Nigerian bourse down 2.37% Wednesday

The bears resurfaced strongly in the Nigerian equities market, as the market All-Share Index (ASI) fell by 2.37 per cent to 32,403.60 points, following significant sell pressure in the market’s heavyweight, Dangote Cement.

Consequently, the Month-to-Date (-1.11 per cent) return turned negative, while the Year-to-Date loss increased to -15.27 per cent.

DANGCEM shares plummeted 6.76 per cent,  its largest daily loss since June 1st – leading to the significant drop in the Industrial Goods (-4.14 per cent) index. The Consumer Goods (-1.20 per cent) and Oil and Gas (-0.24 per cent) indices also closed negative, following significant sell pressure in the shares of FLOURMILL (-4.15 per cent) and OANDO (-2.78 per cent), respectively.

Meanwhile, the Banking (+0.53 per cent) and Insurance (+0.41 per cent) indices closed positive, owing to demand for DIAMONDBNK (+9.45 per cent) and LAWUNION (+7.69 per cent) shares, respectively.

Market breadth turned positive with 17 gainers and 15 losers, led by DIAMONDBNK (+9.45 per cent) and TRANSEXPR (-8.45 per cent) respectively. Total volume of trades rose by 105.71 per cent to 380.97 million units, valued at NGN2.33 billion, and exchanged in 3,278 deals.

“We reiterate our negative outlook for the equities market in the short to medium term, amidst political concerns in the 2019 elections and absence of a positive market trigger. However, positive macroeconomic fundamentals remain supportive of recovery in the long term”. Analysts at Cordros Capital said.

In a related development, The naira weakened against the dollar by 0.02 per cent to NGN364.01 in the I&E FX window, while it continued to trade flat at NGN362 in the parallel market.

Total turnover in the IEW fell by 21.52 per cent to USD192.03 million, with trades consummated within the NGN358.00-NGN365.00/USD band.

The overnight lending rate expanded by 143 bps, closing at 17.21 per cent, in the absence of any significant inflows.

Proceedings in the NTB market were bearish, as average yield rose by 14 bps to 13.70 per cent. There were selloffs across the short (+15 bps), mid (+16 bps), and long (+5 bps) ends of the curve, with yields on the 92DTM (+32 bps), 148DTM (+43 bps), and 344DTM (+30 bps) bills contracting, respectively.

Also,bearish sentiments persisted in the bond market, as average yield expanded by 4bps, to 15.00 per cent. Yields expanded at the short (+7 bps) and mid (+4 bps) segments, following selloffs of the JUN-2019 (+28 bps) and JAN-2026 (+10 bps) bonds, respectively.

Yield at the long end of the curve was flat. At today’s primary auction, the DMO allotted a total of NGN88.08 billion – NGN12.65 billion of the APR-2023 (re-opening), NGN20.14 billion of the MAR-2025 (re-opening), and NGN55.29 billion of the FEB-2028 (re-opening) – in bonds, at respective stop rates of 15.00 per cent (same as previous auction), 15.15 per cent (same as previous auction), and 15.3398 per cent (vs. 15.2459 per cent at the previous auction).