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210710: Zenith Bank announces Q2 results; Cadbury, NASCON lead gainers as upbeat continues

Category: Daily & Weekly Market Updates


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210710: Zenith Bank announces Q2 results; Cadbury, NASCON lead gainers as upbeat continues

 
The bulls that resurfaced at the stock market yesterday with marginal All-Share Index appreciation of +0.08% and appreciation in market capitalisation by N4.575 billion continued at the close of trading session as market performance indices trended northward.


Transactions volume on the Nigerian Stock Exchange also closed higher of the previous day’s figures, driving mainly by transactions in the shares of banking stocks; however, transaction value which measures the liquidity flow into the market declined marginally.


The sustained positive outlook recorded at the close of trading session was not unconnected with the positive developments in the market, with specific reference to the Asset Management Company, which robbed off more positively on the banking sector performance for the day to outperform the previous day’s trend.


Other factor that could be linked to the positive outlook is the fact most of the stocks have shed massive price weight, and discerning investors would continue to position in such stocks for most probable capital appreciations. This could be more real now that market is not likely to go on depressive mood as before.


With the performance recorded on the Nigerian Stock Exchange so far, now at +19.86% YTD performances, the market has been adjudged one of the leading performing markets in America, Europe and Asia in the first half of 2010, to close as the fourth highest mover in Africa but better than what some markets in American, Europe and Asia returned.


Another factor that aid the northward push of market performance are efforts being made by the regulators in Nigeria to restore investor confidence in the Nigerian stock market, such as the Securities and Exchange Commission (SEC) commitment to strengthen the regulatory framework which has led to issuance of many rules to that effect.


As market awaits the release of the remaining second quarter results in the banking sector, there are indications that Guaranty Trust Bank Plc may likely delight its shareholders with an interim dividend as the Board of Directors meets today to consider the financial statements for the half year ended June 30, 2010. The bank, which declared a dividend of 75kobo and a bonus of 1 for 4 shares already held for the year ended December 31, 2009 has notified the Nigerian Stock Exchange (NSE) of the Board meeting.


Meanwhile, Zenith Bank Plc released its quarterly results for the period ended 30th June, 2010. According to the results, gross earnings for the period declined by -12.80% to close at N96.850 billion. However, there was improvement in profitability by +116.29% to close at N21.305 billion. This translates to Earnings per share (EPS) of N0.68.


Barring any negative news in the market and in the absence of policy summersault from the regulatory authority, we expect the ongoing smooth ride of the market to continue, though not without most likely volatility as there would be profit takings as market trend unfolds in the days ahead.


As usual, banking sector led the market transaction volume today with 239.296 million units valued at N1.286 billion (US$8.590 million) exchanged in 3,473 deals. Transactions in the shares of Platinum Bank Plc, Sterling Bank Plc, Zenith Bank Plc and Guaranty Trust Bank Plc boosted the volume traded in the sector. The total volume of 159.982 million units valued at N778.538 million traded in the shares of the four banks accounted for 66.85% of the entire sector volume and their value represented 60.54% of the sector’s value.


The number of gainers at the close of trading session inched up forty two (42) compared with thirty four (34) gainers recorded yesterday, while decliners closed at twenty (20) compared with nineteen (19) losers recorded in the last trading day. Market closed with 2:1 advancers to decliners’ ratio.


At the close of trading session, the All-Share Index inched up marginally by +0.72% to close at 24,963.99 compared with appreciation by +0.08% recorded on Tuesday to close at 24,784.85. Market capitalisation also appreciated by N43.467 billion (US$290.363 million) to close at N6.105 trillion (US$40.784 billion) compared with appreciation by N4.575 billion (US$30.563 million) recorded on yesterday to close at N6.062 trillion (US$40.493 billion)





SECTORAL REVIEW
Transactions in the Agriculture sector closed with one gainer to a loser, a repeat of the previous day’s trend in the sector.


Positive outlook continued in the Air Service sector at the close of trading session as the share price of Nahco Aviance Plc maintained northward direction.
Positive outlook remained in the banking sector as bears’ hold in the sector continued to deplete by the day. Transactions closed in the sector closed with fifteen gainers to four losers compared with thirteen gainers to four losers recorded yesterday. The success story of AMCON bill continues to stir investors’ interest.  


The bulls influence in the Breweries sector was over powered by the bearish trend as the only price change recorded was on the negative note compared with two gainers recorded yesterday.


The tempo of improvement recorded in the building materials sector yesterday could not be sustained at the close of trading session as the transactions in the sector closed one gainer to one loser compared with two gainers recorded yesterday.


Performance of stocks in the Conglomerate sector at the close of trading session posted relative decline when compared with the performance of the previous trading day. Transactions closed in the sector with a loser while other prices closed at their previous closed compared with all the price changes being in the positive recorded yesterday.  


The performance of shares in the Construction sector improved relatively today as transactions in the sector closed with a gainer compared with a massive loser recorded yesterday.


The number of gainers in the Food & Beverages sector rose to seven compared with four gainers recorded yesterday while the number of losers closed at three compared with one decliner recorded yesterday. Stocks in the sector also present buy opportunities for discerning investors.


The rate of volatility remains in the insurance sector; transactions in the sector closed with six gainers to four losers compared with two gainers to three losers recorded yesterday.


Petroleum marketing sector performance closed with one loser compared with two losers recorded yesterday.


The total transaction volume at the close of market session today inched up by +29.61% to close at 347.897 million units exchanged in 6,594 deals as against volume decrease by -22.62% recorded yesterday to close at 268.412 million units exchanged in 6,914 deals.


However, market value dipped marginally by -6.26% to close at N2.204 billion (US$14.725 billion) as against value growth by +18.45% recorded yesterday to close at N2.351 billion (US$15.709 million). Cadbury Nigeria Plc and National Salt Company of Nigeria (NASCON) topped the gainers chart for the day with price appreciation by +5%. However, Presco Plc topped the losers chart for the day with – 4.97% price depreciations.





The total volume traded in the shares of top five trades at the close of trading session stood at 180.796 million units valued at N788.945 million (US$5.270 million) exchanged in 1,214 deals. The volume and value of the top five trades for the day accounted for 51.97% and 35.79% of the market volume and value in that other.








research@proshareng.com, 00234-1-7624131, July 21, 2010; 1515hrs  



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