Nigerian equities market opens the week positive as Index up 0.57% on Monday

Following the conclusion of the general election, sentiments in the Nigerian equities market turned positive as the benchmark index of The Nigerian Stock Exchange (NSE) notched higher by 0.57 per cent to 32,568.65 points, driven by interest across major counters.

Accordingly, the Month-to-Date and Year-to-Date gains increased slightly to 7.01 per cent and 4.04 per cent, respectively.

On sectorial breakdown, all sector indices close positive, led by the Consumer Goods (+1.26%) index, and followed closely by the Insurance (+1.13%), Banking (+0.85%), Oil & Gas (+0.05%), and Industrial Goods (+0.02%) indices. Notable stocks include NB (+4.00%), AIICO (+4.23%), ZENITH (+0.97%), OANDO (+1.54%), and DANGCEM (+0.05%).

Elsewhere, market breadth was positive, with 25 gainers and 8 losers, led by DANGFLOUR (+9.95%) and UNIONDAC (-6.45%) shares, respectively. Total volume of trades declined by 0.7 per cent to 219.81 million units, valued at NGN5.55 billion, and exchanged in 4,327 deals.

In the absence of a positive catalyst, as well as the still tense political milieu, we guide investors to trade cautiously in the short term. However, stable macroeconomic fundamentals and compelling valuations remain supportive of recovery in the mid-to-long term.

In the currency market, the naira traded flat against the dollar at NGN360 in the parallel market, while it depreciated slightly by 0.01 per cent to NGN361.54 in the I&E FX window. Total volume of trades in the IEW rose by 43.4 per cent to USD165.32 million in Friday’s session, with trades consummated within the NGN359.00-NGN363.00/USD band.

In the fixed income and money market, the overnight lending rate moderated by 146 bps to 18.79 per cent, following inflows worth NGN38.97 billion from the JAN-2028 bond coupon payments.

Activities in the Treasury bills market were bullish, as average yield contracted by 8 bps to close at 14.26 per cent. Yields compressed at the short (-43 bps), mid (-63 bps) and long (-10 bps) ends of the curve, following demand for the 80DTM (-136 bps), 171DTM (-304 bps), and 206DTM (-105 bps) bills, respectively.

Proceedings in the bond market were similarly bullish, as average yield compressed by 16 bps to 14.50 per cent. Buy sentiment was spread across the short (-29 bps) and mid (-19 bps) segments, driven by demand for the JUL-2021 (-58 bps) and JAN-2026 (-34 bps) bonds, respectively. Conversely, yield expanded at the long (+6 bps) end of curve, following a selloff of the JUL-2034 (+22 bps) bond.