Nigerian Equities Market Strong Recovery on Santa Claus Rally, Profit-Taking Worth N5.62 trillion in 12 months….


The Santa Claus rally extended to the last trading day of the year on a positive sentiment and buying interest in the final trading sessions despite profit taking activities, and as demand for blue-chip stocks, especially medium cap and other large caps, supported the gain.

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Thus, the benchmark index rallied for another seven consecutive weeks and broke the 49,000 resistance levels to 51,000 psychological mark to close the year.

At the close of the week, the benchmark index trended northward by 3.11% week on week to 51,251.06 points and closing the year with a positive index return of 19.98% year to date and a month to date gain of 7.5% in December.

Similarly, the market capitalisation of listed equities rose N841.5 billion across the three sessions this week to N27.92 trillion from N27.07 trillion in the prior week’s close and from N22.29 trillion at the start of the year.

This amounted to N5,618 billion profit for equities investors as the last seven weeks of 2022 saw the bull trend staying strong to aid the market’s recovery mode heading into another trading year.

The bulls took dominance of activities and buoyed by strong buying interests and positive price moments which prompted gains in GEREGU (+29%), WEMABANK (+21%), CHAMPION (+17%), PRESCO (+14%), AIRTELAFRI (+10%). Across the sectoral gauges

under our coverage, the performance was largely bullish across the major indices tracked except for the Banking sector which traded southward this and dragged by price declines in FBNH, FIDELITYBNK, and ZENITHBANK.

However, price appreciation in AIRTELAFRI, GEREGU, PRESCO drove the northward movement in the NGX Consumer Goods Sector by 4.85% week on week and was followed by NGX Insurance sector which gained 3.65% due to buying interest in CORNERST and AIICO.

In the vein, the Oil and Gas Sector advanced 2.39% week on week while the NGX Industrial Goods sector rose 0.14% week on week.

Meanwhile, the level of trading activities in the week came in strong as the total traded volume inched further by 118.4% week on week to 1.88 billion and the total traded value cleared higher by 94.04% week on week to N18.99 billion.

However, the total deals traded for the week plummeted again by 17.01% week on week to 12,035 trades for the week.

Looking ahead, the current trend is expected to continue on profit-taking and portfolio rebalancing ahead of the next earning season just as the market pullbacks add more strength to the upside potential of the index as we head into the new trading year.

However, we continue to advise investors to trade on companies’ stocks with sound fundamentals.

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