May 8, 2017/Cordros Research
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EQUITIES
- The equities market fired on, owing to demand for insurance and consumer goods names. The All Share Index climbed 0.70% to close at 26,418.33 points.
- Today’s performance increased the Month-to-Date gain to 2.56% and reduced the Year-to-Date loss to 1.70%.
- The Consumer Goods (+1.96%) index advanced, with 7UP (+9.72%), NESTLE (+3.40%), UNILEVER (+3.03%), and NB (+2.12%) being the toast of investors. Likewise, the Banking (+0.38%), Insurance (+1.84%) and Oil & Gas (+1.39%) indices closed higher, owing to demand for GUARANTY (+1.31%), ZENITHBANK (+0.19%), MANSARD (+1.35%), CONTINSURE (+9.40%), OANDO (+9.72%), and ETERNA (+4.24%) shares respectively. The Industrial Goods (-0.02%) index bucked the trend, as traders liquidated their holdings in CCNN (-1.96%).
- Market breadth was positive, with 26 gainers versus 12 losers. Total volume traded declined by 39.56% to 267.64 million shares, valued at N3.26 billion, and exchanged in 3,907 deals.
- Devoid of strong fundamentals to suggest otherwise, we expect the short term bullish trend to continue.
CURRENCY
- The apex bank offered USD100 million in forward contracts today. That said, the USD/NGN (+0.16%) and EUR/NGN (+1.51%) strengthened to N305.20 and N343.95 respectively, while the GBP/NGN (-0.40%) weakened to N413.88. In the parallel market, the LCY strengthened by 1.00% against the pound to N495.00, while it shed 0.71% against the euro to N425 and remained flat against the dollar at N391. Meanwhile, at the Investors’ and Exporters FX (IEFX) market, the USD/NGN (+0.49%) strengthened to N380.31.
FIXED INCOME AND INTERBANK
- The overnight rate contracted by 133 bps to 17.92%, owing to the lingering impact of the N87.62 billion OMO bill maturity last week.
- The treasury bills market closed on a bearish note, with average yield expanding by 3 bps to 18.41%. Yields at the short (+9 bps), mid, and long (+1 bp apiece) ends of the curve were pressured, as investors sold-off the 6-JUL-17 (+47 bps), 10-AUG-17 (+21 bps), and 23-NOV-17 (+13 bps) maturities respectively.
- Similarly, investors were downbeat in the bonds space, with average yield expanding by 6 bps to 16.89%. Yields at the short (+33 bps) and mid (+ 4 bps) ends were pressured, owing to selloffs in the MAY 2018 (+73 bps) and MAR 2019 (+18 bps) bonds respectively. Demand was modest at the long (+1 bp) end, as investors demanded the APR 2037 (-4 bps) maturity.
