November 9, 2017/InvestmentOne Research

Please click to download the Market Report for Thursday 9^th November 2017

 EQUITIES:  

• The equities market closed negative today, as the declines in bellwether stocks; DANGCEM (-98pts), ZENITHBANK (-44pts) and NB (-20pts), more than offset the gains in INTBREW (+36pts), GUARANTY (+34pts) and MOBIL (+13pts).
• Consequently, the ASI shed -0.24% to close at 37,051.54pts representing a market capitalisation of N12.82tr.
• Market breadth index also ended in the red (-0.01x) as 21 stocks gained compared with 22 stocks that declined. CARVERTON (+9.46%) led the gainers’ chart while LAWUNION (-4.62%) was the worst performer.
• Major sector performance was mixed as Industrial (-0.47%) and Banking (-0.29%) ended in the red while Oil & Gas (+1.23%) and Consumer Goods (+0.06%) gained.
• Although the total volume of shares traded fell by -9%, compared to yesterday, the total value of shares exchanged jumped +95% as investors exchanged 176m units of shares worth N3.52bn. GUARANTY (+0.95%) was the most actively traded stock with 34m units worth N1.4bn.
• Going forward, we expect the ASI to remain volatile in the absence of a positive catalyst to drive the market further. However, we see the recent sell-off as an entry opportunity in our recommended quality names.

CURRENCY:

• While the NGN gained +0.06% against the USD to close at N360.55 at the I&E FX window, the NGN lost -0.10% and -0.24% against the GBP and EUR to close at N471.97 and N418.63 respectively.
• At the parallel market segment, the NGN was flat against the USD, GBP and EUR to close at N363, N420 and N475 respectively.
• Going forward, we retain our view that CBN’s regular intervention in the market will be supportive of the Naira.
  

FIXED INCOME:

·         The money market rates declined significantly today, Overnight and Open Buy Back rates fell by 1,450bps and 1,367bps to close at 7.83% and 7.17% respectively. This decline in rates may not be unconnected to the N233.76bn OMO maturity that hit the system today.

·         At the OMO auction today, CBN sold N238m for 105-day bill at a stop rate of 16.00% and N82.99bn for 196-day bill at a stop rate of 17.80%.

·         NIBOR rates also declined across the curves today, 1-month, 3-month and 6-month fell by 75bps, 46bps and 26bps to close at 19.18%, 20.74% and 22.78% respectively.

·         In the bond market, the yields on the 5yr and 7yr benchmark bonds closed flat at 14.83% and 15.12% respectively but the yield on the 10yr benchmark bond fell by 8bps to close 15.12%.

·         Going forward, we expect market activities to be determined by the level of liquidity in the system as well as foreign investors’ participation in the market. 

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