Stock Market
U.S Stocks close lower, as Facebook, Amazon, Google drop 2%
Recent sell-offs were triggered by leading tech brands including Facebook, Amazon, Google.
U.S Stocks closed lower at the last trading session for the week after a volatile session. These recent sell-offs were triggered by leading tech brands such as Facebook, Amazon, and Google, which lost more than 2%. Netflix’s stock price lost 1.8% and Microsoft also dropped 1.4%.
However, Apple’s stock price ended the trading session up by 0.1% after falling as much as 8.3%. Tesla’s share price also reversed a drop of more than 8%, ended the trading session up 2.8%.
READ: Nigerian billionaires lose billions amid COVID-19 pandemic
The Dow Jones Industrial Average closed 159.42 points lower, or 0.6%, at 28,133.31 points. At one point, the 30-stock average fell as much as 628.05 points or 2.2%. The Dow was also higher for a moment yesterday.
The S&P 500 dropped 0.8% to 3,426.96 but finished well off its session low. The broader-market index plunged by 3.1% at its session low and briefly traded positive on the day. The Nasdaq Composite also dropped 1.3% to 11,313.13 but also closed well above its low of the day.
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In an explanatory note to Nairametrics Stephen Innes, Chief Global Market Strategist at AxiCorp spoke on the prevailing market conditions and the macros triggering the sell-offs. He said;
“This sell-off looks an awful lot like a retail meltdown, similar to what we see in China markets as a lot of weak retail longs getting taken to the cleaners by the aggressive short seller on the street in a vast momentum style clean out, but I think there is more than meets the eye.
“While I don’t think it’s a healthy meltdown, getting rid of some of the short-term speculator froth will offer up better levels for the Wall of Money to indulge as we know the Fed is going anywhere soon, although probably holding back the big guns for a possible rainy day in the future if the winter months prove to be explosive for the virus.”
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However, there appears to be no particular driver of the recent sell-offs recorded in the world’s largest equity markets other than a reversal of the substantial gains seen over the past two weeks on the surface.
Exclusives
Lafarge, Nigerian Breweries, Stanbic IBTC, others top best performing stocks in Q3 2020
Nairametrics reviews the best stocks in Q3 2020, judging by their performance.
Lafarge Africa, Nigerian Breweries, Stanbic IBTC, United Capital, and FTN Cocoa made the list of best-performing stocks in the third quarter of 2020 (July – Sept’20).
The third quarter of the year was a recovery period for the Exchange, as the All Share Index grew by 9.61% to close the gap caused by the negative performance it endured in the first quarter of the year – during the heat of the COVID-19 pandemic. It also recorded a 14.92% positive growth in the second quarter.
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As Company stocks is one of the popular means of short-term investments in Nigeria and a look at persistent inflationary pressures; it is imperative to assess the performances of the stocks listed on the exchange during the covid era, to ascertain the profitability of investors in this period.
To determine the best-performing stocks, we looked at the stock prices as of the last trading day in June 2020 and compared to their prices as of the last trading day of September 2020. Here are the top 5:
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Lafarge Africa Plc
The Cement manufacturing company grew its stock value by as much as 50% between July and September 2020. As at 30th June 2020, the stock of Lafarge was worth N10 per unit of share but grew to N15 as at the last trading day of September – with a market capitalization of N241.6 billion.
A cursory look at the Q2 2020 financial performance, shows a 5% year-on-year decrease in revenue generated. However, a reduced cost of sales helped improved the company’s gross profit by 10% and a subsequent 78% increase in profit before tax at N19.38 billion.
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June 30th – N10
September 30th – N15
Return – 50%
Ranking – First
Nigerian Breweries Plc
The second on the list is the brewery giant, Nigerian Breweries – the makers of Star Lager, Fayrouz, Goldberg, and many other consumables. It grew its stocks by 35.73% from N36.1 as of 30th of June to N49 per share at the end of Q3 2020. The market capitalization also closed at N391.8 billion as at the review period, being the second most capitalized consumer goods firm – only behind Nestle Nigeria.
A look at the Q2 2020 financials, shows that the company endured a downturn, mostly affected by the COVID-induced lockdown, which halted all social gatherings, as it posted a profit before tax of N69.8 million – 99% decline compared to N7.95 billion recorded in the corresponding quarter of 2019.
However, with the lifting of lockdown nationwide, the outlook for the Q3 and Q4 2020 appears to be positive, as investors have shown confidence in the brand, which has translated into a positive stock performance in the quarter.
READ: GDP: Nigeria’s manufacturing sector on tight ropes
June 30th – N36.1
September 30th – N49
Return – 35.73%
Ranking – Second
Stanbic IBTC Plc
The third most capitalized bank on the stock exchange is also the third on the list of best performing stocks in Q3 2020, growing its stock by 33.88% from N30.25 per unit of share recorded as of June 30th to N40.5 at the end of trading in September – with a total market capitalization of N449.8 billion.
