| Proceedings in the Nigerian equities market sustained its bullish run from last week, as the ASI closed in the positive zone for the seventh straight session. Specifically, the benchmark index notched slightly higher by 0.81% to close at 31,529.92 points, on account of buying sentiments across major counters. Against that backdrop, the Month-to-Date and Year-to-Date returns increased to 4.01% and 1.12% respectively. Sifting through the sectoral breakdown, we note that all sector indices closed positive, with the Banking (+1.90%) index topping the charts, followed closely by the Insurance (+1.20%), Oil and Gas (+0.58%), Consumer Goods (+0.42%) and Industrial Goods (+0.31) indices respectively. Notable stocks include ZENITHBANK (+2.25%), AIICO (+6.94%), OANDO (+10.00%), DANGFLOUR (+9.49%) and BETAGLAS (+9.55%). Market breadth was positive, with 40 gainers and 10 losers, led by LASACO (+10.00%) and CILEASING (-9.96%) respectively. Meanwhile, volume and value traded moderated sharply by 23.8% and 53.7% to 551.59 million units and NGN5.65 billion respectively, and consummated in 5,229 deals. Our outlook for equities in the near-to-medium term remain conservative, and we guide investors to trade cautiously, amidst absence of a near term catalyst and political jitters ahead of the upcoming 2019 elections. However, macroeconomic fundamentals remain stable and supportive of recovery in the long term. CURRENCY The USD/NGN depreciated by 0.06% to NGN361.95 at the I&E FX window, but remained flat at NGN361 in the parallel market. Total turnover in the IEW increased by 4.5% to USD328.47 million, with trades consummated within the NGN315.00-363.00/USD band. FIXED INCOME AND MONEY MARKET The overnight lending rate surged by 2,808 bps to 47.50%, as banks funded for the wholesale FX auction. In addition, the CBN continued its OMO interventions, mopping up NGN38.36 billion – NGN2.41 billion of the 94DTM, NGN1.08 billion of the 178DTM, and NGN34.87 of the 360DTM bills – from the system at respective stop rates of 11.90%, 13.50% and 15.00% respectively. Activities in the Treasury bills market were bearish as average yield expanded by 4 bps to close at 14.65%. Sell pressure was spread across the short (+10 bps), mid (+3 bps) and long (+1 bps) segments. Notable bills include the 10DTM (+136 bps), 171DTM (+25 bps) and 283DTM (+58 bps) respectively. Similarly, proceedings in the bond market were also bearish, as average yield expanded by 3 bps to 14.65%. Yield expanded at the short (+5 bps), mid (+1 bps) and long (+4 bps) segments, driven by selloffs of the JUN-2019 (+21 bps), JUL-2030 (+8 bps) and MAR-2036 (+13 bps) bonds, respectively |
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