Nigerian equities market opens the week strong, as Index up 0.95% Monday
The Nigerian equities market kicked off the week with a positive start as the ASI notched higher by 0.95 per cent to 32,129.94 points, following gains across heavyweight stocks.
Accordingly, the Month-to-Date and Year-to-Date returns increased to 1.30% and 2.23%, respectively.
Across sector indices, the Banking (+2.66%), Consumer Goods (+0.43%), and Industrial Goods (+0.31%) indices closed positive, driven by gains across GUARANTY (+4.79%), DANGFLOUR (+5.05%), and DANGCEM (+0.20%) shares, respectively. Meanwhile, the Insurance (-0.21%) index closed negative, following sell-offs in NEM (-2.40%) shares. The Oil & Gas index was flat.
Market breadth was positive with 24 gainers and 10 losers, led by CUTIX (+9.76%) and PZ (-9.67%) stocks respectively. Total volume traded declined by 33.2% to 228.48 million units, valued at NGN2.61 billion, and exchanged in 3,544 deals.
“Amidst the still sensitive political landscape, we still hold the view that the blend of compelling valuation story, together with positive macroeconomic picture, leaves scope for market recovery in the medium-to-long term. However, we guide investors to tread a cautious trading path in the short term”, investors at Cordros Capital said.
The USD/NGN strengthened slightly by 0.01% to NGN360.98 in the I&E FX window, but closed flat at NGN360.00 at the parallel market respectively. Total turnover in the IEW moderated by 49.2% to USD959.02 million, with trades consummated within the NGN355.00-362.10/USD band at the currency market on Monday.
In the fixed income and money market, the overnight lending rate rose 250 bps to 14.92%, from 17.42% last Friday, amidst funding for the FX wholesale auction, and the CBN’s OMO auction, wherein NGN184.04 billion – NGN70.84billion of the 94DTM, and NGN113.20 billion of the 192DTM bill – worth of bills were sold at respective stop rates of 11.90% and 13.50%.
The treasury bills market saw a reversal in the recent bullish sentiments, as average yield expanded by bps to 13.09%. Sell pressure was evident across short (-14 bps) and mid (+40 bps) segments, with the 94DTM (+107 bps) and 108DTM (+84 bps) bills recording respective expansions. Conversely, demand for the 332DTM (-115 bps) led to yield compression at the long (-4 bps) end of the curve.
The bears also dominated in the bond market, as average yield notched higher by 5 bps to 14.00%. Sell pressure was spread across the short (+3), mid (+3 bps) and long (+13 bps) segments, with investors dumping the FEB-2020 (+33 bps), JUL-2030 (+9 bps), and MAR-2037 (+31 bps) papers, respectively.
