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Markets Wrap: Equities begin the week in red as investors dump stocks, Naira trades at NGN380.00/USD in the parallel market

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MON, MARCH 16 2020-theG&BJournal- The Nigerian equities market began the week on a bearish note, as the All-Share Index declined by 0.1% to 22,705.19, driven by investors’ sell-off of UBA, FBNH, and WAPCO stocks. Thus, the Month-to-Date and Year-to-Date losses worsened to -13.4% and -15.4%, respectively.

The total volume of trades decreased by 24.8% to 551.48 million units, valued at NGN5.76 billion and exchanged in 6,981 deals. GUARANTY was the most traded stock by volume and value at 137.23 million units and NGN2.61 billion, respectively.

On sector performance, all sector indices declined save for Insurance (+1.3%) and Banking (+0.6%), as the Industrial Goods (-0.5%), Consumer Goods (-0.2%) and Oil & Gas (-0.0%) declined.

Market sentiment, as measured by market breadth, was positive (1.4x), as 18 tickers gained, relative to 13 losers. UCAP (+10.0%) and UPL (+10.0%) were the top gainers, while TRANSCORP (-10.0%) and JAIZBANK (-10.0%) recorded the largest declines of the day.

CURRENCY

The naira was flat at NGN380.00/USD in the parallel market but strengthened by 0.2% to NGN367.78/USD at the I&E FX window.

MONEY MARKET & FIXED INCOME

The overnight lending rate expanded by 8.02ppts to 18.1%, as system liquidity – estimated at NGN96.54 billion – squeezed as bank provisioned for CBN’s weekly Wholesale, Invisibles and SMEs FX auctions.

Trading in the NTB secondary market was bullish, as average yield pared by 5bps to 3.8%. Yields contracted at the mid (-11bps) and long (-3bps) segments following buying interests in the 164DTM (-20bps) and 199DTM (-11bps) instruments, respectively; the short end was flat. However, average yield expanded in the OMO secondary market by 20bps to 17.0%.

The Treasury bond secondary market was bearish, as average yield expanded by 24bps to 11.8%. Across the curve, yields expanded at the short (+2bps), mid (+62bps) and long (+3bps) segment, following selloffs of the APR-2023 (+139bps), JUL-2030 (+244bps) and APR-2049 (+10bps) bonds, respectively.-With Cordros Research

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