September 10, 2020/Cordros Report

EQUITIES

The equities market ended the day higher, as stocks snapped a three-day selloff on bargain buying in ZENITHBANK (+3.4%), GUARANTY (+1.9%) and MTNN (+0.4%). The benchmark index inched higher by 0.4% to 25,520.97 points. Consequently, the Month-to-Date gain increased to 0.8% while Year-to-Date loss moderated to -4.9%.
 
The total volume traded declined by 12.3% to 236.48 million units, valued at NGN1.65 billion and exchanged in 3,251 deals. ZENITHBANK was the most traded stock by volume and value at 33.16 million units and NGN547.00 million, respectively.
 
Sectoral performance was mixed, as the Banking (+2.3%) and Consumer Goods (+0.1%) indices gained while the Insurance (-1.7%) and Oil & Gas (-1.3%) indices closed lower. The Industrial Goods index was flat.
 
Market sentiment, as measured by the market breadth, was positive (1.8x), as 22 tickers gained relative to 12 losers. ETERNA (+9.7%) and CILEASING (+8.5%) topped the gainers’ list while ABCTRANS (-7.7%) and CORNERST (-7.6%) recorded the largest losses of the day.
 
CURRENCY

The naira was flat at the I&E window at NGN386.17/USD, while it weakened by 2.2% to NGN455.00 in the parallel market.

MONEY MARKET & FIXED INCOME

The overnight lending rate contracted by 18bps to 2.2%, following inflows from OMO maturities (NGN265.00 billion) and FX auction refunds.
 
Trading in the NTB secondary market was bullish, as market participants continued to cover for lost bids at the PMA today. Thus, average yield contracted by 8bps to 1.8%. Across the curve, yield contracted at the long (-22bps) end due to demand for the 350DTM (-33bps) instrument, while they were flat at the short and mid segments. Similarly, average yield contracted by 5bps to 2.5% at the OMO secondary market.
 
Elsewhere, the Treasury bond secondary market remained bullish, as average yield contracted by 12bps to 7.6%. Across the curve, yield contracted at the short (-43bps) end, following buying interest in the APR-2023 (-71bps) bond, while they expanded at the long (+12bps) end, due to sell-offs of the JUL-2034 (+12bps) bond; yield was flat at the mid segment.

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