U.S. Stock futures started the trading week on a bearish footing, signaling losses at the opening U.S trading session on Monday. U.S stocks were hit by growing concern about new restrictions triggered by rising COVID-19 cases.
What we know; Futures contracts on the S&P 500 Index plunged by 1.51% at the time this report was drafted, pointing to a fourth straight daily decline, the longest stretch of losses for the gauge since the end of February.
Contracts on the Dow Jones Industrial Averageand Nasdaq 100 fell 1.85% and 1.5%, respectively.
Quick fact; American Stock futures are simply standardized contracts that global traders use in purchasing or selling the U.S stock in a future date. This means that the U.S stock futures give an insight into what global investors see before the market opens, or after it close
Stephen Innes, Chief Global Market Strategist at AxiCorp, in a note our source spoke on the prevailing fundamentals, giving stock bears an edge. Stock futures opened uncertain as investors remain confused about which way to move this morning as lockdown fears take charge with the UK government sounding alarm bells as the Covid-19 curve moves in the wrong direction.
After the initial economic bounce from full-blown lockdowns, both the UK and Europe’s economic trajectory could be entering a gloomy second phase characterized by ongoing social distancing, elevated unemployment, and increasing damage to the supply side.
He also spoke on the parabolic nature of the world’s largest equity market, as the U.S election sets in, by saying;
“However, they remain weighed down by a drip-feed of negativity around Covid-19 resurgence, US fiscal impasse and as the market starts to factor in US election risk in earnest. Retail and hedge funds bought the initial Nasdaq dip after the September 2 carnage. But since then, there has been a noticeable shift in trading behavior where bounces are quickly faded.”
Political tensions also making global investors shaky as Democrats and Republicans prepare to fight over who will be the next Supreme Court justice.
#EndSARS: Nigerian stocks end neutral amid protests
The market breadth index was positive with 13 gainers against 11 losers.
The Nigerian bourse closed flat today as the All Share Index remained at 28,344.33 points for the second consecutive trading.
A total volume of 342.1 million units of shares, valued at N5.03billion exchanged hands in 4,048 deals.
- UBA was the most traded shares by volume at 92.8million units, while GUARANTY and ZENITHBANK topped the market value list at N1.84billion and N1.34billion respectively.
- The market breadth index was positive with 13 gainers against 11 losers. ETERNA (+9.98%) led the gainer’s chart today, while GLAXOSMITH (-3.45%) topped the laggards.
- NSE Banking Index: Down by -0.74%, due to sell-offs in GUARANTY (-1.67%), ACCESS (-1.27%), and ETI (-1.15%).
- NSE Insurance Index: Depreciated by -0.45%, on price depreciation in AIICO (-3.57%).
- NSE Oil & Gas Index: Fell by -0.29%.
- NSE Consumer Goods Index: Up by +0.40% on buy-interests in GUINNESS (+3.23%), INTBREW (+3.19%), and PZ (+2.38%).
- NSE Industrial Index: Improved by +0.30%, on the back of price appreciation recorded in WAPCO (+4.03%).
ETERNA up 9.98% to close at N5.29
WAPCO up 4.03% to close at N18.05
GUINNESS up 3.23% to close at N16
INTBREW up 3.19% to close at N4.85
VITAFOAM up 1.67% to close at N6.1
GLAXOSMITH down 3.45% to close at N5.6
FIDSON down 3.00% to close at N3.56
AFRIPRUD down 2.81% to close at N5.54
GUARANTY down 1.67% to close at N29.5
ACCESS down 1.27% to close at N7.75
What this means
Nigerian bourse ended the trading session neutral for 2 consecutive days, following oil prices and the U.S dollar rebounding up.
- Unsurprisingly, trading activities were dampened amid the prevailing macro, showing that the protests for Nigerian police reforms by Nigerian youths have entered a critical phase.
- The inflation rate surged to 13.71% (year-on-year) in September 2020, indicating a 0.49% point difference when compared to 13.22% recorded in August 2020. This weakened buying pressure in financial-based stocks.
- Also, some leading western nations are beginning to report higher cases of COVID-19 infections, fueling serious speculations of imminent lockdown. This has dampened the resolve that global investors would increase their buying pressure at the biggest exchange of sub-Saharan Africa and weakened traders’ morale on Thursday.
NSE emerges world’s best, posts biggest daily gain in 5 years
The Nigerian Stock Exchange (NSE) has emerged the best performing stock exchange in the world on Tuesday upon its Market capitalisation, Themoneymetrics reports.
Market capitalisation, which opened at N14.40 trillion, crossed the N15 trillion mark to close at N15.11 trillion as investors gained N949 billion.
The all-share index rose by 1,354.88 or 4.92 percent to close at 28,909.37 against 27,554.49 points on Monday, the biggest gain since April 1, 2015.
The uptrend was impacted by gains recorded in large and medium capitalised stocks, amongst which are; Dangote Cement, MTN Nigeria Communication, Presco, Nigerian Breweries and Stanbic IBTC Holdings.
Consequently, the market breadth closed positive with 45 gainers compared with eight losers.
