Investdata Weekly Sentiment Reports

NSEASI buy 19% sell 81% MFI 35.30
Access buy 0% MFI 19.26
Afrprud buy � MFI 48.07
Aiico buy 40% sell 60% MFI 41.00
Caverton buy � volume index 1.99 MFI 45.33
CCNN buy 89% sell 11% MFI 87.73
Dangote Cement buy 7% sell 93% volume index 0.70 MFI 45.50
Dangote flour buy 38% sell 62% MFI 24.94
Dangote sugar buy 13% sell 87% MFI 44.78
Diamond buy 0% MFI 16.27
Eterna buy � volume index 1.63 MFI 66.92
Fbnh buy 93% sell 7% MFI 32.20
Fcmb buy 50% sell 50% volume index 1.73 MFI 67.84
Fidelity buy 78% sell 22% MFI 20.78
Fidson buy 93% sell 7% MFI 95.11
Fmn buy 0% MFI 54.73
Fo buy 2% sell 98% volume index 0.71 MFI 46.25
GT buy 7% sell 93% volume index 2.90 MFI 36.78
Hony flour buy 33% sell 67% MFI 16.28
Lasaco buy 67% sell 23% volume index 1.89 MFI 36.13
Lvstk buy � MFI 22.11
Transcorp buy 18% sell 82% MFI 12.10
Uacn buy 0% MFI 54.04
Uba buy 33% sell 67% MFI 71.80
Ubn buy � MFI 31.99
Wema buy 20% sell 80% MFI 14.76
Zenith buy 94% sell 6% volume index 1.04 MFI 47.70

http://investdataltd..com/2018/05/investdata-weekly-sentiment-reports_14.html

I Need Your Help on This



Thank you for been there and well appreciated patronage.

In addition, we also appreciate your word of mouth which has help spread our services all over the globe. No amount of advertising can commensurate you as our no1 advocate

So in the quest to improve on our quality of service to serve you best, help fill out the below form by clicking on the below link. It won't take more than 2 minutes of your time.

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Happy Trading,
Ambrose Omordion

FAIR VALUE

Fair value is the sale price agreed upon by a willing buyer and seller, provided both parties enter the transaction freely and knowledgeably.

Fair value is also the value of a company’s assets and liabilities when a subsidiary company’s financial statements are consolidated with a parent company.

The most reliable way to determine investment’s fair value is to list the security on an Exchange. Assuming a stock trades on an exchange, market makers provide a bid and ask price for the stock. An investor can sell the stock at the bid price to the market maker at the ask price.

Investdata Academy
http://investdataltd..com/2018/05/fair-value.html

Investdata Daily Sentiment Reports


NSEASI buy 3% sell 97% MFI 61.77
Access buy 0% MFI 88.11
Aiico buy 67% sell 33% volume index 3.52 MFI 51.03
Ccnn buy 0% volume index 0.97 MFI 97.35
Dangote Cement buy 0% MFI 86.20
Dangote flour buy 0% volume index 1.55 MFI 25.79
Fbnh buy 0% MFI 52.82
Fcmb buy 93% sell 7% MFI 18.17
Fidelity buy 0% MFI 25.88
Fmn buy MFI 67.01
Okomu buy 0% volume index 2.14 MFI 89.67
Transcorp buy 0% volume index 0.74 MFI 36.02
Uacn buy 0% volume index 1.32 MFI 10.85
Uba buy 67% sell 33% volume index 1.57 MFI 76.68
Zenith buy 57% sell 43% MFI 66.35

http://investdataltd..com/2018/05/investdata-daily-sentiment-reports_15.html

Is Stock Education a Continuous learning?

There are no secrets to success. It is the result of preparation, hard work, and learning from failure. Colin Powell

I can categorically say that all discipline is a continuous learning because things tends to change over time. However, their degree of learning vary. In law, you just have to be studying at all time because it is the only to keep up with the discipline. In fact it is a pre-requisite for excellence.

However, this is not different from the stock market because it is determined by policies, decisions, political and economy consciousness of people.

Hence, it is highly recommended that you keep yourself with knowledge regarding the NSE and study current working models and strategies. But, models and strategies change; even a change in govt has a large effect on the market.

Despite, the idea of constant study cannot be over-emphasize, the basics still remains the same. So the question is Do you know the fundamentals? Do you know the Technical?

Happy Trading,
Ambrose Omordion
http://investdataltd..com/2018/05/is-stock-education-continuous-learning.html

Investors Await Impact Of Positive Economic Indicators On Nigerian Bourse


Market Update for May 14, 2018

Trading for the third week of May started on the Nigerian Stock Exchange (NSE) on a negative note, reversing the gain recorded in the previous session as losing momentum heightened with corrective wave extending on a low traded volume, just as investors sentiment was further weakened.
The session opened on a little gap down which widened by the mid-morning as sell offs in medium and high cap stocks persisted till midday, extending to the afternoon on a weak mood that made intraday lower lows of 40,667.46 basis points, from a high of 41,029.79bps. It eventually finished at 40,677.61 to close the day.

The five-month downtrend of Nigeria’s equity market supports a reversal on the back of low valuations arising from healthier companies as shown in their 2017 full-year and Q1 outings. This is supported by the fact that the nation’s economy is still in recovery mode, helped also by rising crude oil prices and improving consumption level expected to trigger market recovery, while the biggest drawback that seems to be having the upper hand remains uncertainties surrounding the political environment ahead of the 2019 general elections which would not just go away.

