March 30, 2017/InvestmentOne Research

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• The Nigerian bourse halted the bearish trend of the last two trading sessions as the benchmark; NSE-ASI gained +1.05% to close at 25,533.82pts, buoyed by positive investors’ sentiments on tickers across sectors.
• Buying interest in DANGCEM (+148.84pts), NB (+23.08pts) and ZENITHBANK (+20.11pts) was largely responsible for the positive close in the index offsetting the decline in GUINNESS (-3.50pts), UACN (-1.68pts) and TRANSCORP (-1.18pts).
• Market breadth index (+0.15x), a gauge of investors sentiment closed positive as 24 stocks led by AIRSERVICE (+9.54%) advanced compared to 9 losers topped by CCNN (-4.89%).
• Performance of the major sectoral indexes was positive as Banking (+1.16%), Industrial (+1.01%), Oil & Gas (+0.75%) and Consumer (+0.63%) trackers closed in the green.
• Activity level was however mixed as investors exchanged 294m units of stocks valued at c.N2.36bn in 2,438 deals. This represents -44% decline in volume traded and a +7% uptick in value turnover.
• In the near term, we expect the ASI to remain volatile given investors’ attraction to decent return in the Fixed Income space amidst fragile macro situation. That said, we however see likelihood of a shift in the FX policy regime as a potential catalyst for a rebound in equities’ performance. Hence, we advise investors to tread with caution while seeking decent entry point to build position in quality names over an extended investment horizon.

CURRENCY:

• At the interbank market, the NGN continued to close at N306 levels against the USD. However, the NGN lost -0.81% to N382.88 against the GBP while it remained relatively flat at N329 against the EUR.
• While the NGN gained +1.08% to N465 against the GBP at the parallel market, its lost -2.44% to N410 against the EUR and -0.80% to N383 against the USD.
• Going forward, the NGN may see support at the parallel market following the sale of $25.09m by IMTO to BDCs and CBNs continued intervention.
  

FIXED INCOME:

• Despite c.N50bn worth of OMO bills that matured today, money market rates increased across all tenors. The 1month and 3month NIBOR rates increased by 11bps and 26bps to 16.46% and 21.39% respectively, while the 6month NIBOR rate inched up by 10bps to 23.35%. The upward trend in money market rates may not be unconnected with CBN conducting another OMO auction today selling N42bn at 18.60% stop rate.
• Investors were largely bearish in the bond market today as yields expanded across the curve. The increase in yields may not be unconnected with the announcement of a FX and OMO auction by CBN. Although the yield on the 5yr and 7yr benchmark bonds were flat at 15.64% and 15.62% respectively, the yield on the 10yr benchmark bond increased by 18bps to 15.98%.
• Going forward, we expect market activity to be influenced by liquidity levels.
  

Below are key NSE statistics as at the end of trades:

Please find below the NASD OTC pricelist for Thursday 30^th of March 2017.