Bills and Equity- what happened yesterday?   

Market opens to positive trading in the new week 

03 October 2018 : Driven by healthy system liquidity (Currently estimated at c.N552 billion), the Interbank call rate declined 117bps to 4.83%. 

• Meanwhile, trading was positive across the T-bills market yesterday, with yields declining 26bps on average. Notably, the 30DTM and 135DTM bills declined 89bps and 82bps to settle at 12.46% and 13.03% respectively. Similarly, demand was healthy in the bond market, with benchmark yields declining 6bps on average. Notably, yields on the 15.54% FGN FEB 2020 bond and 12.50% JAN 2026 bond moderated 32bps and 26bps to close at 13.76% and 14.72% respectively. 

• Analysts expect positive trading to continue across both the T-bills and bond market, driven by the buoyant system liquidity. 

Fourth quarter begins with negative close 

• The Nigerian equity market began the new quarter on a backfoot as the NSE ASI closed 17bps lower following a red close in the Consumer Goods sector and a last minute pullback in STANBIC (-761bps). 

• The sole loser on the was the Consumer Goods sector which shed 13bps on the back of losses in GUINNESS (-244bps), DANGSUGAR (- 211bps), and FLOURMILL (-125bps). Meanwhile, the Industrial Goods (+62bps) & Oil and Gas (+36bps) sectors were the top gainers thanks to WAPCO (+360bps) and FO (+673bps) respectively. Finally, the Banking sector closed 6bps up as gains in FIDELITYBK (+120bps) gave the sector a slight boost. 

Market breadth remained negative with 22 advances and 23 declines. 

Market Outlook 

With market sentiment still tepid, and noting the lack of investor enthusiasm, analysts foresee another mildly negative close at mid-week. 

Stock Watch: PZ released its Q1’18/19 results on Friday. The company reported a 14% y/y decline in revenue, and a loss after tax of N205 million. Vetiva currently has a 12-Month Target Price of N20.15 on the stock, above the current market price of N12.55. 

Corporate Disclosures

The Board of Directors of Custodian Investment Plc has informed the Nigerian Stock Exchange of the holding of a meeting on 25 October 2018 to discuss the company’s management accounts for 9M’18. 

The Board of Directors of Julius Berger Nigeria Plc has notified the Nigerian Stock Exchange of the exit of Engr Wolfgang Goetsch as the Managing Director of the company and the entry of Dr. Lars Richter as his replacement. Also a new Directorate, Corporate Development will be established to be headed by Mr Tobias Meletchus. 

Reporting for EasyKobo on Wednesday , 03 October 2018 in Lagos, Nigeria

Source: Vetiva Capital Management Limited

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