In this write-up, we will be looking at the performances of some stocks in the Nigerian stock market (NGX). We will identify the top gainers, key indices of assessment, stocks to watch out for this week, and key news events that influenced investors buying attitudes to inject new money into the stock market.
The week in review is week 5 of the year 2022. In the Nigerian stock market (NGX), the all-share index (ASI), which is the key instrument to assess the general performance of the capital market worldwide, was very positive as the index grew several times to hit a record number of 47, 329.80 bps.
It set a new record of 46,624.67 bps on Tuesday and another record of 47,111.21 bps on Wednesday, making it the new 52-week all-time high until 47,329.80 bps broke the previous record to become the new 52-week all-time high.
This shows the overall confidence domestic investors have placed in the Nigerian stock exchange.
What would have been the cause of this bullish trend?
Several things are responsible for this sudden surge of buying pressure on the domestic bourse.
- Financial Statements: Several companies issued financial statements last week. From MTN, AIRTELAFRIC, PRESCO, FLOURMILLS, RONCHESS, NIEMETH PHARMACEUTICAL, and a few of them. The majority of them posted impressive full-year financial results, with attractive profit after-tax results indicating dividend payments to retail and institutional shareholders. Moreover, most of these stocks witnessed acceptable price appreciation, thereby giving some secondary market participants a great opportunity to make a profit from the price appreciation of these stocks.
- Boardroom resolutions: Some of these companies, such as Grief Nigeria Plc, issued their executive board resolutions. These resolutions have a way of renewing confidence in the stock of the company in question and also cascading down to related or oftentimes non-related companies.
- Speculative events: Since capital value is built on the speculative attitude of securities traders, traders could make a buy or sell trade decision based on some events. For example, just on Friday, Okomu Oil released a statement about an attack on their farm by some unknown gunmen and the steps the company is taking to restore normalcy. These could have a negative or positive effect on the market value of the company; negative in the sense that traders might under-value the shares because they may be scared that the company might not release their financial statement. Positive in the sense that traders might be sympathetic to the company, which may push the price upwards to drive in the much-needed investment to help cushion the effect of the attack. So the market can react unpredictably sometimes.
- Director dealings: Though not strong enough to cause a major shift in the market direction for any share or equity market in general, they are still capable of driving momentum or staying still.
Who were the top gainers?
We used one major parameter to identify the best-performing stock. The parameter used was the percentage climb that was reflected in the stock growth value.
The top gainers are:
- Academy Press Plc, better known as ACADEMY on the NGX stock exchange, is an established printing company in Nigeria offering services for the printing of labels, calendars, company annual reports, books, magazines, and marketing material. The company offers additional printing-related services, which include the supply of graphic material, layout design, typesetting, artwork, photography, colour separation, and binding. The company is located at 28/32 Industrial Avenue, Ilupeju Industrial Estate, Lagos, Nigeria. The company was listed on the floor of the Nigerian stock exchange on June 15, 1995. The company started trading with an opening price of NGN0.94/UNIT and grew by exactly +29.01% during the week to close at NGN1.24/UNIT on Friday, February 4, 2022, making the company the toast of investors for week 5 of 2022. If Kelvin Mutual Trust Investment Company invested some portion of its mutual funds into Academy Press Plc (ACADEMY), let’s say the company bought 100,000 units at NGN0.94/UNIT in the secondary market on Monday, which in total would have been worth NGN94,000. On Friday, when the shares appreciated to NGN1.24/UNIT, the 100,000 units would be worth NGN124,000, thereby making the Kelvin Mutual Trust Investment Company NGN30,000. All of this happened in the secondary market, which is a market for already existing shares.
- CONOIL, came second as the company's share price appreciated by +19.75% throughout the week to close at NGN26.50 on Friday. The company appeared in the gainers chart twice.
- SCOA, came third as the company's share price appreciated by +19.27% throughout the week to close at NGN1.25 on Friday. The company also appeared in the gainers chart twice.
- RTBRISCOE: The company's share price appreciated by +18.33% throughout the week to close at NGN0.28 on Friday. The company appeared in the gainers chart twice.
The top losers are:
There were several losers in the NGX equity market, as the market had fewer downsides over the previous week. So mentioning them would put them in a bad light.
The equity market valuation situation
The market opened with NGN25,124.35 trillion and closed at NGN25,477.44 trillion, gaining NGN353.09 billion in the process. Most of this money came from the sales of some blue-chip stocks such as MTNN, ZENITHBANK, GTCO, SEPLAT, FIDELITYBANK, and PRESCO. These companies pulled in a lot of fresh investment.
For this week, we expect the upward trend to continue. We expect more fresh investment into the nation’s apex capital market. We expect companies such as FBNH, BUAFOOD, DANGCEM, and GTCO to play a more dominant role in the market. We also expect more financial statements to be released this week.
Finally, we expect companies like ACADEMY PRESS LTD to continue to attract more attention to the market.