What to Expect at Equities Market This Week

By Modupe Gbadeyanka

Last week, the Nigerian Stock Exchange (NSE) recorded a week-to-week growth of 3.76 percent despite fears of political uncertainty in the country.

It was observed that the bullish sentiment was buoyed by anticipation of positive corporate earnings for the 2018 financial year.

Last week, Transcorp Hotels, Nigerian Breweries and Transcorp Plc released their 2018 financial scorecards to the investing public, announcing payment of dividends to shareholders.

As we begin this trading week, analysts at Business Post are of the opinion that investors will continue to buy more shares, especially of fundamentally sound firms, in anticipation of good yields and dividend payout.

More companies listed on the exchange will release their results this week and we do not expect the postponement of the presidential and national assembly elections last Saturday to this weekend by the Independent National Electoral Commission (INEC) to take its toll on the market. But we expect massive selloffs as soon as the earnings season is over and outcome of the polls is known.

For analysts at Cowry Asset, they are of the opinion that, “In the new week, we expect the Nigerian equities market to close in green territory.

“We expect investors to remain bullish on the back of improved corporate earnings, violence-free elections and the possibility of the emergence of a market-friendly president.”

In their review of the market, analysts at Morgan Capital advised investors to “trade with utmost caution” as “political activities continue to cloud investment strategies” during this period.

Analysts at Meristem Research noted that they expect the market to continue to enjoy this positive run especially with the mass re-entry of investors into the market, who took advantage of relatively low prices many of the counters.

“We expect to see a market rally at the start of the week driven by a return of certainty following the successful conclusion of the presidential election, barring any political unrest from the election results,” those at Vetiva Research said.

In the same vein, Afrinvest analysts said, “We expect the direction of market to be largely determined by the election outcomes next (this) week, nonetheless, we expect the market to perform positively based on the sentiments we have observed this (last) week.”