October 10, 2019/InvestmentOne Report

Please click to download the Market Report for Thursday 10^th October 2019

EQUITY:

·         The Nigerian equities market continued its bearish run as NSE-ASI shed 0.06% to close at 26,583.75pts.

·         Similarly, market breadth index was negative with 15 losers against 8 gainers.          

·         Today’s performance was mainly due to the losses recorded in WAPIC (-8.57%), LINKASSURE (-7.84%), CUSTODIAN (-5.83%), HONYFLOUR (-5.00%) and ROYALEX (-4.76%) which offset the gains in LEARNAFRICA (+9.82%), LIVESTOCK (+9.30%), UCAP (+7.50%), ABCTRANS (+5.26%) and WEMABANK (+3.45%).

·         Sector performances were broadly negative today with Banking (-0.24%) emerging as the worst performer.  While Consumer Goods (-0.07%) and Industrial (-0.01%) closed in red, Oil & Gas closed flat.

·         In terms of activity levels, total volume declined by 39% while total value rose by 157% compared to yesterday as investors exchanged over 363million units of shares worth over N19.02billion. DANGCEM was the most actively traded stock with just over 115million units of shares worth about N16.63billion.

·         The equities market closed down today following the losses witnessed in most sectors. We maintain that investors should take positions in quality names with a medium to long time investment horizon as prices remain attractive at current levels. 

CURRENCY:

·         At the IEFX window, while the Naira inched up marginally by 0.01% against USD to close at N362.46, it lost 2.19% and 1.18% against GBP and EUR  to close at N447.30 and N397.73 respectively.

·         At the parallel market, the Naira closed flat at N360, N450 and N390 against 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 Open Buy Back and Overnight rates were up by 29bps and 43bps to close at 4.71% and 5.50% respectively. The increase in rates may not be unconnected to the OMO auction today which could have reduced system liquidity.

·         At the OMO auction today, CBN sold N18.91billion and N300billion of the 182-day and 364-day bills at respective stop rates of 11.79% and 13.39%.

·         The bond market performance was largely mixed today as yields moved in different directions across most maturities. While the yield on the 5yr benchmark bond was down by 4bps to 14.36%, the yields on the 7yr and 10yr benchmark bonds rose by 2bps and 5bps to close at 14.38% and 14.41% 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: