NSE All-Share Index Weekly Digest and Trade Ideas for 30/11/2020

The NSE All-Share Index and Market Capitalization appreciated by 2.19% to close the week at 34,885.51 and N18.228 trillion respectively.

Twenty-seven (27) equities appreciated in price during the week, higher than twenty-one (21) equities in the previous week. Forty-three (43) equities depreciated in price, lower than fifty-five (55) equities in the previous week, while ninety-one (91) equities remained unchanged,
higher than eighty-five (85) recorded in the previous week.

Analysis and Trend Forecast.

In line with my expectation (see last week digest), the market corrected at the beginning of the week but found support at the 33,418 basis point (the minor key level mentioned last week) after bargain hunters stepped in to take advantage of lower-priced equities.

This is actually a confirmation that the bull is in charge right now.

Ordinarily, such breaking news as the GDP contractions in a bear market is enough to take the index lower than the minor support.

With the NSE All-Share Index bouncing off the 23.6% Fibonacci level ( 34, 418 basis point), I think the market is on track to its 1-year high of 35,814 basis which may act as a resistance next week.

While the overall outlook is still bullish as more funds are expected in the coming months, I’d advise you wait for a breakout above the key resistance level highlighted on the chart before buying more stocks.

If the index clears this year-high, then we may witness another bull run that will take us to the January 2018 high of 40,000 basis point.

Trade Ideas

Amidst the rising inflation figure and another around of Naira devaluation to N390, I will put my searchlight on companies with inelastic products and at the same time generate a sizeable percentage of their revenue from export sales.

I recommended one of these stocks in October – see here – and I think it will benefit more from the current economic trend. Although the stock has reached my target price of N74 (up by 24% from N60.20), extended to N79 before correcting lower, you can still add to your watchlist after a healthy correction.

Which of the stocks are you buying this week? Share your comment and I’d be glad to share my feedback on your picks.

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NSE All-Share Index Weekly Digest and Trade Ideas

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