As if this was not enough, the rising debt level in the continent as noted recently by the International Monetary Fund (IMF) may just be a factor that is investors, most of whom are foreign, are keeping it in view (READ FURTHER). As if to assuage such fears however, Nigeria’s Finance Minister, Mrs. Kemi Adeosun, on Monday assured that the decision by the Muhammadu Buhari administration to reduce the nation’s cost of servicing international borrowings is yielding fruits, with its debt servicing cost dropping to 13% from 18% (READ FURTHER). Recall that the administration, last year issued $2.5bn Eurobond to pay off maturing domestic bonds, as part of reducing the huge cost of debt servicing.
Mrs. Adeosun had also noted on her personal twitter handle that the administration spent a significant N1.5tr on capital projects. Investdata agrees with those who argue that the impact of such spending is yet to reflect on the economy with road and power infrastructure, which have direct bearing on the economy still a far cry.

We note that the monetary policy induced stimulus of the Central Bank of Nigeria (CBN) that has kept the economy running is in dire need of fiscal stimulus to quicken and sustain this recovery, while ushering real and stable growth/development.
Monday’s market technicals were negative, as sell offs continued among highly capitalized equities, in the midst of low volume high selling pressure and negative market breadth. Selling volume stood at 97% and buying pressure, 3% on a volume index of 0.57 of the day’s total transactions. This evidenced profit taking by smart money as reflected in the money flow index that is turning at 61.77 points from previous day’s 60.55 points, an indication that funds in the market are weakening.

Index and Market Cap

The composite All-Share Index (ASI) shed 344.70bps to settle at 40,677.91bps, after opening at 41,022.31bps, representing a 0.84% decline on a low volume that was marginally higher than previous day’s. Similarly, market capitalisation lost N124.87bn to close at N14.73tr from an opening value of N14.86tr, also representing 0.84% value loss that further deepened investors reddish portfolio.
The day’s downturn followed sell-offs in high cap stocks like Dangote Cement, Nestle, NB, Oando, ETI, FBNH, Zenith Bank, Access Bank and Flour Mills, which impacted negatively on the NSE’s Year-to-Date returns. It contracted to 6.32%; while market capitalisation gains for the period fell to N1.08tr, representing 8.06% above the year’s opening value.

Bearish Sector Performance

Sectorial performance for the day were bearish to close red, except for the NSE Oil/Gas that managed to close green limping 0.01% as a result of marginal gain recorded by Eterna.
Market breadth remained negative as decliners outnumbered advancers in the ratio of 32:11 to halt Friday’s up market.
Market activities were mixed with volume traded up by 2.0% to 218.76m shares, as against previous day’s 214.58m, while transaction value fell by 47.3% to N2.29bn compared to Friday’s N4.23bn.
Transaction volume was boosted by financial services stocks like UBA, FCMB, Sovereign Trust Insurance, FBNH and Fidelity Bank which witnessed increased trading to top the activity chart.

The best performing stocks were Caverton and Sterling Bank, which topped the advancers’ table, gaining 5% and 3.8% respectively to close at N2.74 and N1.63 each. This was due to market sentiments and forces
On the flip side, C&I Leasing and First Aluminum were the worst performing, after shedding 9.4% and 8.9% respectively to close at N1.55 and N0.41 each on profit taking and market forces

Market Outlook
We expect mixed market as bargain hunters take advantage of low prices in the midst of volatility as investors reposition their portfolios, on the strength of stronger numbers with which most companies began the 2018 financial year. Added to this is the economic fundamentals that are daily becoming more robust, which the expected Q1 GDP and April inflation data would likely confirm as part of the positive impact of monetary stimulus, among other extraneous factors. The National Bureau of Statistics (NBS) is expected to publish the April Consumer Price Index before Tuesday’s market open, amidst hope that such expected improvement in inflation as in the past would have any meaningful impact on the NSE’s indicators.

However, we would like to reiterate that investors should not panic but go for equities with intrinsic value, especially during this season when dividend payment is ongoing and Q1 results are expected in the market arena.
We advise investors to allow numbers guide their decisions while repositioning in any stock, especially now that stock prices remain volatile amidst improving company, economic and market fundamentals.

It is time to combine fundamentals and technical tools to take decision by knowing the support and resistant level to reposition or exit any position. A stock market is in cycles. You must know the cycle it, or particular stocks therein are to successfully manage your trading and investment risk. For stocks that should be on your shopping list to buy in these seasonal changes as the year unfolds, sign up to INVESTDATA BUY AND SELL signal setup by calling 08032055467.

Get your home study pack of the INVEST 2018 Traders & Investors Summit and ride with the current recovery on Nigeria’s stock market and economy, thereby ensuring that you invest and trade with knowledge. You can also access stocks analysed in the home study pack of the Chart Summit held on February 24, 2018, including the 15 stock-picks for 2018 are available now to guide your positioning as trading for the year.
Comprehensive training materials on stock Trading and Investing for Financial Independence series are Available, you can play and watch on your mobile phone, laptop, desktop and TV set. Kindly call or send yes to 08032055467, 08028164086 or 08111811223.

