Investors shift to penny stocks as decline continues

Investors shift to penny stocks as decline continues - Printable Version

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Investors shift to penny stocks as decline continues - Edoman - 02-05-2020

Investors shift to penny stocks as decline continues
February 5, 2020

in Equities

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Investors appeared to be making strategic shift to dividend-hunting among low-priced stocks as the bearishness at the Nigerian equities market continued to mitigate share prices of most large and mid-cap stocks.

With more than three decliners to every advancer, the overall market situation at the Nigerian Stock Exchange (NSE) was overtly negative. Benchmark indices for the stock market closed with average decline of 0.35 per cent, equivalent to net capital depreciation of N52 billion. The continuing price depreciation depressed the average year-to-date return to 5.92 per cent.

The All Share Index (ASI)- the common value-based index that tracks share prices at the NSE declined from its opening index of 28,533.40 points to close at 28,432.27 points. Aggregate market value off all quoted equities dropped from its opening value of N14.697 trillion to close at N14.645 trillion.

With 23 decliners to seven advancers, all sectoral indices closed negative, underlining the widespread selling sentiments at the market. The NSE Banking Index dropped by 1.09 per cent. The NSE Consumer Goods Index declined by 0.82 per cent. The NSE Insurance Index depreciated by 0.65 per cent. The NSE Oil and Gas Index dipped by 0.18 per cent while the NSE Industrial Goods Index slipped by 0.08 per cent.

Low-priced stocks dominated the gainers’ list. Union Bank of Nigeria led with a gain of 60 kobo to close at N6.60. Julius Berger Nigeria followed with a gain of 30 kobo to close at N21.50. Law Union and Rock Insurance rose by 7.0 kobo to close at 84 kobo. WAPIC Insurance added 3.0 kobo to close at 33 kobo. Transnational Corporation of Nigeria chalked up 2.0 kobo to close at 99 kobo while Cornerstone Insurance and Lasaco Assurance inched up by one kobo each to close at 60 kobo and 27 kobo respectively.

On the negative side, CAP led the losers with a drop of N2.40 to close at N22.60. Dangote Sugar Refinery followed with a loss of N1.35 to close at N12.45. Zenith Bank dropped by 70 kobo to close at N19.20. UAC of Nigeria lost 45 kobo to close at N8.50. Guaranty Trust Bank declined by 40 kobo to close at N29 while Ecobank Transnational Incorporated lost 25 kobo to close at N7.20 per share.

Total turnover stood at 254.86 million shares valued at N3.04 billion in 5,199 deals. Zenith Bank was the most active stock with a turnover of 68.48 million shares worth N1.31 billion. FBN Holdings followed with a turnover of 32.66 million shares worth N193.69 million. Access Bank placed third with 28.83 million shares valued at 28.83 million shares valued at N259.55 million. United Bank for Africa recorded a turnover of 23.63 million shares worth N174.62 million while Guaranty Trust Bank placed fifth with 13.27 million shares valued at N384.7 million.

“For the rest of the week, we expect corporate earnings release to dictate the direction of the equities market,” Afrinvest Securities stated