Bears continues onslaught on Nigerian bourse as index down 0.53% Tuesday

Proceedings in the Nigerian equities market sustained its bearish run on Tuesday as the benchmark index declined by 0.53 per cent to 31,178.71 points, following selloffs across Tier I and II banking stocks.

Against that backdrop, the Month-to-Date loss increased to 0.80 per cent.

On sectoral performance, the Banking (-1.45%), Consumer Goods (-0.56%), Oil & Gas (-0.13%) and Insurance (-0.23%) indices closed negative on the back of losses in ZENITHBANK (-2.13%), NB (-2.38%), OANDO (-0.98%), and LINKASSURE (-9.68%). Meanwhile, the Industrial Goods index closed flat.

Market breadth was negative with 29 losers and 14 gainers, led by REDSTAREX (-10.00%) and ACADEMY (+10.00%) respectively. Meanwhile, total volume and value traded increased by 61.4 per cent and 3.8 per cent to 359.51 million units and NGN1.91billion, respectively, and exchanged in 3,773 deals.

“Our outlook for equities in the near-to-medium term is negative, and we guide investors to trade cautiously, amidst political jitters ahead of the upcoming elections. However, macroeconomic fundamentals remain stable and supportive of recovery in the long term”. Analysts at Cordros Capital said.

In the currency USD/NGN weakened by 0.16 per cent  to NGN363.34 at the I&E FX window, while it remained flat at NGN363.00 in the parallel market. Total turnover in the IEW moderated by 67 per cent  to USD93.84 million in the previous session, with trades executed within the NGN360.00-363.75/USD band.

In the currency market, overnight lending rate moderated by 648 bps to 10.83 per cent. The CBN conducted an OMO auction wherein NGN77.79 billion – NGN10.47 billion of the 86DTM, NGN12.25 billion of the 198DTM, and NGN55.07 billion of the 282DTM – worth of bills were sold at respective stop rates of 11.90 per cent,13.50 per cent and 15.00 per cent.

Trading in the treasury bills market was bullish, as average yield moderated by 5 bps to 14.86%. Buy sentiment was spread across the short (-2 bps), mid (-7 bps) and long (-6 bps) segments, driven by demand for the 44DTM (-35 bps), 93DTM (-52 bps) and 226DTM (-19 bps) respectively. At the NTB auction scheduled for tomorrow, the CBN will offer NGN254.64 billion – NGN7.85 billion of the 91-day, NGN69.57 billion of the 182-day, and NGN177.22 billion of the 364-day – worth of bills to the market.

Proceedings in the bond market were also bullish as average yield shed 4 bps to 15.11%. Demand was spread across the short (-10 bps), mid (-1 bp) and long (-2 bps) segments amidst interest in the JUL-2021 (-21 bps), JAN-2026 (-10 bps) and JUL-2034 (-5 bps) bonds, respectively. At the FGN bond auction scheduled for tomorrow, the DMO is expected to offer NGN150 billion – NGN50 billion of the APR-2023 (reopening), NGN50 billion of the MAR-2025 (re-opening), and NGN50 billion of the FEB 2028 (re-opening) – in bonds to investors.