Monday, December 09, 2019 / 10:10 AM / by Afrinvest Research / Header Image Credit: Afrinvest
Market Last Week (Our Observations)
- Last week, the domestic bourse ended on a bearish
note following slight profit taking after four weeks of successive gains.
Consequently, the All-Share Index shed 0.5% to close at 26,855.52 points
while YTD return worsened to -14.6%. Similarly, investors lost N218.2bn
as market capiltalisation depreciated to N13.0tn.
- Sector performance was bearish as all indices
under our coverage lost save the Consumer Goods index which gained 1.7%
w/w. The Industrial Goods index lost the most while the Banking and Insurance
indices also shed 1.2% and 0.9% respectively. Similarly, the AFR-ICT and
Oil & Gas indices lost 0.9% and 0.4% respectively.
- ROYALEX (+17.4%),
UNILEVER (+17.4%) and NIGERINS (+10.0%)
led gainers while CORNERSTONE (-20.3%), ARBICO (-9.8%)
and IKEJAHOTEL (-9.7%) led losers.
Market This Week (Our Expectations)
- The Afrinvest Weekly Sentiment Indicator weakened
to 1.7 points from 2.4 points recorded in the previous week.
- This week, we expect investors to cherry-pick
stocks with sound fundamentals.
Weekly Stock Watch for Technical Traders
Market Analysis... Domestic Equities
Market Halts Bullish Run
Last week, the local bourse closed on a negative note, bringing a halt to the
four-week bullish trend as the NSE All-Share Index fell 0.5% W-o-W to close at 26,855.52 points. The
negative Directional Movement Index (-DMI) outperforms the positive Directional
Movement Index (+DMI) and maintained a strong ADX (Average Directional Movement
Index), indicating a possibility that the NSE-ASI may continue to shed gains
Our BUY Recommendation
Observations from last week revealed
that WAPCO (ADX: 48.93; MFI: 0.00; %B: 24.15), NIGERIAN BREWERIES
(ADX: 32.55; MFI: 10.90; %B: 61.93), OANDO
(ADX: 26.34; MFI: 14.59; %B: 26.41), DANGCEM
(ADX: 31.90; MFI: 30.84; %B: 22.79), CUTIX
(ADX: 26.76; MFI: 55.66; %B: 78.28) all have prospects for gains this week.
These tickers currently hover around the oversold region with their +DMI outperforming -DMI with >25 ADX values, indicating a strong trend.
However, buyer's discretion is advised!
Our SELL Recommendation
Our observation also suggests that JBERGER (ADX: 36.11; MFI: 97.88;
%B: 57.54), FLOURMILL (ADX: 44.61; MFI: 97.60; %B: 83.24), CUSTODIAN (ADX:
32.36; MFI: 93.69; %B: 57.54), and SEPLAT (ADX: 34.54; MFI: 86.21)
are the tickers most likely to record losses. These stocks are on the downtrend
with â€“DMI outstripping +DMI and strong ADX values (>25). Our potential top
loser, which is closest to the overbought region with a high ADX is SEPLAT.
- NB: Rate
on N100M and above are negotiable and all
rates are valid ONLY for fund received on/before 9th December 2019.
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