The Nigerian equities market sustained its recovery to close on a positive note on Thursday as the benchmark index increased by 0.53 per cent to 29,347.62 points, driven by gains in Banking stocks.
Thus, the Month-to-Date and the Year-to-Date losses moderated to -5.46 per cent and -6.63 per cent respectively.
On sectoral performance, the Insurance (+1.92%) index led the gainers, following a price appreciation in NEM (+10.00%). The Banking (+1.19%) and Industrial Goods (+0.82%) indices followed suit, with GUARANTY (+2.09%) and WAPCO (+3.90%) closing positive.
The Consumer Goods (-0.06%) was the sole loser, weighed by a decline in FLOURMIL (-2.35%). The Oil & Gas index closed flat.
Market breadth was positive, with 15 gainers and 7 losers led by NEM (+10.00%) and IKEJAHOTEL (-9.76%) shares, respectively. Total volume of trades decreased by 53.5% to 224.03 million units, valued at NGN2.01 billion and exchanged in 3,127 deals.
“In the absence of a positive catalyst, we guide investors to trade cautiously in the short term. However, stable macroeconomic fundamentals and compelling valuation remain supportive of recovery in the mid-to-long term”, analysts at Cordros Capital said.
In the currency market, the USD/NGN appreciated by 0.05 per cent to NGN360.14 in the I&E FX window, but closed flat at NGN360.00 at the parallel market. Total turnover in the IEW decreased by 38.87 per cent to USD132.88 million, with trades consummated within the NGN357.50-NGN362.00/USD band
The overnight lending rate contracted by 571 bps to 10.57 per cent following inflows of matured OMO bills (NGN33,02 billion), and in the absence of any OMO intervention by the CBN.
Sentiments in the treasury bills market were mixed, albeit with a bullish tilt as average yield fell marginally (-1 bp) to close at 13.28 per cent. Buy sentiment was concentrated at the long (-5 bps) end of the curve, with the 238DTM (-21 bps) recording the most significant contraction. Conversely, selloffs of the 35DTM (+33 bps) and 98DTM (+127 bps) bills led to respective yield expansions at the short (+1 bp) and mid (+4 bps) segments.
Activities in the bond market were bearish, as average yield expanded by 11 bps to 14.36 per cent. Sell pressure was concentrated at the short (+29 bps) end of the curve, with yield on the JUN-2019 (+95 bps) bond expanding. On the flip side, demand for the JUL-2030 (-5 bps) and MAR-2036 (-8 bps) bonds led to yield contraction at the mid (+1 bp) and long (-5 bps) segments, respectively.