April 3, 2018/Cordros Report
EQUITIES
- Investors started the month on a bearish note, with the ASI closing lower by 1.56% to 40,855.64 points, as profit taking resurfaced across major sectors.
- Accordingly, the Year-to-Date gain dropped to 6.83%.
- All sector indices posted losses, led by the Industrial Goods (-3.35%) index, and followed by the Consumer Goods (-0.60%), Oil & Gas (-0.49%), Banking (-0.42%), and Insurance (-0.06%) indices. Notable stocks that sparked the losses include DANGCEM (-3.46%), DANGSUGAR (-3.67%), JAPAULOIL (-6.78%), GUARANTY (-2.91%), and LINKASSURE (-4.82%) respectively.
- Market breadth remained negative, with 36 losers and 11 gainers, led by FIDELITYBK (-9.33%) and CAVERTON (+8.99%). Total volume of trades was higher by 34.15% to 365.72 million, valued at NGN6.27 billion (+68.75%), and exchanged in 4,173 deals.
- Our theme on risky assets remains stability despite persisting selloffs, on the back of still-positive macroeconomic fundamentals.
CURRENCY
- The USD/NGN weakened by 0.05% to NGN360.21 in the I&E FX window, while it remained flat at NGN362 in the parallel market. Total turnover in the I&E FX window dropped by 30.36% to USD270.04 million, consummated within the NGN320 and NGN361.35/USD range.
FIXED INCOME
- The overnight lending rate dropped by 366 bps to 4.42%, against Friday’s close of 8.08%, as funds from the monthly FAAC disbursement offered a boost to system liquidity – in addition to the apex bank conducting no OMO auction.
- Average yield contracted by 18 bps to 14.56% in the NTB market. High demand for the 86DTM (-101 bps), 93DTM (-96 bps), and 184DTM (-51bps) bills caused contractions at the short (-33 bps), mid (-17 bps), and long (-11 bps) ends of the curve, respectively. At the NTB auction scheduled for tomorrow, the CBN is expected to offer NGN95.20 billion – NGN9.52billion of the 91-day, NGN47.60 billion of the 182-day, and NGN38.08 billion of the 364-day – worth of bills to the market.
- Similarly, activities turned bullish in the bond market, as average yield declined by 5 bps to 13.64%. Yields fell across all ends of the curve – short (-9 bps), mid (-3 bps), and long (-3 bps) – driven by demand for the JAN-2022 (-12 bps), MAR-2027 (-10 bps), and MAR-2036 (-13 bps) bonds, respectively.
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