

UPL emerged best performing stock this week with a w/w gain of +43.59%, while CWG shed -26.09% to emerge as the top loser.

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A total turnover of 1.08 billion shares worth N9.55 billion naira in 17,930 deals was traded this week by investors on the floor of the Nigerian Exchange Group as against a total of 1.04 billion shares worth N9.47 billion naira in 17,571 deals

Thirty-three (33) equities appreciated during the week, higher than thirty-one (31) equities in the previous week. Thirty-three (33) equities depreciated, higher than twenty-nine (29) equities in the previous week, while ninety-five (95) equities remained unchanged lower than one hundred and one (101) equities recorded in the previous week.

Outlook

We expect mixed sentiment to continue in the coming week, the bulls would take advantage of the low prices of the recently depreciated stocks while the bears might take profits from recently appreciated stocks.

 

FOREIGN EXCHANGE MARKET

At the I&E FX windows, the USD closed the week at ₦410.75/USD against ₦412.00/USD from last Friday’s position. In the meantime, the foreign reserves this week weakened by $27.33 million to the level of $34.22 billion (05/06/2021) from $34.25 billion (27/05/2021), however, the Brent Crude oil price appreciated by $3.17 pbl w/w to $71.89 pbl (04/06/2021) as against $68.72 (28/05/2021) pbl.

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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