World stocks bullish on increased spendings, as Nigerian stocks look downcast

Performance in developed markets and amongst Brazil, Russia India, China and South Africa (BRICS) were bullish was a result of proposed increased spendings in the United States of America and the continuous accommodative monetary policy by the European Central Bank. But performance on the floor of the Nigeria stock market and that of most African countries looked downcast at the close of trading activities last week.
In Nigeria, the bears dominated the scene last week, with the All Share Index (ASI) going down by 0.2 per cent week-on-week (w/ w).
Despite halting a 9-sessions losing streak to gain 56 basis points (bps$on Friday, the All-Share index declined by 0.2 per cent w/w to 38,256.99 points thereby extending last week’s loss.
Market capitalisation fell by N35.0 billion to N19.9 trillion while Year-To-Date (YTD) loss worsened to -5.0 per cent. Activity level reduced as average volume and value traded fell by 1.0 per cent and 18.0 per cent to 207.5 million units and N1.9 billion respectively. The most traded stocks by volume were ZENITH (63.3 million units), SOVERENINS (53.9 million units), and FIDELITY (50.4 million units) while ZENITH (N1.5 billion), GUARANTY (N905.3 million), and UACN (N411.6 million) led by value.
Performance across sectors under our coverage was mixed as three indices gained while the remaining three indices recorded losses. Leading the gainers are the Insurance, Oil & Gas, and AFR-ICT indices which appreciated by 1.0 per cent, 0.9 per cent, and 0.3er cent w/w respectively on the back of buying interest in REGALINS (+44.1 per cent), SOVERENIN (+11.5 per cent), SEPLAT (+0.9 per cent), OANDO (+3.4 per cent), and MTNN (+0.6 per cent). On the other hand, the Banking index led the laggards, down 1.8 per cent w/w due to losses in GUARANTY (-4.3 per cent) and ETI (-2.8 per cent). Similarly, the Industrial and Consumer Goods indices declined by 0.4 per cent and 0.1 per cent w/w respectively on the back of price depreciation in BUACEMENT (-3.0 per cent), FLOURMILL (-5.1) per cent, and NESTLE (-1.4 per cent).
But in the developed markets, in the midst of the uncertainty associated with the pandemic, the European Central Bank has pledged continuous accommodative monetary policy. Elsewhere in the US, available economic data reveals slowing jobless claims for the fourth consecutive week and signs of economic recovery. President Joe Biden is proposing a $6tn budget for 2022 fiscal year, representing the highest sustained federal spending since World War II.
These moves have increased investors’ confidence so much. The result is the bullishness in the markets.
Performance in the developed markets was impressive as all indices gained w/w. In the US, the S&P 500 and NASDAQ indices gained 1.4 per cent and 2.6 per cent w/w respectively. In Europe, the FTSE All-Share, France CAC 40 and Germany’s XETRA DAX indices all gained 0.3 per cent, 1.5 per cent and 0.5 per cent w/w respectively. Hong Kong’s Hang Seng and Japan’s Nikkei 225 indices appreciated 2.3 per cent and 2.0 per cent w/w in that order.
Performance across the BRICS markets mirrored that of the developed markets as all indices appreciated. India’s BSE Sens index gained the most by 4.4 per cent w/w despite worsening infection rates. China’s Shanghai Composite index trailed with a 4.3 per cent gain owing to waning inflation fears and strengthening currency. Russia’s RTS index also advanced 2.2 per cent w/w while South Africa’s FTSE/JSE All-Share and Brazil’s Ibovespa indices gained 2.0 per cent w/w apiece.
In Africa, performance was mixed as three of six indices under our coverage closed lower w/w. Egypt’s EGX 30 and Mauritius’ SEMDEX indices led the laggards, down 1.6% and 1.2 per cent w/w respectively. Nigeria’s All-Share index also lost 0.2 per cent w/w. On the flip side, Ghana’s GSE Composite index gained 0.4 per cent w/w to lead the gainers. Similarly, Morrocco’s Casablanca MASI and Kenya’s NSE 20 indices gained 0.2 per cent apiece w/w.
Across the Asian and Middle East markets, performance was bullish as only Turkey’s BIST 100 index declined 2.1 per cent w/w. Thailand’s Set and Saudi Arabia’s Tadawul All Share indices recorded respective w/w gains of 1.8 per cent and 1.7 per cent. In the same vein, Qatar’s DSM 220 and UAE’s ADX General indices appreciated 0.6 per centand 0.5 per cent w/w respectively.

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