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Last week, the local bourse sustained its lacklustre performance as the All Share Index shed 0.04% w/w to settle at 26,526.35 points. The weekly loss was driven by the negative closes recorded in 3 of the 5 trading days.

Accordingly, the YTD return worsened to -15.6% while market capitalisation fell by N3.6bn to settle at N12.8trn. However, investors sentiment as measured by market breath (Advancers/Losers) showed improvement as it improved to 1.4x from 0.4x in the prior week.

Over the last decade, the month of December has consistently recorded gains save for 2009, a phenomenon which has been referred to as “Santa Claus” rally. Based on historical data, we observed that the m/m gains in December averaged 2.97% over the last 10 years, with the highest monthly gain coming in at 6.47% in 2016 and the lowest was 0.02% in 2010.

Interestingly, 2019 appears to be a divergence from historical trends as the month to date loss stood at 1.76% as of 20 Dec, following the bearish sentiments observed on 11 of the 15 trading days in the month. As the highly anticipated Christmas season looms ahead, we ask the question “Will Santa Claus visit the local bourse?”

Although we expected that the directive of CBN in late October, which restricted individuals and local firms from investing in both its primary and secondary Open Market Operations (OMO) auctions will engender portfolio rebalancing activities towards risky assets as market participants search for high-yield dividend stocks, we note that the impact was short-lived as the gains recorded in November (2.4%) was not sustained in the current month.


[READ MORE: Rates continue to decline as banks struggle to meet CBN’s 65% minimum LDR)

Notwithstanding, we anticipate a mild rally in the remaining trading days, expected to be driven by year-end portfolio rebalancing activities as well as early positioning by early birds in high-yield dividend stocks with attractive entry points ahead of their FY 2019 earnings announcement. That said, we believe the anticipated bullish performance is unlikely to erase the current YTD loss, implying a second consecutive year of negative close for the Nigerian equities market.

Standard chartered



Standard chartered

Member of the Nigerian Stock Exchange,


First City Plaza, 44 Marina,

PO Box 9117,

Lagos State,




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