The Nigerian stock market on Monday closed on a positive note with 0.92% growth. Year to date, the market has returned 0.86% with the All Share Index and Market Capitalisation at 51,693.08 points and N28.156 trillion.
In a stock market review with the MD/CEO of Global View Capital Limited, Aruna Kebira, the following were dicussed:
• The market closed on Monday on a positive note with 0.92% growth. Should we expect more bulls this week?
The closing of the market high was supported by the over 5% gain in Airtel Africa which was just going back to its previous position before January 5.
A desperate seller caused the stock to lose 10% maximum for that day and the market is moving to return it to that price
That is not to say that other stocks did not gain but the weight of Airtel Africa is very substantial in the market.
I see the week closing bullish as most companies are releasing to the market their closed periods and notices of Board meetings.
• What is driving the price of Airtel?
Like I said above, the price of Airtel Africa dropped by a maximum of 10% on Thursday, January 5, 2023, most probably by a desperate seller and the stock is going back to the price it was dropped from.
Airtel Africa as we know has a dual listing and pays both interim and final dividends and because we are approaching the earnings season, the market will not just allow any how pricing for the stock, hence the market has moved to reprice it.
• How attractive is UCAP at N15?
UCAP has over the years surprised market operators and analysts alike. It has just moved form its last 52-week high price of N14.15 to N15.00.
The best we could hope for is that their earnings will be commensurate with this increase in the price and also that their declared dividends will be able to support the price.
Any contrary situation will see the stock coming back to its previous price axis
• Why is Wema Bank trending down?
We are in a market where every participant is sitting on an edge. Investors these days would prefer to coast home with a marginal gain rather than a loss.
What we are seeing in Wema Bank decline in price is purely profit taking, but after that the price will surely reverse
• What are the possibilities in Flour Mills, NAHCO and GTCO
Flourmills has been a stock that trades in the neighbourhood of N40.00. The issue with the stock has been the prime raw material, Wheat. The scarcity and increase in the price of the commodity has been the albatross of the flour mills in the country.
Besides that, FMN is a good stock
NAHCO declared a dividend of N0.41 and also bonus of 1 for 5 and those benefits had been factored into the price of the stock.
Except there is another surprise from the company in the form of better dividend, because their current earnings will be affected by the increase in the outstanding shares, the price might just be sticky about its current price.
The market is eagerly waiting for the release of the unaudited result form GTCO to determine whether they have actually overcome their earlier challenges.
Remember that the bank has been releasing declining earnings up until Q3 2022.
But because it is still certain that dividend in the neighbourhood of N2.70 is coming from the bank, it is a stock to keep an eye on.
• What are the stocks to watch?
Guinness, Okomu Oil, Julius Berger, Fidelity, MTN and Dangote Cement