Equity Market sustains losing streak, sheds N15 billion

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The Nigerian stock market (equities category) has sustained its losing streak for three straight days, posting a N15 billion drop in the Nigerian Stock Exchange market capitalisation.

A total of 196.469 million shares valued at N2.611bn were traded in 3,317 deals.

The NSE market capitalisation, at the close of trading on Thursday, dropped to N9.015tn from N9.030tn, while the NSE All-Share Index closed at 26,201.60 basis points from 26,245.34 basis points.

Amid persistent mixed trading across key sectors, the equity market traded lower as the NSE ASI shed 0.17 per cent. Meanwhile, global markets traded mixed ahead of European Central Bank’s decision on monetary policy rate (base interest rate held at zero per cent).

The banking sector and the oil/gas sectors swung into positive territory following gains in Ecobank Transnational Incorporated Plc, United Bank for Africa Plc, Total Nigeria Plc and Mobil Oil Plc, which shares appreciated by 4.23 per cent, 1.57 per cent, 3.34 per cent and 1.34 per cent, respectively.

The industrial goods sector closed 0.29 per cent lower, after closing relatively flat for three consecutive sessions, as five per cent loss in Berger Paints Nigeria Plc and 0.6 per cent loss in Dangote Cement Plc stocks outweighed 4.83 per cent gain in Cutix Plc and 0.6 per cent gain in Cement Company of Northern Nigeria Plc.

The consumer goods sector extended its year-to-date barren run as Champion Breweries Plc and Nigerian Breweries Plc lost 0. 42 per cent each and Nestle Nigeria Plc shed 0.40 per cent.

Market breadth turned positive with 20 advances and 19 declines.

“We expect the overall mixed sentiment (with a bearish bias) to remain the theme of the trading week. Hence, we foresee another tepid session on Friday (today),” analysts at Vetiva Capital Management said.

At Wednesday’s bond auction, the Debt Management Office sold N34.95bn, N74.90bn and N105.10bn, respectively on the five-year, 10-year and 20-year bond at respective yields of 16.8990 per cent, 16.9945 per cent and 16.9920 per cent.

Amid the liquidity mop up, the interbank call rate advanced by 250 basis points to 10 per cent. Meanwhile, at the foreign exchange interbank market, the naira spot rate depreciated by N0.25 while the one-year forward rate appreciated by N29 to close at N305.50 and N349, respectively.

At Wednesday’s Primary Market Auction, the CBN auctioned a total of N269bn across the 91 day-to-maturity, 182DTM and 364DTM bills at respective stop rates of 13.8999 per cent, 17.25 per cent and 18.6499 per cent (effective yields: 14.40 per cent, 18.87 per cent, 22.91 per cent).

Despite the mop-up, the Treasury bills market turned bullish as yields declined by 13 basis points on the average buoyed by healthy demand across board. Particularly, yields on the 133DTM, 196DTM and the 329DTM bills moderated to 16.95 per cent, 19.21 per cent and 20.94 per cent, respectively.

The bonds market, however, traded bearish as yields adjusted to auction levels. Notably, yields on the auction bonds – 14.50 per cent FGN July 2021, 12.50 per cent FGN January 2026 and 12.40 per cent FGN March 2036 rose by 30 basis points, 24 basis points and 23 basis points, respectively to settle at 16.79 per cent, 16.89 per cent and 16.87 per cent.

“Given the liquidity mop up, we expect mixed trading to persist at week close albeit with a bearish tilt,” the analysts noted.

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