Wyoming Capital and Partners has projected a positive outlook for the Nigerian stock market in the coming weeks, with banking stocks expected to drive a fresh market rally.
The Chief Executive Officer of the firm, Mr Tajudeen Olayinka, said this in an interview with the News Agency of Nigeria (NAN) on Saturday in Lagos.
Olayinka attributed the expected rally to investors positioning ahead of the release of half-year corporate earnings and interim dividend announcements by listed companies.
“We are expecting half-year results from some listed companies, especially those that traditionally declare interim dividends.
“That is likely to support positive market performance in the coming weeks,” he said.
According to him, investor sentiment will be largely influenced by companies with a track record of rewarding shareholders through interim dividends.
He noted that while First HoldCo had recorded significant price appreciation, several fundamentally strong banking stocks remained undervalued and could attract increased investor interest.
“First HoldCo has moved significantly, and one begins to wonder whether the current price reflects reality or if it is only a temporary push.
“However, other banking stocks are still relatively underpriced. We expect stocks such as Zenith Bank, GTCO, UBA and Access Holdings to witness appreciable price movements as investors position ahead of their results,” he said.
Olayinka added that renewed momentum in banking stocks could lift the broader market, even if other sectors recorded only modest gains.
“If one banking stock begins to move, other sectors are likely to follow.
“We expect to see a rally, though it may not be overly aggressive across the market.
“The banking sector is likely to lead the advance, particularly those stocks that have lagged in spite of their strong fundamentals,” he said.
NAN reports that investors gained N2.532 trillion in market value during the just-concluded trading week, while a total of 4.433 billion shares were traded on the Nigerian Exchange Ltd.(NAN)(www.nannews.ng)