Daily Market Summary - February 28, 2025

Today, the Nigerian Stock Exchange (NGX) experienced a modest uptick, with the All Share Index (ASI) rising by 0.14% to close at 107,675.46. Year-to-date, the ASI has returned 4.50%, reflecting a steady recovery in market sentiment. Trading volume increased significantly to 452.22M, up 45.08% from the previous day, indicating heightened investor activity. However, market breadth remained negative with 28 advancers and 38 decliners, suggesting a mixed performance across sectors.

Significant Trends in Market Breadth:

• Market Breadth: The breadth ratio stood at 0.74x, indicating more decliners than advancers.
• Volume Trends: Trading volume was up for 67 listed companies while 70 saw declines, highlighting a selective interest in certain stocks.
• Turnover Increase: The market turnover surged to 12.64B Naira, suggesting increased trading activity, possibly driven by speculative trading or institutional repositioning.

Highlights of the Top Gainers and Losers:

• Top Gainers:
  • AUSTIN LAZ & COMPANY PLC (AUSTINLAZ): Closed at 2.09, up 10.00%. The stock's RSI of 57.92 indicates it is nearing overbought territory.
  • CAVERTON OFFSHORE SUPPORT GRP PLC (CAVERTON): Closed at 2.95, up 9.67%. The stock has shown strong momentum with a 62.84 RSI.
  • P Z CUSSONS NIGERIA PLC (PZ): Closed at 35.40, up 9.09%, with a robust 78.62 RSI, indicating strong bullish momentum.
• Top Losers:
  • NEWGOLD EXCHANGE TRADED FUND (ETF): Closed at 39,000.10, down -18.75%. The stock's RSI of 59.71 suggests it is not yet oversold.
  • LOTUS HALAL EQUITY ETF: Closed at 31.68, down -10.00%. The stock has been under pressure, reflected in its 46.88 RSI.
  • RED STAR EXPRESS PLC (REDSTAREX): Closed at 6.60, down -9.96%, with a high RSI of 92.23, indicating it may be overbought prior to this decline.

Insights and Predictions:

• Turnover Decrease Implications: The significant increase in turnover could indicate a shift in investor sentiment, possibly driven by news or earnings reports. Traders should monitor for potential reversals or continuations in trends.
• Advancing vs. Declining Stocks: The disparity in advancing and declining stocks suggests caution; investors may want to focus on sectors showing strength, such as consumer goods and logistics.
• Unusual Volume Movements: Stocks like ZENITHBANK and FCMB saw trading volumes significantly above their 90-day averages, indicating potential institutional interest or news-driven activity.
• YTD Trends: Notably, CAVERTON and PZ are both in the top gainers for the day and YTD, suggesting strong momentum that could continue if market conditions remain favorable.
• Bullish Momentum Stocks: Stocks like PZ and AUSTINLAZ are showing bullish momentum with RSI values above 70 and positive MACD crossovers, indicating potential for further gains.
• Bearish Momentum Stocks: NEWGOLD and REDSTAREX are showing bearish momentum with RSI below 30 and significant declines, suggesting caution for potential investors.

High Dividend Yield Stocks:

• P Z CUSSONS NIGERIA PLC (PZ): With a strong YTD performance and a solid dividend yield, it may attract income-focused investors looking for stability amidst volatility.

Suggestions for Traders:

• Opportunities: Consider positions in stocks with strong bullish momentum like CAVERTON and PZ. Monitor for potential pullbacks to enter at lower prices.
• Cautions: Be wary of stocks showing bearish momentum, particularly those with high RSI values that have recently declined, as they may continue to face selling pressure.

Year-To-Date (YTD) Gainers and Losers

Market Activity Summary

• Retail vs. Institutional: Retail investors accounted for 85.98% of trade counts but only 8.89% of trade value, indicating a focus on smaller trades. In contrast, institutional investors, while only 14.02% of trade counts, represented 91.11% of trade value, suggesting larger, more strategic trades.
• Top Traded Symbols:
  • Institutional: ZENITHBANK, MTNN, UBA, OANDO, ACCESSCORP.
  • Retail: UNIVINSURE, MTNN, ZENITHBANK, OANDO, ACCESSCORP.
• Patterns: The overlap in trading activity for ZENITHBANK and MTNN between retail and institutional investors suggests these stocks are currently in focus, possibly due to upcoming earnings or market news.

Conclusion

As we close out February, the market shows signs of resilience, but investors should remain vigilant. The mixed breadth and significant turnover increase indicate potential volatility ahead. Focus on stocks with strong fundamentals and momentum, while being cautious of those showing bearish trends. Happy trading!