Stock Market Review: November 10, 2022

The Nigerian Capital market had a breath of fresh air yesterday has it gained after days of losses since the beginning of the week.

In a chat with Mr. Aruna Kebira, the M.D/C.E.O Global View Capital Limited, he shed light on why the market went up on Wednesday.

Excerpts:

The market was marginally up by 0.04%. What could be responsible? Should we expect the bull soon?

The stock market looked up on Wednesday following renewed buying interest in banking equities like Unity bank, Zenith bank, GTCO.

Also the market looked up and closed in the green, because Dangote cement that was driven down by 10% max on Tuesday, reversed during the trading session.

You can recall that Dangote cement is a member of the swoot (stocks worth over one trillion naira capitalisation). Any direction the constituents of this group goes, the all share index (ASI) goes.

The bull as a matter of fact is far from the market. The news emanating every day in the polity have no soft landing for the market.

The market will begin to look up after all these dusts have settled.

Unity Bank has been trending up in the past few days? What is driving the price up?

 I think the current upward trend in the price of unity bank is simply as squarely the run of the market.

Because in its q3 reports, it grew to 17.37k from 16.57k, signifying a growth of 4.8%. Speculation is the order of the day for the price of Unity Bank.

•What are the possibilities in Mutual Benefit Assurance, NAHCO, Champion Breweries, UBA, Dangote Cement, GTCO and Zenith Bank?

Mutual benefit from their q2 earnings release has shown a good recovery from their loss position, even this was further confirmed by their performance in their q3 results. But the market is not in that mood to compensate that kind of performance. But it is a stock to watch.

Nahco’s performance was sterling, and owing to the fact that it declared both bonus and dividend, the market moved to compensate it for it last quarter performance. It is a good stock to watch out for too.

Uba, GTco and Zenith also showed resilience in the face of this current headwinds. The prices at which they are trading is consider very cheap and any position taken at the current prices will not regret it when the market turns

•Honeywell Flour led other price decliners, shedding 9.09% to close at N2. How attractive is Honeywell?

 Honeywell has had its up and down in the market. I think the industry it belongs to is taking more than a bash from the current arms struggle between the Russia and the Ukraine. Therefore the price of their major raw material, wheat has gone through the roof and that is weighing seriously down on their performance. And market don’t see the light at the tunnel yet.

•Prestige, Presco and Jaiz Bank also emerged among top 5 price decliners. What could be the factor responsible for this?

 Presco happened to have been brought down closer to it 52 year low. It had been trading sideways and there was this 125,000 units that established it at #120.50.

It is just forces of the market. It has nothing to do with their performance.

Prestige and Jaiz bank are also in the same boat. The effect of demand and supply

•Is Presco a good buy at N120.5?

The closer the price of a stock, especially a performing one, get closer to its 5 weeks low, the more attractive it becomes.

But the problem we have with most investor is that as you continue to preach to them to buy at this level, they won’t hear but when the market turn and stocks like Presco move to catch up with their 52 week high prices, they will be regretting it.

Presco is good to go at this current price.

•According to NBS, Nigeria’s public debt stands at N42.84 trillion. How will this affect the economy and the capital market?

Public debt!

The current state of the market was occasioned from news of this type. The market is already aware and that information is already factored in the market.

Even if the quantum of the debt continues to escalate, the market is already aware that the country is indebted to the public.

That may not constitute any stimulus, whether positive or negative to the current state of the market.

Source: Stock Market Review: November 10, 2022 – StocksWatch (stocksng.com)

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