Ambrose Omordion
CRO| Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambrose.o@investdata.com.ng
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467
https://investdata.com.ng/2018/05/investors-await-impact-positive-economic-indicators-nigerian-bourse/#more

Mixed Reactions At Bond As Investors Await Release of April Inflation Data


Bond market
The market resumed this week on a quiet note, few sales were witnessed on long dated maturities especially the 2021 and 2034 FGN bond maturities.
Players anticipate a decline in inflation figure to be released this week hence, we expect to see a mixed market. Average yields closed at 13% levels.

Treasury bills.
It recorded a mixed market with sales on medium and long maturities. Some local and offshore investors purchased bills with high yield to make positive spread in the coming days. However, yields are expected to dip in the secondary market following OMO maturities on Thursday.

Interbank
The OBB and Overnight rates recorded a significant increase of 150% and 164.17% as banks were scouting for liquidity to fund their respective Portfolios. The Interbank rate remained stable at its previous rate of N305.80/$, even as the CBN intervened in the market with a total Sale of $210m.

https://investdata.com.ng/2018/05/mixed-reactions-bond-investors-await-release-april-inflation-data/#more

Do You Know The Best Time for Reinvesting?

When a stock you own pays dividends, you have two options: pocket the cash and use it as you would any other income, or reinvest it by purchasing additional shares of stock. Though having a little extra cash on hand may be appealing, reinvesting your dividends can really pay off in the long run especially when the market is down.

So back to the Basics, Companies pay dividends to their shareholders to reward them for their investments and continued support. Dividends are taken from a company's retained earnings, which is the amount of cumulative profits that remains after accounting for all expenses and any reinvestment in the company's expansion. Though dividends can be issued in shares of stock, they are commonly issued as a cash payment.

However, reinvesting your dividends simply means purchasing additional shares of stock with the money you receive. On most trading platforms, you can choose to have this done automatically on your behalf. Proponents of this tactic highlight the fact that, by purchasing new shares of a stock that you know pays dividends, you can grow your investment at a much quicker rate than if you pocket your dividends and rely solely on capital gains to generate wealth.

But it is strictly for those who want to do long-term investments which is still okay. However, if you are thinking of a short-term or immediate return on investment, then it is recommended that you get

1. Go for a consistent Stock Market training.
2. Carry out an intensive Research
3. Register for membership where stockbrokers share stocks to buy and stocks to sell decisions

However, the (1) and (2) consumes a lot of time, money and unnecessary resources which is not redeemable. The (3) does not because I have has done everything for you which is what my Buying and Selling Signal Premium Membership stands for. Register NOW. The price will soon go up. Call 08028164085,08032055467 or send an email to ambroseconsultants@yahoo.com Now to Get Started

Happy Trading,
Ambrose Omordion
https://investdataltd..com.ng/2018/05/do-you-know-best-time-for-reinvesting.html

DEMATERIALISATION OF SHARES

Dematerialisation is the conversion of share certificates(physical paper form) to an electronic form which domiciled directly with the central securities clearing system (CSCS).

A shareholder can dematerialise their shares by opening an account with CSCS through a stockbroker. Then, the shareholder can submit their share certificates to the stockbroker for dematerialisation; thereafter a verification form will be filled and forwarded with the certificate to the Registrar for verification.
The share certificate verified by the Registrar are then sent to CSCS, CSCS will then update the shareholder’s account with the corresponding securities and units. Finally, shareholder can request for a CSCS statement of account detailing the shareholding position and the corresponding units from the stockbroker.

Investdata Academy
http://investdataltd..com/2018/05/dematerialisation-of-shares.html

Investdata Daily Sentiment Reports

NSEASI buy 40% sell 60% MFI 56.80
Aiico buy 50% sell 50% volume index 2.32 MFI 55.98
Caverton buy 0% volume index 1.02 MFI 70.58
Dangote sugar buy � MFI 31.59
Fbnh buy 10% sell 90% MFI 48.49
Fcmb buy 82% sell 18% MFI 17.79
Fidelity buy 14% sell 86% volume index 0.85 MFI 25.85
Fmn buy � volume index 1.49 MFI 60.72
GT buy 0% volume index 1.31 MFI 44.30
Hony flour buy � volume index 0.95 MFI 62.14
Lasaco buy � volume index 0.88 MFI 78.40
Oando buy 0% volume index 1.04 MFI 40.15
Transcorp buy 63% sell 38% MFI 14.77
Uba buy 67% sell 33% volume index 0.81 MFI 70.85
Zenith buy 0% MFI 61.23


Investdata Consulting Ltd
http://investdataltd..com/2018/05/investdata-daily-sentiment-reports_16.html

Equity Analysts Await Market Reactions To Latest Economic Data, News


Market Update for May 15, 2018

The nation’s stock market on Tuesday continued its volatility and downtrend to record another back-to-back negative session as selling pressure was sustained majorly in the banking sector to further drag the market lower after breaking the first strong support level of 40,725.80.
The benchmark Nigerian Stock Exchange (NSE) All-Share Index opened on a slide that was reversed by mid-morning, but pulled back again before midday, as it continued the up and down movement before closing negative after touching intraday highs of 40,723.49 and lows of 40,565.66 on a low traded volume.

