Stock market review: January 16, 2023

The Nigerian stock market last week closed on a positive note with 2.52% growth, week on week.

Year to date, the market has returned 2.46% with the All Share Index and Market Capitalisation at 52,512.48 points and N28.602 trillion respectively.

In a stock market review with Mr Gilbert Ayoola, the following were discussed:

Excerpts:

The market last week grew by 2.52%, week on week. What could be the factor responsible for this significant growth?

Recent activities in the equities market has continued to improve based on investors positive sentiments in sound fundamental stocks on Q3 results, having price rising in anticipation for Q4 earnings towards expectation of price appreciation and declaration of dividends therefore pushing the market to close on upward swing trend.

When compared on week-to-week performance, many of these stocks however have continued to fare better in their returns on renewed buying interest leading to price movement and increased growth.

Likewise, i believe that high level of liquidity in the financial system in the first quarter of 2023, have continued to significantly impact changes in the market following CBN’s directive on the use of old naira notes till January 31.

Insurance stocks were among those that dominated gainers last week. What is driving the current vibration in the insurance sector?

Market participation in the insurance stocks are driven by bargain hunters taking position due to the low price cheap stocks in equities like Prestige Assurance, Linkage, Regency Assurance on high demands which were actively traded on the Nigerian Bourse driven by +0.95 percent increase in NGX Insurance Index to close positive on the last day of trading on Friday, January 13, 2023.

What is driving the growth in the price of MTN?

The growth witnessed in MTN is as a result of renewed positive sentiment by investors, and recent corporate action of management of the company’s board in consideration of it financial reports of Q4 results and MTN is known for declaring good dividend in rewarding its shareholders.

More so, at the price of N229.90 when compared with the highest price peak in 2022 at N270/share is still currently under-priced considering the nine months performance growth of 20.71% year-on-year in its gross revenue to N1.456 trillion.

What are the possibilities in NAHCO, Wema Bank and WAPCO?

For NAHCO, the possibilities is that price could inch higher upwards on the fact of further demand which is still below its 52-weeks high.

Wema Bank continues to look promising, showing resistance following its recent share reconstruction having a significant 51.17 percent growth year-on-year (y-o-y) to N95.354bn in Q3 2022 from N63.077bn recorded in previous year 2021.

Similarly, WAPCO has currently surpassed its 52-weeks price high from N25.30, setting a new time price position at N25.50/share.

What are the stocks to watch?

For the new week, investors should continue to consider stocks like; Dangote Cement, Nigerian Breweries, MTN, Mutual Benefit, FBNH, AllCO, Zenith Bank, GTCO and many others.

Source: Stock market review: January 16, 2023 – StocksWatch (stocksng.com)

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