T-bills market boosted by short-term buying 

28 August 2018 : The interbank call rate advanced 608bps to 12.83%. Despite this, buying was observed in the T-Bills space, with yields declining 10bps on average and demand focused on shorter dated maturities. Of note, yields on the 17DTM and 24DTM bills declined 58bps and 80bps to 11.63% and 9.48% respectively. Meanwhile, the bonds space was bearish, as yields on benchmark bonds rose 6bps on average, with selling focused on mid-dated securities. Yields advanced on the 12.50% FGN JAN 2026 and 13.98% FGN FEB 2028 bonds advanced 16bps and 17bps to settle at 14.96% and 14.95% respectively. 

Analysts expect relatively healthy system liquidity to support demand on T-bills, but foresee another tepid session in the bond space amid weak investor appetite for longterm instruments. 

ASI experiences see-saw movement as Industrials falter 

The Nigerian bourse got off to a negative start on Monday with the ASI shedding 32bps. As was the case last week, movement of the ASI was majorly dictated by the Industrial Goods sector, noting that all other key sectors posted green closes on the day. 

The Industrial Goods sector (-40bps) was the only major sector in negative territory at week open as a reversal in DANGCEM (-213bps) outweighed gains in WAPCO (+286bps). Meanwhile, the Banking sector (+96bps) was the biggest gainer, on the back of bargain hunting in UBA (+188bps), GUARANTY (+133bps) and ACCESS (+56bps). The Consumer Goods (+24bps) and Oil and Gas (+48bps) sectors also recorded positive closes thanks to gains in FLOURMILL (+977bps), DANGSUGAR (+204bps) and TOTAL (+191bps). 

Market breadth remained negative with 27 advances and 13 declines. 

Market Outlook 

Whilst the see-saw movement in the NSE ASI over the past few sessions has been primarily driven by DANGCEM, broader market sentiment appears less downbeat at week open and as such analysts foresee a mixed trading session today with ASI possibly securing a mildly positive close. 

Stock Watch: UBA has recorded a 16% decline so far this month, with the stock falling to a year-low ofN8.00 on Friday its lowest price this year, the stock recorded a 188bps gain in yesterday’s session amidst bargain hunting and the bank is due to release its H1’18 before the end of the month. 

Corporate Disclosures

The Board of Directors of Lafarge Africa Plc has notified shareholders of an extra-ordinary general meeting, to hold at the MUSON Centre on Tuesday 25 September 2018. 

The Board of Direcors of GlaxoSmithKline Consumer Nigeria Plc has notified the Nigerian Stock Exchange of the appointment of Ms. Debra Mallowah and Mr. Basel Nizameddin as non-executive directors on the board of the company. 

Reporting for EasyKobo on Tuesday ,28 August 2018 in Lagos, Nigeria

Source: Vetiva Capital Management Limited