Also, on Tuesday there was another positive economic news as the National Bureau of Statistics (NBS) release the Consumer Price Index for the month of April, which came in better than expected, with the headline inflation rate declining further for the 15th consecutive month to 12.49%, from March level of 13.34%. Among others, it confirmed the improving state of the economy, following which analysts are looking to the Central Bank of Nigeria (CBN) at next week’s Monetary Policy Committee (MPC) ease Monetary Policy Rates, arguing that inflation has in two months remain below the 14% Monetary Policy Rate (MPR), given that in theory, interest rate should not be above inflation.

Investdata believes something should be done but notes the negative effects of spending ahead of and during the approaching 2019 general elections, as well as the late approval of the 2018 budget any moment from now, and the recent move by the government to settle contractor debts and obligations to pensioners of the defunct Nigerian Airways. The payment of contractors will have positive impact on the banks profitability and reduces the NPL that had eaten into the bottom line of the financial institutions (READ). As a sign that we should not begin to rejoice just yet, the National Assembly has reportedly raised the 2018 budget by over N508bn, bringing it to N9.12tn, from the N8.612tn original estimates presented to the law makers on November 7, 2017 by President Muhammadu Buhari.
Market technicals for Tuesday were negative and mixed as sell offs in high cap stocks reduced in the midst of low volume and negative market breadth, just as selling volume stood at 60% and buying pressure, 40% on a volume index of 0.55 of the day’s total transactions. The bearish run has reflected in the money flow index as energy behind the market movement remains weak at 56.80 points from previous day’s 61.77 points. This is an indication that funds are still leaving the market.

Index and Market Cap
Benchmark Index (ASI) for day shed marginal 62.19 bps to close at 40,615.42bps, after opening at 40,677.91bps, representing a 0.15% decline on a low volume that was marginally lower than the previous day’s. Similarly, market capitalisation went down by N22.41bn to close at N14.71tr from an opening value of N14.73tr, also representing 0.15% value loss that further threw investors into red position.
The session’s downturn was as a result of profit booking in low, medium and high cap stocks like GTBank, Zenith Bank, Fidelity Bank, Oando, ETI, FBNH, Diamond Bank, UBA, Cadbury and Flour Mills. This impacted negatively on the NSE’s Year-to-Date returns, which dropped to 6.20%; while market capitalisation gains for the period fell to N1.12 trillion, stand at 8.10% above the year’s opening value.

Mixed Sector Performance
Sectorial performance for the day were largely bullish, except for NSE Banking that closed in the red, while NSE Oil/Gas was flat and others were in the green to close higher, due to value gain in Nestle, NB, Continental Reinsurance, Wapic and CAP.
Market breadth remained negative as decliners outnumbered advancers in the ratio of 25:12 to continue two days down market.
Market activities were mixed as volume traded contracted by 7.0% to 203.36m shares from previous day 218.76m, while value was up by 98.5% to N4.43bn from the previous day’s N2.29bn.

Transaction volume was boosted by financial services and oil stocks like Guaranty Trust Bank, UBA, Fidelity Bank, Zenith Bank and Oando which witnessed increased trading to top the activity chart.
The best performing stocks were Sovereign Trust Insurance and Continental Reinsurance which topped the advancers’ table gaining 5% and 4.23% respectively to close at N0.21 and N1.48 each. This was due to market sentiments and forces
On the flip side, Vertas Kapital and Diamond Bank were the worst performing, losing 9.52% and 9.39% respectively to close at N0.38 and N1.64 each purely on profit taking and reactions to unimpressive earnings report.

Market Outlook
We expect a marginal rebound on bargain hunters take advantage of low prices in the midst of volatility as investors reposition their portfolios, on the strength of company’s stronger numbers to start the financial year, as economic fundamentals become more robust as reflected in the April consumer price index. The market is expected to also price the news of plans by the fiscal authorities seek National Assembly approval to settle contractors’ debt which will boost economic activities. We expect Q1 GDP and outcome of MPC meeting next week to give direction. Investors should not panic out of their position but watch events as it unfolds

However, we would like to reiterate that investors should not panic but go for equities with intrinsic value, especially during this season when dividend payment is ongoing and Q1 results are expected in the market arena.
We advise investors to allow numbers guide their decisions while repositioning in any stock, especially now that stock prices remain volatile amidst improving company, economic and market fundamentals.

It is time to combine fundamentals and technical tools to take decision by knowing the support and resistant level to reposition or exit any position. A stock market is in cycles. You must know the cycle it, or particular stocks therein are to successfully manage your trading and investment risk. For stocks that should be on your shopping list to buy in these seasonal changes as the year unfolds, sign up to INVESTDATA BUY AND SELL signal setup by calling 08032055467.

Get your home study pack of the INVEST 2018 Traders & Investors Summit and ride with the current recovery on Nigeria’s stock market and economy, thereby ensuring that you invest and trade with knowledge. You can also access stocks analysed in the home study pack of the Chart Summit held on February 24, 2018, including the 15 stock-picks for 2018 are available now to guide your positioning as trading for the year.
Comprehensive training materials on stock Trading and Investing for Financial Independence series are Available, you can play and watch on your mobile phone, laptop, desktop and TV set. Kindly call or send yes to 08032055467, 08028164086 or 08111811223.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambrose.o@investdata.com.ng
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467
https://investdata.com.ng/2018/05/equity-analysts-await-market-reactions-latest-economic-data-news/#more

FBNQuest Projects 11.3% Inflation In May, Expects Rates Retention At MPC


Analysts at FBNQuest, the merchant banking and asset management arm of FBN Holdings Plc, on Wednesday welcomed the continued decline in Nigeria’s inflation rate for the 15th consecutive month as published by the National Bureau of Statistics (NBS).
The deceleration, which it said was in line with expectation shared with wire services was driven principally by the decline in food price inflation from 16.1% to 14.8% YoY and Core inflation from 11.2% to 10.9% YoY. Following from this and based on the realities on the ground, the analysts expect a further decline in headline inflation to 11.3% Year-on-Year at the end of current month.
Also, FBNQuest in its Nigeria/Daily Morning Note of May 16, 2018, titled “a further steep decline in inflation,” expects “the positive base effects are set to run through to June/July.”

