Daily Market Update for August 4, 2020-Cordros

August 4, 2020/Cordros Report

EQUITIES

The local bourse gained for the third straight session, as the ASI advanced by 0.3% to close at 24,841.94 points. Pertinently, the performance was driven by buying sentiments across NB (+3.2%), SEPLAT (+3.5%) and some Tier 1 bank stocks. Therefore, the Month-to-Date gain increased to 0.6% while Year-to-Date loss moderated to -7.5%.
 
The total trade volume declined by 17.2% to 154.47 million units, valued at NGN1.46 billion and exchanged in 4,222 deals. TRANSCORP was the most traded stock by volume at 13.54 million units while NB was the most traded stock by value at NGN283.82 million.
 
All sector indices, save for the Industrial Goods (-0.03%) index, closed in green. The Insurance (+2.3%) index led the gainers, followed by the Banking (+1.6%), Oil & Gas (+0.2%), and Consumer Goods (+0.1%) indices, respectively.
 
Market sentiment, as measured by the market breadth, was positive (2.3x), as 23 tickers gained relative to 10 losers. MANSARD (+9.7%) and UACN (+8.7%) topped the gainers list, while CAP (-9.9%) and TOTAL (-9.9%) were the top losers of the day.

CURRENCY

The naira depreciated by 0.3% and 0.2% to NGN389.00/USD and NGN474.00/USD, at the I&E window and parallel market, respectively.

MONEY MARKET & FIXED INCOME

The overnight lending rate contracted by 425bps to 10.1%, amid the still pressured system liquidity.
 
Trading in the NTB secondary market was bullish, as average yield declined by 4bps to 1.7%. Across the curve, average yield contracted at the short (-5bps) and mid (-7bps) segments, due to demand for the 23DTM (-27bps) and 163DTM (-20bps) instruments, respectively. Yield was flat at the long end. Similarly, average yield contracted by 32bps to 3.7% at the OMO secondary market.
 
Elsewhere, trading in the Treasury bond secondary market was bearish, as average yield expanded by 30bps to 7.4%. Across the curve, average yield pared at the short (-1bp) end, following slight interest in the JUL-2021 (-1bp) bond, while it expanded at the long (+75bps) end, as investors sold off the JUL-2034 (+159bps) bonds; yield was flat at the mid segment.

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