May 10, 2019/InvestmentOne Report

Please click to download the Market Report for Friday 10^th May 2019

EQUITY:

• The Nigerian equities market closed the last trading session of the week in red, losing 0.17%. WTD, the equities market was down by 1.25%.  
• Similarly, market breadth index was negative with 13 gainers against 27 losers.
• Today’s performance was driven by the selloffs in ABCTRANS (-10.00%), SEPLAT (-9.98%), AFRIPRUD (-9.92%), NEIMETH (-9.09%) and CHAMS (-9.09%) which offset the gains in SOVRENINS (+8.70%), NEM (+7.76%), PRESTIGE (+6.38%), STANBIC (+5.26%) and ROYALEX (+4.35%).
• Sector performances were negative with Oil & Gas (-4.51%) having the worst performance, followed by Banking (-0.26%). While Consumer Goods (+0.13%) closed positive, Industrial was flat.
• In terms of activity levels, while total volume increased by 9.30%, total value declined by 34% compared to yesterday, as investors exchanged 235million units of shares worth N1.36billion. SOVRENINS (+8.70%) was the most actively traded stock with about 45million units of shares worth N11million.
• Despite the recent recovery in the equities market, we believe prices at current levels present decent entry opportunities for bargain hunting investors with medium to long term horizon.
  

CURRENCY:

·         At the IEFX window, while the Naira lost 0.11% and 0.09% against the GBP and EUR to close at N468.50 and N404.21 respectively, it gained 0.06% against the USD to close at N360.88.

·         At the Parallel market, the Naira closed flat at N360, N472 and N402 against the USD, GBP and EUR respectively.

·         Going forward, we expect the FX market to continue to see support from CBN’s intervention sales.                                                                                                                                                                        

FIXED INCOME:

·         Money market rates increased today as Overnight rate and Open Buy Back rate rose by 429bps and 443bps to close at 10.00% and 9.14% respectively. We believe this may not be unconnected to the withdrawal for FX auction which could have led to a squeeze in system liquidity.

·         The bond market was positive today as yields declined across most tenors. While the yield on the 5yr benchmark bond increased by 5bps, the yields on the 7yr and 10yr benchmark bonds declined by 19bps each to close at 14.33% and 14.23% respectively.

·         In the near term, we expect market activity to be influenced by liquidity levels and foreign investor participation.

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