Despite the sustained drop in inflation, the researchers do not see any immediate rate cut by the Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC) when it meets next week.
“Signals from members’ latest personal statements suggest that the committee will not rush to adopt an easing stance,” FBNQuest stressed.
Those who do not support a rate cut immediately, including members of the MPC in their personal notes at the April meeting, draw attention to factors such as the anticipated spending for the 2019 general elections, beginning with the July governorship poll in Ekiti, followed by that of Osun. There is also as the 2018 budget was only concluded by the National Assembly on Tuesday, which is coming with over N508bn that would shoot the figure to N9.12tn, from the N8.612tr original estimates presented to the legislature on November 7, 2017 by President Muhammadu Buhari.
In a tweet on Wednesday, Senator Shehu Sani, Kaduna State, explained that the decision to jerk up the budget “happened in close consultations and agreement between the National Assembly led by the Appropriation committee and the Executive. The committee confirmed this.”

https://investdata.com.ng/2018/05/fbnquest-projects-11-3-inflation-may-expects-rates-retention-mpc/#more

IOSCO To Focus On Challenges Of Securities Market Regulation Worldwide


Members of the International Organization of Securities Commissions (IOSCO) rose from its 43rd Annual Conference in Budapest, Hungary, with a resolve to focus on, and proffer solutions to key issues confronting securities market regulation across the globe.
A statement by Efe Ebelo, acting head, Corporate Communications at Nigeria’s Securities & Exchange Commission (SEC), on Tuesday said the public sessions of the conference deliberated on key issues such as the sale of unsuitable products to retail investors; and the challenges of Fintech and digitalization.

The conference also discussed the shift from active to passively managed collective investment schemes, as well as how Small and Medium-scale Enterprises (SMEs) can access the capital market for the much-needed funding.
Speaking at the conference, Ashley Alder, Chair of the IOSCO Board, said members took important steps during the event to advance “priority work in focused areas such as market resilience, financial technologies, and information sharing among securities market regulators, while addressing the biggest risks to investor protection, market integrity and financial stability.”

The board also discussed how best to approach the continuing growth of Initial Coin Offerings (ICOs) and agreed on the need to develop a Support Framework that would assist members as they consider how to address domestic and cross-border issues stemming from coin offerings that could impact investor or consumer protection.
On her part, Acting Director-General of SEC Nigeria, Ms. Mary Uduk assured of the determination of management in advancing the initiatives which she said are aimed at protecting investors, while ensuring fair, efficient and transparent markets, and mitigating systemic risk.

https://investdata.com.ng/2018/05/iosco-focus-challenges-securities-market-regulation-worldwide/#more

IMF Task Nigeria, Others On Tax Revenue, Public Spending, Jobs, As China Shoots Global Debts To $164tr


A new report Global Debt Database, by the International Monetary Fund (IMF) wants nations across the globe to put in place automatic stabilizers like tax and spending that move in sync with output and employment to operate fully.
These, it said, should be complimented with driving down deficits and debts towards medium-term targets, lamenting the rising global public and private sector debt conundrum.

The report titled: IMF Fiscal Monitor: Capitalizing on Good Times, drew attention to global debts now at a historic $164tr in 2016, representing 225% of world GDP and representing 12% more than the previous 2009 peak. Global debt, unlike in 2009, the IMF noted, is driven this time by China, which accounted for 43% of the increase.
While global debt level stood at $116tr 2007, China’s debt level soared from just $5tr at the time to $26tr in 2016, representing a 420% leap over the period.

According to the IMF, “public debt plays an important role in the surge in global debt, reflecting the economic collapse during the global financial crisis and the policy response, as well as the effects of the 2014 fall in commodity prices and rapid spending growth in the case of emerging markets and low-income developing countries.”
Debt in advanced economies, the report added, is at 105% of GDP on average, levels not seen since World War II, while that of emerging market and middle-income economies, is close to 50% of GDP, levels last seen during the 1980s debt crisis.
For low-income developing countries, average debt-to-GDP ratios have been climbing at a rapid pace and exceed 40% as of 2017, nearly half of which is on non-concessional terms. This has expectedly resulted in a doubling of the interest burden as a share of tax revenues in the past 10 years.

“Underpinning debt dynamics for all countries are large primary deficits, which reached
record levels in the case of emerging market and developing economies,” expressing concern over the high government debt and deficits.
“Countries with elevated government debt are vulnerable to a sudden tightening of global financing conditions, which could disrupt market access and put economic activity in jeopardy.
“Moreover, experience shows that countries can be subject to large, unexpected shocks to public debt-to-GDP ratios, which would exacerbate rollover risks. It is important to note that large debt and deficits hinder governments’ ability to implement a strong fiscal policy response to support the economy in the event of a downturn.

