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Although NGSE Trading Pattern Supports Uptrend, Correction Still Possible


Market Update for December 21 Monday’s trading activities on the Nigerian Stock Exchange (NSE) started on a volatile and positive sentiment for manufacturing stocks, as the benchmark All-Share index extended its bull-run for the sixth successive session and close higher on above average volume, amidst oscillating oil prices and rising case of coronavirus infections globally. Oil price stayed above the $50 per barrel pre-COVID price, despite oscillating on the second wave of the deadly virus, to remain above the government 2020 and 2021 budget benchmark price of $40. Monday’s rally was driven by high demand for Dangote Cement, Lafarge Africa, Flour Mills and PZ Cussons. The interest in shares of Dangote Cement may not be unconnected with the release of its share buy-back programme announced by the board before the market’s opening bell, as investors positioned, with the planned commencement of the first tranche involving the buy-back of 85.2m shares or 0.5% of the outstanding shares on December 30, 2020 and completion date slate for December 31, 2020. The ongoing Santa Claus rally is a signal that the year is coming to an end, and there are some important round numbers in the market, as the rising new cases of COVID=19 remain a threat to economic recovery efforts. The NSEASI has already broken out a strong resistance level of 37,000 marks, translating to 39.5% returns year-to-date, thereby outperforming inflation rate at 14.89%. Investors should target value and growth stocks and ride with the trend, ensuring like every smart investor that our NEWDEVCO 10 golden stocks for 2021 are in their portfolios, since these are stocks expected to drive the NSE’s ongoing V-shaped market recovery. The benchmark index just broke out major resistance levels to trade above all the moving averages on a daily and weekly chart. Investors and traders also should not underestimate correction at any time, because profit-taking is inevitable, even while the market has a trading pattern that supports an uptrend. The summary is: anything is still possible, considering the flat position of market breadth and low priced stocks topping the day trades in volume. Meanwhile, Monday’s trading opened in the upside on high buying pressure that was sustained throughout the session, as investors repositioned for year-end and corporate actions in 2021, factors that pushed the benchmark index to an intraday high of 37,494.76 basis points from its low of 36,798.74bps. Thereafter, the index closed higher than it opened at 37,443.40bps on a flat breadth. Market technicals were positive, but mixed, with volume traded higher than the previous day in the midst of flat breadth and high buying pressure as revealed by NEWDEVCO’s Sentiments Report showing 93% ‘buy’ volume and sell position of 7%. Total transaction volume index stood at 0.86 points, just as momentum behindthe day’s performance was relatively weak, with Money flow index looking up at 48.50pts, from the previous day’s 47.13pts, an indication that funds entered the market as funds are looking for higher returns and yields.

Latest News

Although NGSE Trading Pattern Supports Uptrend, Correction Still Possible
Market Update for December 21 Read More

--> CBN Announcement - Tue 21st of September, 2021 --> Bullish Sector Indices - Sun 24th of January, 2021 --> Index and Market Caps - Sun 24th of January, 2021

Although NGSE Trading Pattern Supports Uptrend, Correction Still Possible
Market Update for December 21 Read More

--> CBN Announcement - Tue 21st of September, 2021 --> Bullish Sector Indices - Sun 24th of January, 2021 --> Index and Market Caps - Sun 24th of January, 2021


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