Bills and Equity- what happened yesterday?   

10 August 2018


Liquidity mop-up spurs increased market activity 

The Interbank Call rate advanced 25bps to 8.00% amidst an OMO auction at which the CBN offered N450 billion and sold N377 billion across the 91DTM and 203DTM bills at respective stop rates of 11.05% and 12.15% (effective yields: 11.36% and 13.03%). 

Yield movement in the T-bills market reversed in yesterday’s session as expected, with yields rising 12bps on average. Specifically, yields on the 35DTM (+76bps to 11.47%) and 343DTM (+25bps to 12.63%) bills advanced. Meanwhile, sentiment in the bond space was mixed yet again, even as yields on benchmark bonds added 3bps on average. Notably, yields on the 16.00% FGN JUN 2019 and 14.50% FGN JUL 2021 bonds rose 18bps and 20bps to settle at 12.79% and 13.87% resepectively. 

With system liquidity tightened post the liquidity mop-up, analysts expect the T-bills space to close the week on a negative note. However, analysts foresee another mixed to flat session on Bonds today in the absence of any significant market drivers. 

Declines persist as market records fifth-straight red close 

The bourse remained in negative territory for the fifth consecutive session as sustained subdued trading drove the market 19bps down. Performances across the key sectors were mixed, but negative closes in Banking and Oil and Gas ultimately dragged the market. 

The Oil & Gas sector was yet again the biggest loser, falling 68bps as a slide in MOBIL (-556bps) countered gains in ETERNA (+167bps). The Banking sector (-12bps) also closed in the red, following losses in ZENITHBANK (-63bps), FIDELITY (-370bps) and UBA (-53bps). Meanwhile, the Consumer Goods (+9bps) sector closed marginally higher thanks to a 164bps gain in INTBREW which countered PZ’s 140bps loss. Finally, the Industrial Goods sector closed flat on the day. 

Market breadth turned negative with 13 advances and 21 declines. 

Market Outlook 

With negative sentiment prevalent in the market – evidenced by the negative market breadth and weak value traded, analysts foresee a bearish close to the week, despite the possibility of bargain hunting on beaten down stocks. 

Stock Watch: NIGERINS has gained 50% in the last 7 session to trade at a price of N0.39 per share. The stock has declined 22% ytd, down from its year-high value of N0.50. 

Corporate Disclosure

  • The Board of Directors of Smart Products Nigeria Plc has notified the general public that it will be holding its 52nd annual general meeting on Thursday 30 August 2018 at the company’s board room to discuss the company’s financial statements for the period ended 30 June 2018. 
  • The Board of Directors of Cornerstone Insurance Plc has notified shareholders the filing of its audited financial statements for the year ended 31 December 2017 and the unaudited financial statements for the first quarter ended 31 March 2018 and the second quarter ended 30 June 2018. 
  • The Interim Management Committee of Fortis Microfinance Bank Plc. has informed the general public that it is yet to file its second quarter 2018 unaudited accounts due to the fact that the company’s audited financial statements for the year ended 31 December 2016 is currently being revalidated along wit the audit of the accounts for the year ending 31 December 2017. 
  • The Board of Directors of Guaranty Trust Plc has announced the issuance of an interim dividend in the sum of N0.30 per ordinary share of 50 kobo, subject to withholding tax deduction and approval. 
  • The Board of Directors of Notore Chemical Industries Plc has released its nine month 2018 results on Thursday 9 August 2018. 
  • The Board of Directors of Cement Company of Northern Nigeria Plc has notified the Nigerian Stock Exchange that an extra-ordinary board meeting was held on 6 August 2018 where the board uinanimously approved the appointment of Engr. Yusuf Haliru Binji as a new Managing Director/Chief Executive Officer following the exit of Alhaji Ibrahim Aminu. 

Reporting for EasyKobo on Friday ,10 August 2018 in Lagos, Nigeria

Source: Vetiva Capital Management Limited

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