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STOCK MARKET

Investors embrace Nigerian stocks, with portfolio investment rising by N40.5 billion

Domestic transactions accounted for 70.33% while foreign transactions accounted for 29.67% of the total transactions.

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The Nigerian Stock Exchange appears to be gaining significant traction as total portfolio investments rose by N40.5 billion in September 2020.

This was contained in the domestic and foreign investments report released by the Nigerian Stock Exchange (NSE).

According to the report, the total portfolio investments rose by 42.9% compared to 94.45 billion recorded in August 2020. The breakdown of the report shows that domestic transactions accounted for 70.33% of the total transactions, while foreign transactions accounted for 29.67% of the total transactions in September.

Key highlights

  • Total domestic transactions completed year to date (YTD) is about N825.94 billion, while foreign transactions completed YTD is about N510.25 billion.
  • Foreign inflows decreased by 71.67% since the last rise in September 2019, while Foreign Outflows decreased by 70.31% since the last rise in March 2020.
  • The total value of transactions completed by Domestic Investors in September 2020 surpassed that of the total value of transactions completed by Foreign Investors by N54.87 billion.
  • Portfolio investments increased sharply by 42.9% from N94.45 billion (about $244.27 million) in August 2020 to N134.97 billion (about $349.85million) in September 2020.
  • Compared with September 2019 (N141.45 billion), the performance of the current month indicates that total transactions decreased by 4.58%.

As illustrated in the chart, total transactions completed between August and September 2020 indicated that total domestic transactions surged by 71.12% from N55.47 billion in August to N94.92 billion in September.

Also, total foreign transactions increased by 2.74% in September 2020 from N38.98 billion (about $100.81 million) in August 2020 to N40.05 billion (about $103.81million) in September 2020.

Meanwhile, for domestic transactions, analysis revealed that Institutional Investors outperformed Retail Investors by N23.54 billion.

A comparison of domestic transactions in the current and prior month (August 2020), revealed that both retail and institutional transactions increased by 34.12% from N26.61 billion in August 2020 to N35.69 billion in September 2020, and 105.23% from N28.86 billion in August 2020 to N59.23 billion in September 2020 respectively.

For foreign transactions, analysis revealed that Foreign Outflow outperformed Foreign Inflow by N12.05 billion. A comparison of foreign transactions in the current and prior month (August 2020) revealed that Foreign Inflow declined by 20.72% from N17.66 to N14 billion, while Foreign Outflow increased by 22.19% from N21.32 to N26.05 billion.

What you should know

  • Over a 6-year period, based on the data available on the NSE, analysis indicated that total domestic transactions decreased by 67.94% from N296.06 billion in September 2014 to 94.92 billion in September 2020; while total foreign transactions decreased by 82.33% from N226.68 billion in September 2014 to N40.05 billion in September 2020.
  • Total domestic transactions accounted for 70.33% of the total transactions carried out in September 2020, while foreign transactions accounted for 29.67% of the total transactions in the same period.

What this means

Considering the importance of foreign investment, the decline is particularly alarming and could indicate that foreign investors are shying away from Nigerian stocks. Meanwhile, more Nigerian investors are venturing into the market compared to previous months.

However, the encouraging factor is that total foreign and domestic portfolio figure recorded in September is the highest since the dip in March. This may well mean that stocks are beginning to pick up, which is good news for stock investors.

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STOCK MARKET

Nigerian stocks slightly bullish as ETERNA and UPL soar

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The stock exchange market made a bullish trend at the end of today’s trading session posting gains that increased the index by +5.47 points. The All-Share Index increased by +0.01% closing at 37,952.65 from 37,947.18 index points.

• The stock exchange market value currently stands at N19.78 trillion. Its Year-to-Date (YTD) returns currently stand at -5.76%.
• The market breadth closed positive as ETERNA led 22 Gainers, and 10 Losers topped by FTNCOCOA at the end of today’s session.
• The stock market has declined -2,318.07 basepoints since the start of the year.