“Historical experience shows that a weak fiscal position increases the depth and duration of recession—such as in the aftermath of a financial crisis—because governments are unable to deploy sufficient fiscal policy to support growth.”
Building fiscal room to manoeuver, the IMF stressed, is especially relevant now that private sector debt is at record highs and rising, drawing attention to excessive private debt in some countries that puts them at risk of an abrupt and costly deleveraging process.
The report called for decisive action “to strengthen fiscal buffers, taking full advantage of the cyclical upswing in economic activity,” helping to protect the economy, both by creating room for fiscal policy to step in to support economic activity during a downturn and by reducing the risk of financing difficulties if global financial conditions tighten
suddenly.
According to the executive summary of the report, the IMF urged all countries “to keep their sights on policies to lift their medium-term growth outlook.

“Indeed, recent fiscal adjustment in some countries has not necessarily prioritized growth-friendly measures, as illustrated by the decline in public investment spending as a share of GDP among advanced economies and commodity exporters.
“Advanced economies should focus on seeking efficiency gains in spending and rationalizing entitlements to make room for more public investment, incentives for labor market participation, and improvements in the quality of education and health services. Some advanced economies would also benefit from broadening tax bases and upgrading the design of their tax systems.”
It urged emerging market and developing economies, to prioritize raising revenue for financing “critical spending on physical and human capital and social spending. All countries should promote inclusive growth to avoid excessive inequality that can impede social mobility, erode social cohesion, and ultimately hurt growth.”

https://investdata.com.ng/2018/05/imf-task-nigeria-others-tax-revenue-public-spending-jobs-china-shoots-global-debts-164tr/#more

Union Bank Of Nigeria: Mixed Financials, Good For Long Term Positioning


Company: Union Bank of Nigeria Plc
Rating: Long Term Buy
Current Market Price: N6.75
Intrinsic Value: N13.32
Latest Cash Div: NIL
By: Jeariogbe Tunde Segun (Equity Analyst)

Key Financial Tickers
• This report takes into consideration both the full year financial performance indices of UBN ended December 31, 2017 and the first quarter ended March 31, 2018 statistics.
• Leading from the last oversubscribed right issue of UBN the new shares outstanding used in our analysis is 29.120 billion units.
• Between the December 2016 and 2017 financial year, the Non-performing loan (NPL) ratio soared from 6.9% to 19.8%, while the ratio moderated within the first three months of 2018 to 14.9%.
• In its full year statistics, the Retained Deficit dropped outstandingly from N244.183 billion to N14.384 billion. Surprisingly, it increased to N16.710 billion in its 2018 first quarter result. We are of the opinion that the management should pay keen attention to this figure to encourage investors, especially those who faithfully participated in its last capital raising exercise through the right issue.
• Due to the deficit state of the financial institution reserve, it has not been able to reward investors in a long while. We are of the opinion that if the management maintains cautious models through the current financial year, investors’ hope of being rewarded will increase.


Corporate Figures
• Gross Earnings for the 2017 full-year grew by 26.42% over the comparable period of last year, moving from the N129.60 billion of 2016 to the current N163.84 billion
• Similarly, Interest Income estimated at N124.54 billion from the N99.72 billion reported in 2016 financial.
• Net Impairment Charge was N25.609 billion, as against the N17.879 billion in the comparable period.
• Thus, both Profit before and after Tax stood below 2016’ by 1.39% and 5.09% respectively.
• As noted above, there was a retained Deficit of N14.384 billion, as against the N244.183 billion in 2016
• Enhanced by the just concluded right issue, Net Assets value improved by 27.27% to N345.741 billion, compared to the previous N271.670 billion.


Liquidity/Risk Ratios
• The share price of Union Bank is theoretically less volatile than the market. In our opinion, this could be linked to the no dividend status of the bank, traders are likely playing equities with stronger probability of paying dividend.
• Although a financial institution, it currently runs a fair Debt to Equity ratio of 28.69%, slightly above the industry average of 27.17%.


Profitability Ratios
• The amount reported as Interest Expense is same as 35.33% of the Gross Earnings figure, this is 32.01% over the 26.76% estimated in similar period of 2016.
• Profit before Tax (PBT) Margin decreased by 22.00% from similar period of 2016. As can be seen from the table below, PBT is 9.47% of the Gross Earnings as against the 12.14% margin in 2016
• Similarly, Profit after Tax stood below 2016’s by 24.92% as the margin between the profit for the year and the Gross Earnings is currently estimated at 8.92% as against the previous 11.88%
• In other words, 91.08% of the Gross Earnings were used to take care of various expenses through the year. In our opinion, this is evidently on the high side.


