Nigerian Stocks Close Red to Commence New Week

L – R: Shows Mr. Abimbola Ogunbajo, First Vice President, NSE; Alhaji Aliko Dangote,ex-officio, NSE; Oscar Onyema, OON CEO NSE; Mr. Aigboje Aig-Imoukhuede, President, NSE and Mojisola Adeola, Council Secretary, NSE at the Annual General Meeting (AGM) on Monday in Lagos.

September 25, 2017/InvestmentOne Research

Please click to download the Market Report for Monday 25th September 2017

EQUITIES:  

  • Following the declines NB (-69pts), UBA (-28pts) and WAPCO (-22pts), which more than offset the gains in UBN (+7pts), TOTAL (+6pts) and TRANSCORP (+4pts), the equities market ended negative (-0.37%) in a relative quiet trading session (N1.37bn worth of stock traded).
  • With the exception of the Oil & Gas sector (+0.30%), which ended positive, all other major sectors closed in the red. Industrial (-1.13%) was the worst performer while the Consumer Goods (-0.81%) and Banking (-0.48%) sectors declined.
  • Market activity was uninspiring today, as investors exchanged 107m units of shares worth N1.37bn, corresponding to a -44% and -63% decline in total volume and total value respectively, compared to Friday’s session.
  • Although MEYER was the most actively traded stock with c.20m units of shares, NESTLE (-0.41%) topped the value chart with N791m worth of shares exchanged.
  • With this said, market breadth index ended positive (+0.02x) as 19 stocks advanced compared to 17 stocks that declined. FIDSON (+5.00%) was the best performer against JAIZBANK (-4.29%), which led the losers’ chart.
  • While the ASI has traded sideways in the past few weeks, we believe the direction going forward may be influenced by investors positioning ahead of Q3 2017 earnings season. Nonetheless, we are of the view that the recent sell-off represents an entry opportunity in our recommended quality names.

CURRENCY:

  • At the IEFX window, the NGN remained largely unchanged at N360.31 against the USD. However, the local currency depreciated by -2.16% to N484.58 against the GBP and       -1.63% to N426.15 against the EUR.
  • While the NGN remained fairly flat at N366 against the USD, it depreciated by -0.81% to N492 against the GBP and -0.70% to N440 against the EUR at the parallel market.
  • Going forward, we expect the NGN to continue to see support from the CBN’s FX sales on the back of rising oil production and prices.

FIXED INCOME:

  • The Open-Buy-Back and Overnight rates opened the week lower, falling to 26.67% and 29.42%, from 35.00% and 38.00% respectively on Friday. However, we expect CBN’s N55bn OMO auction earlier today to pressure liquidity levels in the near term. As such, we are likely to see upward pressure on money market rates going forward.
  • As at time of writing, today’s NIBOR rates were yet to be published.
  • Activities in the bond market were fairly muted today, which may not be unconnected with the Apex bank’s continued squeeze on system liquidity. Nonetheless, investors were largely bearish, particularly on the 10yr benchmark bond with the yield up +13bps to 16.02%. Yields on the 5yr and 7yr benchmark bonds were fairly unchanged at 15.88% and 16.31% respectively.
  • In the near term, we expect activity levels to be influenced by liquidity levels and foreign investor participation.

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

Current

35,358.73

Mkt Cap (N’tr)

12.19

Previous

35,488.81

 

Vol. Traded (m)

                                 107

Day Change

-0.37%

Vol. Day Chng.

-44%

WTD Return

-0.37%

 

Val. Traded (N’bn)

                                1.37

MTD Return

-0.41%

Val. Day Chng.

-63%

YTD Return

31.57%

 

No. of Deals

3,271

YTD High

38,198.60

No. of Gainers

19

YTD Low

24,581.99

 

No. of Losers

17

52wk High

38,198.60

Top Sub Sect. (by Vol.)

BNK (41%)

52wk Low

24,581.99

Top Sub Sect. (by Val.)

BNK (22%)

opan



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