TRADING on the Nigerian equities market continued its bearish trend yesterday as NSEASI depreciated by -0.40% to close at 39,364.67 basis points as against -0.44% depreciation recorded previously. Its Year-to-Date (YTD) returns currently stands at -2.25%.

Market breadth closed negative as UPL led 12 Gainers as against 46 Losers topped by Fidson at the end of yesterday’s session – an unimproved performance when compared with the previous outlook.

Market turnover closes positive as volume moved up by +101.84% as against the +9.78% uptick recorded in the previous session. Universal Insurance, Zenith Bank and FBNH were the most active to boost market turnover. Presco and Zenith Bank topped the market value list.

UNIVINSURE leads the list of active stocks that recorded an impressive volume spike at the end of today’s session.

The downward oscillating trend continued on NSE on Tuesday as price corrections and pullbacks persist, exposing the level of risk associated with trade at this point that Treasury Bills’ yield is making that segment of the financial markets compete for scarce funds with equity assets despite the ongoing earnings season.

The market has not reacted yet to the relatively impressive corporate numbers and payouts announced by companies listed on the NSE, a situation that seemingly suggest funds are not entering the market at this moment. Such changing pattern in trades require that players should review their investment objectives, as well as their ‘buy’ and ‘sell’ strategies to protect capital, while also reviewing sector rotations to take advantage of these pullbacks for repositioning this year.

Analyst noted that the composite All-Share index’s action has broken down the 40,000-support level, it is now moving towards the next one sported around 38,700.00bps, and should the index break this point, its next visible support is far down 34,396.30 points.

Technically, therefore, the ongoing negative move is best described as a market correction, and the consistent downtrend could be linked to the consistency with which it gained during the bull-run that lingered until January.

The full-year earnings season may not be strong enough to end the correction, except it is supported by favourable and positive economic indices, which the positive news of Nigeria exiting recession may be a part of, if the recovery or growth is sustained and the nation’s security challenges addressed by government as quickly as possible.

analyst is also seeing pointers already to a further spike in inflation rate, given the blockade of farm produce from the north to southern Nigeria, leading to destruction of such perishable items on one side, and the huge impact of artificial scarcity on the opposite side. A segment of farmers in the north has estimated their loss alone, from the incidence at over N10bn, an amount that could significantly increase when the impact down the value-chain, including revenue loss on both sides is considered.

Tuesday’s trading started on the downside and was sustained throughout the day, despite the seeming oscillation on selloffs and buying interests in dividend stocks that had announced their payout. This situation pushed the NSE’s index to an intraday low of 39,668.22 basis points from its 39,939.18bps high, before closing below its opening point at 39,697.62bps on a low traded volume.


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