October 21, 2019/Cordros Report

Equities

The bears continued to dominate the domestic equities market in the day’s trading as the benchmark index dipped by 0.22% to 26,390.08 points. Consequently, the Month-to-Date and Year-to-Date return worsened to -4.49% and -16.04%.

Also, the total volume of trades decreased by 20.84% to 245.85 billion, valued at NGN1.36 trillion and exchanged in 2,514 deals. FIDELITY was the most traded stock by volume at 25.42 million units, while GUARANTY was the most traded by value at NGN357.80 million.

Losses were evident across all sectors, with the exception of the Oil & Gas sector which closed flat. The Insurance (-1.44%), Banking (-0.45%), Industrial Goods (-0.28%) and Consumer goods (-0.01%) indices all declined.  

Market sentiment, as measured by market breadth, was negative (0.64x) as 9 tickers recorded gains relative to 14 losers. MAYBAKER (+9.50%) and CORNERST (+9.38%) recorded the largest gains, while NEM (-9.57%) and WAPIC (-8.57%) posted the largest declines.

Currency

The naira traded flat against the US dollar at NGN360.00/USD in the parallel market, while it appreciated by 0.08% to NGN362.48/USD at the I&E FX window.

Money market & fixed income

The overnight lending rate widened by 193bps to 7.79%, following the CBN’s liquidity mop-up via an OMO auction held during the day. At today’s auction, the CBN sold instruments worth NGN270.34billion – 185DTM (NGN2.65 billion) and 353DTM (NGN267.69 billion) bills at respective stop rates of 11.79% (same as the previous auction) and 13.35% (same as the previous auction).

Activities in the Treasury bills market were bearish as the average yield increased by 18bps to 12.61%. Yields expanded across the short (+16bps), mid (+20bps) and long (+17bps) segments of the curve, following investors’ sell-offs of the 17DTM (+57bps), 164DTM (+97 bps) and 297DTM (+70bps) instruments.

Trading in the Treasury bonds market was mixed, albeit with a bullish tilt, as the average yield declined by 1bp to 14.10%. Yields contracted across the short (-1bps) and long (-6bps) segments of the curve, following investors’ buying interest in the JUL-2021 (-15bps) and MAR-2036 (-12bps) bonds. Conversely, the average yield expanded at the mid (+3bps) segment of the curve following investor sell-offs of the MAR-2027 (+10bps) bond.

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