July 26, 2017/Cordros Research
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EQUITIES
- The bulls continued to dominate the equities market recording gains across board. The ASI increased by 3.40% and crossed the 36,740.77 points – the highest since November, 2014.
- Today’s performance improved the Month-to-Date and Year-to-Date returns to 10.94% and 36.71%, respectively.
- The Banking (+3.72%) index recorded the largest gain following investor interest in GUARANTY (+4.99%), ZENITH (+6.67%), STANBIC (+4.98%) and ACCESS (+3.03%) shares. Bargain hunting also persisted in the Consumer Goods (+2.75%), Industrial Goods (+2.45%), Oil and Gas (+1.84%) and Insurance (+0.36%) segments, driven by NB (+5.00%), DANGCEM (+4.93%) as investors front load ahead of the Q2-17 earnings releases schedule for Friday, TOTAL (+4.28%) and CONTINSURE (+4.80%), respectively.
- Market breadth was positive with 31 gainers and 17 losers. Total volume traded increased by 16.20% to 335.34 million shares valued at N4.64 billion and crossed in 5,385 deals.
Corporate Releases: H1-2017; ALEX (PAT: N34.12 million vs. N60.19 million); UAC-PROP (PAT: -N2.06 billion vs. N34.28 million); PAINTCOM (PAT: N15.02 million vs. N34.77 million); CONTINSURE (PAT: N2.33 billion vs. N2.36 billion); NIGERINS (PAT: N76.12 million vs. N61.00 million); CADBURY (PAT: -N766.39 million vs. N147.15 million); HMARKINS (PAT: N119.08 million vs. N259.14 million)
- We expect investors to remain upbeat in the market in the coming session in anticipation of Q2 corporate releases.
CURRENCY
- At the time of writing, the naira strengthened against all the currencies we track in the interbank segment – NGN/USD (+0.02%), NGN/GBP (+0.13%) and NGN/EUR (+0.37%) closing at respective rates of N305.70, N410.49 and N366.02. In the parallel market, the NGN/USD (+0.27%) appreciated to N364 while the NGN/EUR (-0.95%) weakened to N424 and the NGN/GBP closed flat at N475. Meanwhile, in the I&E FX window, the NGN/USD (-0.53%) depreciated to N368.60.
FIXED INCOME AND MONEY MARKET
- The overnight rate contracted by 317 bps to 16.00% following reported reduction in system liquidity from the apex bank mop up of N60 billion today via OMO auction in an attempt to subdue the effect of the N65.03 billion worth of OMO bills maturing into the system tomorrow.
- The bears resurfaced in the bonds market with average yields expanding by 4 bps to 16.67%. Yield on the short (+19 bps) end of the curve expanded to 17.71% owing to sell-off in 30-MAY-2018 bond, while snippets of demand ensued at the mid (+1 bps) and long (< 1 bps) ends of the curve driven by investor interest in the 13-FEB-2020 and 18-APR-2037 bonds respectively.
- Conversely, the bulls continued to dominate the treasury bills space with average yields contracting by 5 bps to 17.56%. Yields at the short (-5 bps) and mid (-15 bps) segments contracted following demand for 14-SEP-2017 and 30-NOV-2017 bills while, yield at the long (+2 bps) end expanded owing to sell off of the 25-JAN-2018 bill.