Efficiency Ratios
• Gross Earnings to Total Assets ratio was fairly stable through the years under comparison in this report. The Gross Earnings is currently estimated to be 11.26% of the Total Assets, as against the 10.35% estimated last year
• Gross Earnings to Equity was also fairly stable having reduced marginally to 47.39% from the 47.71% estimated in 2016 figures.
• Going by the Financial Leverage of 4.21x, it can be safely concluded that the financial institution has used more debt (as against the equity) to acquire additional assets. Please note that the index only dropped by 8.70% below the estimates in 2016
• Considering the inherent risk in the operating environment, the bank seems to have adopted a cautious approach towards creation of risk assets as the Loan to Deposit dropped by 15.42% from 67.74% to 57.30%


Investment Ratios
• The amount earned per share of Union Bank is currently estimated at N0.50 based on the current 29.120 billion units. The said earning is 44.80% below the N0.90 estimated in 2016 when the outstanding shares were 16.935 billion
• Similarly, Total Comprehensive Income for the period stood below 2016 income by 43.60%
• Since the difference in EPS was far higher than changes observed in the market price of UBN shares, the current earnings only yielded 7.43% of the current market price, this is lower than the 18.18% yield achieved in 2016
• Nevertheless, reasonable investor confidence was achieved within the period, based on the improvement in the PE/Ratio from 5.50x to 13.46x
• Going by the estimated 0.57x Price to Book Value, one could safely conclude that the shares of Union Bank are underpriced, a fact that is further established by the estimated N11.87 Book Value, as against the N6.75 market price as at released of this result.


First Quarter 2018 Financial Indices
• Outstandingly, all income statement improved over corresponding quarter of 2016
 Gross earnings: Up 15% to N39.5bn from the ₦34.3bn posted in Q1 2017,
 Profit before Tax improved over 2016 by 16.01% from N4.661 billion to N5.407 billion
 Profit after Tax equally appreciated over 2016 by 17.02%. Currently standing at N5.288 billion, compare to N4.519 billion last year
• Total Assets dropped by 5.11% from N1.455 trillion to N1.381 billion.
• In the same trend, Total Liability shifted down marginally by 1.28% to N1.095 trillion from N1.109 trillion.
• Net Assets posted for the period is now N285.652 billion, which is 17.38% below the previous N285.652 billion, despite the capital recently raised through the right issue.
• On the strength of the above mentioned
 Profit per share for the reported three months is 18k compared to the 27k earned in Q1-2017
 The said earnings is a marginal yield of 2.69% over the current market price as at the released of the financials
 Book Value dropped to N9.81 below the N20.41 achieved at the end of Q1-2017

Valuation
• Our valuation method considered the zero incentive status of Union Bank over the years
• Thus, we adopted the residual income valuation model with the assumption that the next full year earnings will drop and then remain stable (three-year income considered)
• We arrived at N13.32 per share intrinsic value for each unit of Union Bank.
• On the strength of this we recommend a very long term position in the share price of Union Bank Plc.

https://investdata.com.ng/2018/05/union-bank-nigeria-mixed-financials-good-long-term-positioning/#more

DEBT RATIO

The debt ratio is a financial ratio that measures the extent of a company’s leverage. It is defined as the ratio of total debt to total assets, represented as a decimal or percentage. It could also be referred to as the debt-to-assets ratio.
Debt Ratio = Total Debt/Total Assets

The higher the debt ratio, the more leveraged a company is, implying greater financial risk. A debt ratio greater than 100% tells you that a company has more debt than assets. Meanwhile, a debt ratio less than 100% indicates that a company has more assets than debt. Debt ratio used in conjunction with other measures of financial health, can help investors determine a company’s risk level.

Investdata Academy
http://investdataltd..com/2018/05/debt-ratio.html

Investdata Daily Sentiment Reports

NSEASI buy 93% sell 7% volume index 0.71 MFI 64.00
Aiico buy volume index 1.44 MFI 48.85
CIleasing buy 50% sell 50% MFI 88.64
Dangote flour buy volume index 0.71 MFI 22.32
Dangote sugar buy MFI 31.13
Fbnh buy 63% sell 37% MFI 63.29
Fcmb buy MFI 16.44
Fidelity buy MFI 30.20
GT buy 89% sell 11% volume index 1.08 MFI 40.03
Oando buy 20% sell 80% MFI 42.23
Uba buy 0% MFI 64.80
Ubn buy MFI 86.58
Wapco buy volume index 1.15 MFI 33.36
Wema buy 67% sell 33% volume index 1.98 MFI 21.12
Zenith buy 43% sell 57% volume index 1.06 MFI 56.44

http://investdataltd..com/2018/05/investdata-daily-sentiment-reports_17.html

Finally, NSE Indicators Close Positive On Flurry Of Positive Economic News, Data


Market Update for May 16, 2018

After two days in the red, Nigeria’s stock market had green, even if very volatile session on Wednesday on a low traded volume with improved buying pressure. Traders took advantage of low valuations in the midst of impressive economic data as the fiscal authority seems to be waking up to complement the monetary policy stimulus that had supported the economy so far. It is may be too early to link the positive close to Wednesday passage of the 2018 Appropriation Bill, six months after it was sent to the National Assembly, preparatory to been transmitted to President Muhammadu Buhari for assent. The budget passed by both legislative arms is coming with an additional N508bn spending capacity at N9.1tr, just as the crude oil benchmark was raised to $50.5 per barrel, up from $45 originally set.
The Nigerian Stock Exchange’s All-Share Index opened lower early and then rallied back at the mid-morning to usher in five waves which touched intraday highs of 41,027.28 that was the resistance for the day from the low of 40,531.90.
There was also an obvious market reaction to positive economic news likely the continued decline in inflation rate as April report revealed, just as the Federal Government made known its plans to settle debt owed to contractors. There is also the expected release of Nigeria’s Q1 GDP report by the National Bureau of Statistics (NBS), which many macro-economic indices show may come better than previously anticipated compared to the previous quarter.

