Nigerian Stocks Snap Three-Day Sell-Off on Bargain Buying in MTNN, Index Up +1.1%

L-R shows: Emeka Onwuka, Chief Financial Officer, Seplat Energy Plc; Kamarudeen Oladosu, Director, Nigerian Exchange Limited (NGX); Effiong Okon, Executive Director, Operations, Seplat Energy Plc; Dr. Ambrosie Bryant Chukwueloka Orjiako, immediate former Chairman, Seplat Energy Plc; Temi Popoola, Chief Executive Officer, NGX; Mr Basil Omiyi, Chairman, Seplat Energy Plc; and Mr Roger Brown, Chief Executive Officer, Seplat Energy Plc at the Closing Gong Ceremony to hosted to celebrate the immediate former Chairman and welcome the newly appointed Chairman of Seplat Energy Plc hosted on the Trading Floor of Nigerian Exchange Limited.. Image Credit: NGX

May 19, 2022/Cordros Report

EQUITIES

The equities market ended the day higher, as stocks snapped a three-day selloff on bargain buying in MTNN (+5.7%) stocks. Precisely, the All-Share Index inched higher by 1.1% to 53,275.49 points. Accordingly, the Month-to-Date and Year-to-Date returns increased to +7.3% and +24.7%, respectively.

The total volume of trades declined by 55.1% to 274.56 million units, valued at NGN8.45 billion, and exchanged in 5,184 deals. TRANSCORP was the most traded stock by volume at 48.38 million units, while MTNN was the most traded stock by value at NGN5.49 billion.

Sectoral performance was broadly negative, as the Insurance (-1.3%), Oil & Gas (-0.8%), Banking (-0.8%), and Consumer Goods (-0.2%) indices recorded losses, while the Industrial Goods (+0.1%) index posted gains.

As measured by market breadth, market sentiment was negative (0.7x), as 28 tickers lost relative to 20 gainers. CONOIL (-10.0%) and ETERNA (-9.6%) topped the losers’ list, while TRANSCOHOT (+9.9%) and BETAGLAS (+9.7%) recorded the highest gains of the day.

CURRENCY

The naira depreciated by 0.3% to NGN420.33/USD at the I&E window.

MONEY MARKET & FIXED INCOME

The overnight lending rate expanded by 13bps to 12.5% in the absence of any significant inflows in the system.

The NTB secondary market turned bearish as the average yield expanded by 2bps to 3.7%. Across the curve, the average yield expanded at the mid (+5bps) and long (+2bps) segments due to profit-taking on the 133DTM (+31bps) and 252DTM (+14bps) bills, respectively; the average yield was flat at the short end. Elsewhere, the average yield was unchanged at 4.0% in the OMO segment.

Activities in the Treasury bond secondary market were mixed, albeit with a bearish tilt, as the average yield expanded slightly by 1bp to 11.1%. Across the benchmark curve, the average yield was flat at the short end but contracted at the mid (-3bps) segment as investors demanded the APR-2029 (-5bps) bond. Conversely, the average expanded at the long (+4bps) end following sell-offs of the APR-2037 (+27bps) bonds.

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