Nigerian bourse halts bearish run as Index up 0.04%

The Nigerian equities market halted its 3-day bearish run to close on a positive note on Thursday as the benchmark index increased by a marginal 0.04 per cent to 29,171.73 points, driven by gains in bellwether Consumer Goods stocks.

Thus, the Month-to-Date and the Year-to-Date losses moderated to -1.91 per cent and -7.19 per cent respectively.

On sectoral performance, the Industrial Goods (+0.46%), Consumer Goods (+0.39%), Insurance (+0.35%), and Oil & Gas (+0.07%) indices gained, while the Banking index (-0.52%) closed in red.

Notable stocks include CCNN (+4.29%), NB (+1.15%), NEM (+2.67%), MOBIL (+5.08%) and UBA (-2.21%), respectively.

Market breadth was negative, with 26 losers and 21 gainers, led by AFROMEDIA (-10.00%) and TRANSCORP (+9.91%) stocks, respectively. Total volume of trades decreased by 48.49% to 279.61 million units, valued at NGN2.82 billion, and exchanged in 4,836.00 deals.

Analysts at Cordros Capital believes that 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”.

In the currency market, the USD/NGN depreciated by 0.08 per cent to NGN360.91 in the I&E FX window, but closed flat at NGN360.00 at the parallel market. Total turnover in the IEW increased by 6.39 per cent to USD176.34 million, with trades consummated within the NGN345-NGN362.00/USD band.

In the money & fixed income markets, the overnight lending rate moderated by 254 bps to 7.29 per cent as today’s inflow of matured OMO bills (NGN62.80 billion) boosted system liquidity.

Activities in the treasury bills market were mixed, but with a bullish tilt, as average yield compressed 2 bps to close at 13.07 per cent. Demand for the 91DTM (-70 bps) and 105DTM (-27bps) led to yield contraction at the short (-11 bps) and mid (-8 bps) segments of the curve, respectively.

Conversely, a selloff of the 336DTM (+16 bps) led to yield expansion at the long (+2 bps) end of the curve. At today’s primary auction, the CBN fully allotted NGN109.71 billion – NGN28.02 billion of the 91DTM, NGN10.62 billion of the 182DTM, and NGN71.07 billion of the 364DTM – worth of bills at respective stop rates of 10.00 per cent (previously 10.1499%), 12.49 per cent (previously 12.50%), and 12.77 per cent (previously 12.74%).

Trading in the bond market was also mixed, with a bullish tilt, as average yield contracted by 2 bps to close at 14.23 per cent. Demand for the JUN-2019 (-15 bps) and MAR-2036 (-6 bps) bonds led to yield contraction at the short (-4 bps) and long (-2 bps) ends of the curve, respectively. On the flip side, sell pressure was concentrated at the mid (+2 bps) segment, with yield on the MAR-2027 (+10 bps) bond expanding