In the same vein, the Q2 performance of Stanbic IBTC indicates an 11% increase in gross earnings, which permeates into 32.2% increase in profit before tax – from N21.1 billion recorded in Q2 2019, as against N27.9 billion in the review period.
READ: Heineken scoops more Nigerian Breweries shares in insider disclosure
June 30th – N30.25
September 30th – N40.5
Return – 33.88%
Ranking – Third
United Capital Plc
The financial and investment service firm recorded a 30.59% increase in its stock value, as it moved from N2.55 per unit of share as at June 30th to N3.33 as at the end of September. This growth places United Capital in fourth position, as one the best performing stocks between July and September 2020.
The investment firm displayed firm resolve against the effects of COVID-19 in the second quarter of the year – as it posted a profit before tax of N1.5 billion, as against N1.2 billion reported in the corresponding quarter of 2019. This indicates a 22.9% increase in profit.
READ: Custodian Investment Plc posts Profit After Tax of N1.5 billion in Q3 2020
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June 30th – N2.55
September 30th – N3.33
Return – 30.59%
Ranking – Fourth
FTN Cocoa Processors Plc
A unit of FTN Cocoa shares was valued at 20 kobo as at June 30th. However, it grew by 30% to N26 kobo as at the end of trading on 30th September 2020, leaving its total market capitalization at N572 million.
Data obtained from Nairalytics – the research arm of Nairametrics, showed that FTN Cocoa has not released its financials since Q1 2019. However, the cocoa processing company was able to post a positive stock performance in the third quarter of the year to sit fifth on the list.
READ: Nigeria’s manufacturing sector contracts for 5th consecutive month – CBN
The company was formerly registered as Fantastic Traders Nigeria Limited, a Limited Liability Company, which was incorporated in 1991. It commenced cocoa processing business in a third-party arrangement (Toll Processing) with Stanmark cocoa processing company limited in 1995. They converted cocoa beans into cocoa butter and cocoa cake/powder, and later extended their activities to Ile-oluji, Cocoa Cooperative etc.
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June 30th – N0.20k
September 30th – N0.26k
Return – 30%
Ranking – Fifth
Bubbling Under
The following stocks make up the rest of the top 10 in descending order:
6. Guaranty Trust Bank Plc
7. University Press Plc
8. Eterna Plc
9. Unity Bank Plc
10. Fidson Healthcare Plc
Explore some Advanced Financial Calculators on Nairametrics
Bottom line: With a double-digit growth in the following stocks, Investors who bought these stocks would be delighted to see their investments appreciate during this period and will look forward to gaining more in the subsequent periods.
Stock Market
Nigerian stocks on steroids, investors on hat trick
Market breadth closed positive as NESTLE led 41 Gainers as against 5 Losers topped by ROYALEX.
Stock Market
GTBank, Cadbury, keep Nigerian Stocks fired up, Investors gain N105.76 Billion
Market breadth closed positive as LINKASSURE led 46 Gainers as against 2 Losers topped by WEMABANK
Nigerian Stock Market ended the Tuesday trading session on a bullish note.
The All Share Index gained by 0.28% to close at 28,777.96 basis points as against +0.28% appreciation recorded previously. Its Year-to-Date (YTD) returns currently stand at +7.21%, and investors gained 105.76 Billion.
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- Nigerian bourse trading turnover also ended positively as volume ticked up by +20.44%, as against the +20.44% uptick recorded in the previous session.
- FBNH, ACCESS, and FIDELITYBK were the most active to boost market turnover. CILEASING led the list of active stocks that recorded an impressive volume spike at the end of today’s session.
- Market breadth closed positive as LINKASSURE led 46 Gainers as against 2 Losers topped by WEMABANK at the end of today’s session – an improved performance when compared with the previous outlook.
READ: Why you should avoid investing long term in Nigeria’s stock market
Top gainers
- FLOURMILL up 9.50% to close at N26.5
- CONOIL up 9.81% to close at N17.35
- CADBURY up 9.21% to close at N8.3
- GUINNESS up 5.63% to close at N16.9
- GUARANTY up 1.96% to close at N31.25
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Top Losers
- WEMABANK down 1.72% to close at N0.57
- NEM down 1.46% to close at N2.03
- DEAPCAP flat to close at N0.27
- UNIONDICON flat to close at N10.95
- MOBIL flat to close at N178.3
READ: Nigerian bourse close flat, triggered by low market liquidity
Outlook
Nigerian Stocks were all fired up at Tuesday’s trading session. The surge is partially attributed to the leading blue-chip stocks that includes GTBank, Cadbury, Conoil, and Flour mills.
- Buying pressure got intensified as Nigeria’s major export earning – crude oil recorded impressive gains amidst the falling US dollar.
- Nairametrics, however, advises that you seek to buy stocks from a certified stockbroker, as some local equities exhibit cyclic returns.
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Lafarge, Nigerian Breweries, Stanbic IBTC, others top best performing stocks in Q3 2020