NGX ASI top gainers

1. ETERNA up +10.00% to close at N7.13
2. UPL up +9.93% to close at N1.55
3. CUTIX up +9.92to close at N3.99
4. REGALINS up +8.89% to close at N0.49
5. LEARNAFRCA up +8.76% to close at N1.49

NGX ASI top losers

1. FTNCOCOA down -7.32% to close at N0.38
2. SOVRENINS down -6.06% to close at N0.31
3. ETI down -3.77% to close at N5.10
4. STERLNBANK down -3.21% to close at N1.51
5. UBN down -2.68% to close at N5.45

Outlook
• Market sentiments trend towards the bulls as 22 gainers outweighed 10 losers.

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STOCK MARKET

US stock market dips amid rise in Moderna, BioNTech

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As inflation fears overshadowed solid retail sales statistics and better-than-expected earnings reports, US markets dipped on Friday, sending the Dow Jones Industrial Average into the red for the week.

After Treasury Secretary, Janet Yellen issued an inflation warning, the Dow Jones Industrial Average fell. Meanwhile, Virgin Galactic (SPCE) fell once again, putting it on course for a huge weekly loss. AMC Entertainment (AMC), a meme stock, is also down this week.

Moderna (MRNA) soared on news of its inclusion in the S&P 500, while BioNTech (BNTX) remained on the rise.

Inflation fears kept the market back all week, but the S&P 500 and the Dow did briefly reach fresh all-time highs. The consumer price index rose 5.4 % in June from a year ago, the quickest rate in nearly 13 years, according to data released on Tuesday.

Quick market analysis  

Among the main indices, the Nasdaq fared the best, although it still declined approximately 0.6 %. Cintas (CTAS) was the best performer, gaining more than 4%, while Trip.com (TCOM) was the worst performer, losing just over 4%.

The S&P 500 lost 0.6%, closely matching the Nasdaq. Teleflex (TFX) was a standout performer, rising more than 3%. However, the stock dropped over 10% on Thursday. Norwegian Cruise Line (NCLH) was the worst performer in the S&P 500, falling nearly 5%.

Sectors in the S&P 500 were mixed, with utilities and real estate leading the way. The worst were energy and materials. The Russell 2000 index was down roughly 0.6%, indicating that small caps were sliding again.

The Dow Jones Industrial Average fell by about 8%, Amgen (AMGN) and Procter & Gamble (PG) were the best-performing stocks, with Amgen up 0.7% and Procter & Gamble up 1.1%.

The stock of Virgin Galactic continued to fall, this time by roughly 5%. It has been falling all week as a result of reports of a large share offering, and is on track to suffer a weekly loss of about 40%. SPCE stock began to fall sharply after the company said in a regulatory filing that it wants to sell up to $500 million in stock.
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STOCK MARKET

Nigeria’s stock market soars amid plunge in CWG and IKEJAHOTEL

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Nigeria’s stock exchange market ended today’s trading session bullish, posting a profit at the end of the trading session. The All-Share Index increased by +0.18% to close at 38,482.52.

• The Nigerian Stock Exchange market value currently stands at N20.3Trillion. Its Year-to-Date (YTD) returns currently stands at -4.44%.
• The market breadth closed positive today as UPL led 15 Gainers, and 20 Losers were topped by CWG at the end of the session showing a consolidation as movement is not certain.

Top gainers

1. UPL up +9.38% to close at N1.40
2. REGALINS up +8.16% to close at N0.53
3. VERITASKAP up +5.00% to close at N0.21
4. CHIPLC up +4.17% to close at N0.75
5. ROYALEX up +3.90% to close at N0.80

Top losers

1. CWG down -9.66% to close at N1.87
2. IKEJAHOTEL down -9.09% to close at N1.00
3. NASCON down -8.78% to close at N13.50
4. JOHNHOLT down -8.62% to close at N0.53
5. LINKASSURE down -8.33% to close at N0.55

Outlook

• Market sentiments trend towards the bulls as 15 gainers outweighed 20 losers.

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