The renewed interest of foreign participants in the market as revealed by transactions in Nestle, Guaranty Trust Bank, UBA and Nigerian Breweries cannot be over-emphasised. For example, 600,000 units of Nestle was traded at N1,600 per share, while Guaranty Trust Bank’s 20m shares changed hands at N44 each. UBA’s 25m units were crossed at N11.60 and NB, 4.2m shares at N124 per unit.
We have said repeatedly that it is the interpretation foreign investors give to the coming 2019 general elections that will determine the next phase of the market after it had corrected for almost five months in the midst of stronger corporate earnings and improving economic recovery.
Also, the fear of higher yield in the international market is a threat to global market stability. The risk now seems to be bubble in emerging market currencies due to divergence in global monetary policies arising from the widening gap in rates which will create capital flight out of low rate environments into the US where yield, the US$ and oil price are looking up.

Midweek’s market technicals were positive and weak as volume traded were low in the midst of negative market breadth and buying pressure of 93% while selling volume stood at 7% on a volume index of 0.71 of the day’s total transactions. The resurgence of the bull reflected in the money flow index at 63.99 points from previous day’s 56.80 points. This is an indication that funds are entering the market again but we have to watch to see if it can be sustained.

Index and Market Cap
The composite NSEASI gained a strong 377.55 basis points, closing at 40,992.97bps, after opening at 40,615.42 bps, representing a 0.93% growth on a low volume that was higher than the previous day’s. Similarly, market capitalisation was up by N136.76bn to close at N14.9tr from an opening value of N14.71tr, also representing 0.93% value gained to reduce the losing position of investors.
The rebound as mentioned in our earlier was driven by bargain hunter taking position in medium and high cap stocks like Dangote Cement, NB, Nestle, Zenith Bank, Fidelity Bank, ETI, Dangote Sugar, Unilever and AXA Mansard Insurance. This impacted positively on the NSE’s Year-to-Date returns, which rose to 7.19%; while market capitalisation gains for the period stands at N1.21 trillion, stand at 9.04% above the year’s opening value.

Mixed Sector Performance
Sectorial performance for the midweek’s session were largely bullish, except for the NSE Banking and Oil/Gas that were lower as a result of sell pressures in Access Bank, UBN and Forte Oil that pulled down the two indices. NSE Consumer, Insurance and Industrial indexes were higher due to price appreciation in Nestle, NB, Dangote Cement and AXA Mansard.
Market breadth remained negative as decliners outweighed advancers in the ratio of 30:15 to reverse two days down sessions.
Market activities were mixed as volume traded rose by 27.6% to 259.49m shares from previous day’s 203.36m units, while value was marginally down by 1.5% to N4.36bn from the previous day’s N4.43bn.

Transaction volume was boosted by banking and services providers stocks like Diamond Bank, Zenith Bank, Guaranty Trust Bank, FCMB and Tran nation-wide express which witnessed increased trading to top the activity chart.
Cutix and Unilever were the best performing stocks as they topped the advancers’ table, gaining 5% and 4.9% respectively to close at N3.15 and N52.35 each. This was due to expectation Q4 earnings and market sentiments.
On the flip side, Skye Bank and Diamond Bank were the worst performing, losing 9.4% and 9.1% respectively to close at N0.77 and N1.49 each purely on profit taking, non-release of three years financials by Skye, as well as reactions to unimpressive 2017 full year and 2018Q1 earnings reports by Diamond.

Market Outlook
We expect sustain trend as bargain hunters take advantage of low prices in the midst of volatility as investors reposition their portfolios, on the strength of company’s stronger numbers to start the financial year, as economic fundamentals become more robust as reflected in the April consumer price index. The market is expected to also price the news of plans by the fiscal authorities seek National Assembly approval to settle contractors’ debt which will boost economic activities. We expect Q1 GDP and outcome of MPC meeting next week to give direction.
Investors should not panic out of their position but watch events as it unfolds

However, we would like to reiterate that investors should not panic but go for equities with intrinsic value, especially during this season when dividend payment is ongoing and Q1 results are expected in the market arena.
We advise investors to allow numbers guide their decisions while repositioning in any stock, especially now that stock prices remain volatile amidst improving company, economic and market fundamentals.
It is time to combine fundamentals and technical tools to take decision by knowing the support and resistant level to reposition or exit any position. A stock market is in cycles. You must know the cycle it, or particular stocks therein are to successfully manage your trading and investment risk. For stocks that should be on your shopping list to buy in these seasonal changes as the year unfolds, sign up to INVESTDATA BUY AND SELL signal setup by calling 08032055467.

Get your home study pack of the INVEST 2018 Traders & Investors Summit and ride with the current recovery on Nigeria’s stock market and economy, thereby ensuring that you invest and trade with knowledge. You can also access stocks analysed in the home study pack of the Chart Summit held on February 24, 2018, including the 15 stock-picks for 2018 are available now to guide your positioning as trading for the year.
Comprehensive training materials on stock Trading and Investing for Financial Independence series are Available, you can play and watch on your mobile phone, laptop, desktop and TV set. Kindly call or send yes to 08032055467, 08028164086 or 08111811223.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambrose.o@investdata.com.ng
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Tel: 08028164085, 08032055467
https://investdata.com.ng/2018/05/finally-nse-indicators-close-positive-flurry-positive-economic-news-data/#more