Bulls Sustain Hold on Nigerian Bourse as Bellwether Stocks Up Indices +1.1%

October 21, 2021/Cordros Report

EQUITIES

Credit: theguardian.com

Bullish sentiments persisted in the Nigerian equities market, as investors’ interests in bellwethers – BUACEMENT (+6.1%), MTNN (+1.2%) and AIRTELAFRI (+1.3%) led the All-Share Index to close 1.1% higher at 41,704.11 points. Consequently, Month-to-Date and Year-to-Date gains increased to +3.7% and +3.6%, respectively.

The total volume of trades declined by 56.7% to 216.19 million units, valued at NGN3.38 billion, and exchanged in 4,272 deals. FBNH was the most traded stock by volume at 51.92 million units, while AIRTELAFRI was the most traded stock by value at NGN722.16 million.

Performance across sectors was broadly positive as all sectors under our coverage – Industrial Goods (+2.2%), Insurance (+1.6%), Consumer Goods (+1.5%) and Banking (+0.2%) – save for the Oil & Gas (-0.4%) index recorded gains.

As measured by market breadth, market sentiment was positive (1.4x), as 23 tickers gained relative to 16 losers. CUTIX (+10.0%) and NGXGROUP (+9.8%) recorded the most significant gains while NIEMETH (-4.9%) and UNIVINSURE (-4.8%) topped the losers’ list.

CURRENCY

The naira depreciated by 0.2% to NGN415.07/USD at the I&E window.

MONEY MARKET & FIXED INCOME

The overnight lending rate expanded by 50bps to 15.5% in the absence of significant inflows into the system.

The NTB secondary market closed on a bearish note, as the average yield expanded by 37bps to 5.4%. Across the benchmark curve, average yield was unchanged at the short end but closed higher at the mid (+58bps) and long (+39bps) segments as market participants sold off the 161DTM (+96bps) and 189DTM (+132bps) bills, respectively. Similarly, the average yield at the OMO segment expanded by 15bps to 6.5%.

Trading in the Treasury bond secondary market was also bearish, as the average yield expanded by 4bps to 11.3%. Across the benchmark curve, average yield expanded at the short (+10bps) and mid (+5bps) segments driven by sell pressures on the JAN-2022 (+18bps) and MAR-2037 (+21bps) bonds, respectively. However, it pared at the long (-1bp) end following investors’ demand for the MAR-2050 (-4bps) bond.

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