NSE ASI bows to rout in Industrials
What shaped the market today?
· The NSE ASI halted its three-day rally at week close, down -233bps, as a sharp reversal in the Industrial Goods sector wiped out gains across other key sectors. Global markets traded mostly higher after U.S non-farm payroll data for August came in short of expectations (151,000 new jobs were added against an expectation of 180,000), signaling a potential limiting factor to a possible rate hike by the U.S Fed.
· The Industrial Goods Sector (-532bps) solitarily pulled the ASI under water following quick profit taking in DANGCEM (-785bps) and decline in WAPCO (-276bps). All other key sectors however maintained positive momentum with the Oil & Gas (+112bps) leading the charge following gains in SEPLAT (+500bps) and TOTAL (+79bps). The Financial Services (+97bps) and Consumer Goods (+18bps) sectors were next in line, thanks to advances in WEMABANK (+870bps), FCMB (+748bps), GUARANTY (+204bps), CADBURY (+429bps) and DANGSUGAR (+78bps).
· Market breadth remained positive with 23 advances and 15 declines.
What will shape the next trading session?
· Noting that the sharp reversal witnessed in today’s session was singlehandedly driven by the Industrial heavyweights, we believe market sentiment remains strong (citing positive market breadth and volume traded) and could muster a market turnaround at week open.
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