This is the 12th consecutive day that the market has closed in the green.
Cornerstone Insurance, International Breweries and Presco led the gainers’ chart in percentage terms, with 10 percent each, to close at 66k, N4.29 and N60.50 per share, respectively.
FBN Holdings followed with 9.91 percent to close at N6.10, while Northern Nigeria Flour Mills rose by 9.88 percent to close at N4.45 per share.
Dangote Cement gained 9.86 percent to close at N158.20, while Lafarge Africa appreciated by 9.69 percent to close at N17.55 per share.
Transactions in the shares of Zenith Bank topped the activity chart, accounting 135.69 million shares valued at N2.77 billion.
United Bank for Africa followed with 112.89 million shares worth N768.18 million, while FBN Holdings traded 89.91million shares valued at N544.41 million.
Access Bank sold 56.03 million shares worth N426.27 million, while Guaranty Trust Bank transacted 40.06 million shares valued at N1.22 billion.
Ambrose Omordion, the chief operating officer of InvestData Ltd., said that low interest and undervalued state of the stock market had triggered an inflow of funds to blue-chip and growth stocks in search of better return in a hyperinflation environment.
Omordion said the trend is likely to persist till third-quarter numbers started hitting the market.
The monetary policy committee of the Central Bank of Nigeria (CBN) reduced the monetary policy rate by 100 basis points at its September meeting which has resulted in lower interest rates.
MTN Nigeria, Dangote Cement stocks fired up, investors gain whopping N708 billion
The aggregate market value of all quoted equities rose from its opening value of N14.202 trillion to settle at N15.110 trillion.
Nigerian Stocks continued its bullish run today for the 12th consecutive session, as increased bargain-hunting across the sectors netted N708.14 billion gains in today’s trading session. This brings the net capital gains in the three trading sessions in October to N1.085 trillion.
Consequently, the average year-to-date return improved to a whopping 7.62%.
- The All Share Index appreciated by a remarkable 4.92% to cross 28,909.37 points from its opening index of 27,554.49 points. Also, the aggregate market value of all quoted equities rose from its opening value of N14.202 trillion to settle at N15.110 trillion.
- Market turnover soared to 749.46 million shares valued at N9.49 billion in 8,075 deals. Transactions in the shares of Zenith Bank topped the activity chart with 135.69 million shares valued at N2.77 billion.
- UBA followed with 112.88 million shares worth N768.1 million, while FBN traded 89.9 million shares valued at N544.4 million.
Bullish sector performance buoyed the ASI as all sectoral indices closed positive.
- With 45 gainers to 8 losers, all sectoral indices closed positive.
- The NSE Banking Index led to a massive gain of 7.48%. The NSE Industrial and Consumer Goods Indices trailed appreciating by 5.46 and 2.95% respectively. The NSE Oil & Gas Index appreciated by 1.15% while the NSE Insurance Index finished with a 0.26% increase.
- NSE Banking Index: Recorded an impressive 7.48% gain, on uptrend in FBNH (+9.91%), ZENITH (+9.47%), UBA (+9.30%), GTB (+6.03%) and STANBIC (+4.94%).
- NSE Industrial Index: Up by +5.46%, on DANGCEM (+9.86%) and WAPCO (+9.69%) upturn.
- NSE Consumer Goods Index: Gained 2.95%, on buy interest in NB (7.17%), GUINNESS (+6.00%), and DANGSUGAR (+4.55%)
- NSE Oil & Gas Index: Appreciated by 1.15%, on the back of the gains in OANDO (+9.57%) and ARDOVA (+8.97%).
- NSE Insurance Index: Improved by +0.26%, on price appreciation in CORNERSTONE (+10.00%)
PRESCO up 10.00% to close at N60.5
DANGCEM up 9.86% to close at N158.2
NB up 7.17% to close at N52.3
MTNN up 5.70% to close at N142
STANBIC up 4.94% to close at N42.5
NPFMCRFBK down 8.76% to close at N1.25
WAPIC down 7.69% to close at N0.36
BERGER down 6.15% to close at N6.1
NEIMETH down 5.13% to close at N1.85
REDSTAREX down 1.52% to close at N3.25
It is fair to say institutional investors are back at Sub Sahara’s biggest Exchange, printing impressive gains, as the Nigerian bourse market capitalization tilted above N15 trillion.
- Unsurprisingly buying pressure was maintained in notable Nigerian Stocks, like MTN Nigeria, Dangote Cement, Nigerian Breweries, and Stanbic Bank
- Market liquidity had also improved in the last few days as Institutional investors restrategize their portfolio investments for Q4, 2020.
Its to seem stock traders are not short of positive macros now, as Nigeria’s major export, crude oil printed more than 3% gains to trade near $43/Barrel.
- Themoneymetrics however envisages caution, among these impressive gains recorded in the past weeks, as Africa’s largest economy remains vulnerable via a report credited to Fitch Ratings buttressed the FX demand backlog and persistence in external vulnerability are adequately captured by the ‘B’ rating.
- It should also be noted this bullish trend is not broad-based as only a few Nigerian Stocks across the spectrum have benefited from the rally.
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