May 10, 2018/Cordros Capital
EQUITIES
- The bears continued to dominate the equities market, as the ASI dipped further, by 0.40%, to 40,915.17 points.
- The Month-to-Date and Year-to-Date returns dipped to -0.85% and 6.99%, respectively.
- The Oil & Gas (-1.80%) index recorded the largest loss, followed by the Consumer Goods (-0.13%) and Banking (-0.02%) indices, owing to selloffs of SEPLAT (-3.33%), DANGSUGAR (-1.07%), and WEMABANK (-4.55%) shares respectively. On the flip side, the Industrial Goods (+0.06%) and Insurance (+0.02%) indices closed in the green, following gains in the shares of CCNN (+9.96%) and LINKASSURE (+4.60%) respectively.
- Market breadth remained negative, with 26 losers and 22 gainers, led by NIGERINS (-7.41%) and CCNN (+9.96%) respectively. Total volume and value of trades decreased by 28.19% and 59.06% to 244.92 million units and NGN4.10 billion, respectively, exchanged in 3,804 deals.
- Our medium-to-long-term outlook for risky assets remains positive, amidst still-positive macroeconomic fundamentals.
CURRENCY
- The USD/NGN rate was flat at NGN363 in the parallel market, while it depreciated by 0.06% to NGN361.36 in the I&E FX window. Total turnover in the I&E FX window rose by 167.41% to USD500.37 million (highest since 5th April), consummated within the NGN314.50-NGN363/USD band.
FIXED INCOME AND MONEY MARKET
- The overnight lending rate surged 1,113 bps to 18.88% (highest since 27th March, 2018), as the CBN mopped up today’s inflow of OMO bills (NGN290.92 billion) via OMO auction. The apex bank sold a total of NGN454.16 billion — NGN2.98 billion of the 119DTM and NGN451.18 billion of the 231DTM — worth of bills at respective stop rates of 11.05% and 12.15%.
- Sentiments were bearish in the NTB secondary market, following an increase in offer yields of long dated bills at the OMO auction from 12.00% to 12.15%. Consequently, average yield rose by 41 bps to 12.18%. Selloffs of the 91DTM (+109 bps), 133DTM (+112 bps), and 231DTM (+125 bps) bills led to yield expansion at the short (+46 bps), mid (+34 bps), and long (+43 bps) ends of the curve.
- Similarly, bearish sentiments persisted in the bond market, as yield rose by 2 bps on average, to 13.05%. Selloffs of the JAN-2022 (+18 bps) and MAR-2024 (+27 bps) bonds led to yield expansion at the short (+6 bps) and mid (+6 bps) segments. Conversely, there was demand pressure at the long (-8 bps) end of the curve, with the MAR-2036 (-21 bps) bond recording the largest contraction.
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