Bull sustains rally on NSE as Index up 0.81% Monday

Proceedings in the Nigerian equities market sustained its bullish run from last week, as the ASI closed in the positive zone for the seventh straight session on Monday.

Specifically, the benchmark index notched slightly higher by 0.81 per cent to close at 31,529.92 points, on account of buying sentiments across major counters.

Against that backdrop, the Month-to-Date and Year-to-Date returns increased to 4.01 per cent and 1.12 per cent respectively.

The sectoral breakdown shows that all sector indices closed positive, with the Banking (+1.90%) index topping the charts, followed closely by the Insurance (+1.20%), Oil and Gas (+0.58%), Consumer Goods (+0.42%) and Industrial Goods (+0.31) indices respectively. Notable stocks include ZENITHBANK (+2.25%), AIICO (+6.94%), OANDO (+10.00%), DANGFLOUR (+9.49%) and BETAGLAS (+9.55%).

Market breadth was positive, with 40 gainers and 10 losers, led by LASACO (+10.00%) and CILEASING (-9.96%) respectively. Meanwhile, volume and value traded moderated sharply by 23.8 per cent and 53.7 per cent to 551.59 million units and NGN5.65 billion respectively, and consummated in 5,229 deals.

“Our outlook for equities in the near-to-medium term remain conservative, and we guide investors to trade cautiously, amidst absence of a near term catalyst and political jitters ahead of the upcoming 2019 elections. However, macroeconomic fundamentals remain stable and supportive of recovery in the long term”, analysts at Cordros Capital said.

In the currency market, USD/NGN depreciated by 0.06 per cent to NGN361.95 at the I&E FX window, but remained flat at NGN361 in the parallel market.

Total turnover in the IEW increased by 4.5 per cent to USD328.47 million, with trades consummated within the NGN315.00-363.00/USD band.

In the fixed income and money market, the overnight lending rate surged by 2,808 bps to 47.50 per cent as banks funded for the wholesale FX auction.

In addition, the CBN continued its OMO interventions, mopping up NGN38.36 billion – NGN2.41 billion of the 94DTM, NGN1.08 billion of the 178DTM, and NGN34.87 of the 360DTM bills – from the system at respective stop rates of 11.90 per cent, 13.50 per cent and 15.00 per cent respectively.

Activities in the Treasury bills market were bearish as average yield expanded by 4 bps to close at 14.65 prt cent. Sell pressure was spread across the short (+10 bps), mid (+3 bps) and long (+1 bps) segments.  Notable bills include the 10DTM (+136 bps), 171DTM (+25 bps) and 283DTM (+58 bps) respectively.

Similarly, proceedings in the bond market were also bearish, as average yield expanded by 3 bps to 14.65 per cent. Yield expanded at the short (+5 bps), mid (+1 bps) and long (+4 bps) segments, driven by selloffs of the JUN-2019 (+21 bps), JUL-2030 (+8 bps) and MAR-2036 (+13 bps) bonds, respectively.