UBN Plc witnesses renewed bargain sentiments as speculative trading dominates market

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UBN Plc witnesses renewed bargain sentiments as speculative trading dominates market

Wednesday, 27 June 2012 /Proshare Research

The market price volatility continued to gain tempo as mid week market analysis suggests while market seesawed, recording two days negative postures before patronage towards heavy counters in Consumer Goods sector salvaged the downtrend.

Also, the sustained weak market breadth revealed the weak bargain posture while end of the quarter pressure appeared dictating the pace as we have envisaged in our recent sentiments analysis.

At the end of the today’s session, technical analysis revealed weak positive sentiments as market witnessed increased moderate sell activities across the board while market turnover significantly closed positive with increased in Naira votes- indication of increased sell propensity.

More so, continued moderate bargain was observed towards active and liquid penny stocks, mainly in medium capitalisation category while market closed with WTD performance of 0.84% gain- weak market optimism was observed when compared with previous mid-week performance of 1.54% gain while YTD performance stands at 4.07% as against 3.67% recorded in the previous week.

The improved patronage witnessed towards blue chip stocks in Consumer Goods sector and Industrial Goods contributed to the market outlook so far. The increased accumulation tendency witnessed in Financial Service sector, particularly towards Union Bank Plc contributed to the improved market turnover significantly as noted above while a renewed bargain tendency was observed towards the stock.

The Stocks on the Hunters’ Radar

Investors’ Trading pattern and psychology:

The trading pattern suggests increased speculative tendency while the profile of top 10 stocks on the investors’ radar suggests sustained and improved risk appetite as all the stocks are penny stocks while NESTLE, ETI AND UNILEVER are the only medium and high priced stocks that made top ten stocks on the investors’ radar.

Notwithstanding, the patronage towards penny stocks remained resilient as investors maintained bargain posture towards these stocks.

We however remain concerned with regards to the driver(s) of these top penny stocks that dominated investors’ radar so far in the week. Further analysis into their last financials revealed mixed outlook and subsequent outlines may will shed more lights.

Snapshot comment on their recent results.

PORTPAINT sustained impressive posture with its latest financials. The PAT posture remained positive and impressive in the face of improved financial status as suggests by its working capital postures and bank balances.
JAPUAL positive profit trend was observed while the growth in short term borrowings appeared significant amid huge decline in cash and bank balance- this indicates poor financial status.
RTBRISCOE recorded weak PAT growth of 9.67% with moderate financial status. Though, the significant plunge of -487.09% in working capital of the company remained a big concern to us.
WAPIC recorded significant plunge in the PAT growth with weak gross premium growth- an unimpressive posture as the latest results suggests.
LIVESTOCK recorded impressive posture with improved turnover and PAT posture while the posture of the working capital of the company appeared promising. Also, the slight decline in bank balance and increased in short term borrowings does not suggest anything depressing.

Analysis of investors’ radar (gainers’ list) revealed dominance of the penny stocks, which futher buttressed the above position.

The Bleeding Stocks

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