Mid-Week: Nigerian Big CAP stocks hit as price correction sets in
Category: Investors NewsBeat
Profiteering dominates Nigerian bourse as price correction takes its toll across the board while equities shed weight accordingly amid low optimisms witnessed so far in the week.
Also, market maintained below-the-line posture on back of weak bargain posture paraded by investors while the market breadth succumbed to profit-taking tendency and unrelenting sell pressure to close negative- the outlook recorded so far in the week came in-line with our position as envisaged in our previous mid-week analysis report.
More so, the market volatility gained more dominance as investors assumed speculating trading pattern considerably- This is likely to stoke the price correction further.
Mid-week analysis revealed retracement as envisaged last week, following the prolonged overbought posture of the market as revealed by market RSI while sentiments turned negative.
Nevertheless, improved risk appetite was observed as investors engaged in speculative trading significantly, particularly towards the value and active penny stocks despite the overwhelming profit-taking tendency observed mainly towards blue chip stocks and heavy counters.
Furthermore, the market volume turnover sustained negative posture while the naira votes significantly plunged as more heavy counters shed weight led by Mobil Plc.
In our opinion as revealed by extensive analysis, market is still trading within overbought region while price correction likely to extend, following the low market optimism observed so far in the week.
At the end of the today’s session, technical analysis revealed sustained weak bargain posture as market witnessed pessimistic trading across sectors so far in the week while market turnover closed negative.
Market closed with WTD performance of -1.52% loss- unimpressive performance and decline in market optimism was observed when compared with previous mid-week performance of 0.16% gain while YTD performance stands at 11.75% as against 12.54% recorded in the previous week.
The profit taking and pessimistic activities witnessed towards blue chips and big CAP stocks in Industrial Goods, Consumer Goods, Oil & gas and Finance, sectorscontributed to the market outlook so far in the week.
The Stocks on the Hunters’ Radar
Investors’ Trading pattern and psychology:
The trading pattern suggests increased speculative tendency while the profile of top 10 stocks on the investors’ radar reveals increased risk appetite as majority of the stocks are penny stocks while International Brewery Plc is the only medium priced stocks that made top ten stocks on the investors’ radar.
Analysis of investors’ radar (gainers’ list) revealed increased speculative tendency due to improved bargain drive towards penny stocks while high and medium priced stocks sustained weak patroange.