Stocks Commence Week on Negative Note, Benchmark Index Down 0.91%

August 21, 2017/InvestmentOne Research

Please click to download the Market Report for Monday 21st August 2017

EQUITIES:  

  • The Nigerian equities market closed the first trading session of the week negative following the profit taking in DANGCEM (-465pts). This performance, as well as the markdown on ZENITHBANK (-48pts), and the declines in NESTLE (-23pts) and STANBIC (-22pts) more than outweighed the gains in GUARANTY (+102pts), NB (+57pts) and ETI (+21pts). Consequently, the NSE-ASI ended down -0.91% to 36,584.44pts, representing a market capitalisation of N12.61tr.
  • Due to the profit taking in DANGCEM (-4.17%), the Industrial sector closed down -2.25% while the Oil & Gas sector lost -0.06%. With this said, the Banking (+0.80%) and Consumer Goods (+0.73%) sectors closed in the green.
  • Despite the negative close to the NSE-ASI, market breadth index closed positive (+0.10x) as 27 stocks gained led by FLOURMILL (+8.73%) against VITAFOAM (-5.00%) which topped the 16 stocks that declined.
  • Also, market activity spiked today as investors exchanged 368m units of shares worth N6.27bn, representing a +56% spike in total volume and +30% increase in total value. AIICO (+1.79%) was the most actively traded stock with 113m units of shares traded, although GUARANTY (+3.04%) topped the market in regards to total value with N2.48bn worth of shares exchanged.
  • While the market closed in the red today, we highlight that this performance was largely driven by the profit taking on DANGCEM. Despite the dividend markdown on ZENITHBANK today, the banking sector closed positive as investor appetite remained strong. With this said, we expect the market to be volatile going forward with the markdown on GUARANTY later this week, while the release of UBA and ACCESS bank’s Q2 2017 results could provide some level of support to the ASI.

CURRENCY:

  • Although the NGN closed relatively flat at N360 against the USD, it lost -0.61% and -0.86% against the GBP and the EUR to N467.15 and N427.67 respectively at the IEFX window.
  • At the parallel market, the local currency closed unchanged at N370 against the USD and N432 against the EUR while it depreciated by -0.42% to N477 against the GBP.
  • Going forward, we expect the local currency to continue to see support from the CBN’s FX intervention sales.

FIXED INCOME:

  • Following the c.N25bn OMO sales by CBN today, the Overnight and Open Buy Back rates increased to 18.58% and 18.00%, from 12.87% and 12.00% respectively. As at time of writing, money market rates were yet to be published.
  • Although N96bn worth of OMO bills will be maturing on Thursday, we expect CBN to maintain its stance on keeping a tab on liquidity levels. As such, we see rates in the money market staying high in the near term.
  • As a result of CBN continued squeeze on system liquidity, activity at the bond market remained muted with yields on the 5yr, 7yr and 10yr benchmark bonds remaining unchanged at 16.38%, 16.39% and 16.53% respectively.
  • Going forward we expect activity levels to be influenced by liquidity levels.

Below are key NSE statistics as at the end of trades:

Current

36,584.44

Mkt Cap (N’tr)

12.61

Previous

36,920.56

Vol. Traded (m)

                                 368

Day Change

-0.91%

Vol. Day Chng.

56%

WTD Return

-0.91%

Val. Traded (N’bn)

                                6.27

MTD Return

2.07%

Val. Day Chng.

30%

YTD Return

36.13%

No. of Deals

0

YTD High

38,198.60

No. of Gainers

27

YTD Low

24,581.99

No. of Losers

16

52wk High

38,198.60

Top Sub Sect. (by Vol.)

BNK (42%)

52wk Low

24,581.99

Top Sub Sect. (by Val.)

BNK (59%)

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