Bills and Equity Market Update   

08 March 2019

Market bounces back amid mild buy interest 

In view of a N229 billion OMO repayment, the CBN conducted an auction, selling N294 billion (N400 billion offered) across the 91DTM and 175DTM bills, at stop rates of 11.90% and 13.45% respectively (effective yields: 12.26% and 14.38%). Meanwhile, the Interbank Call rate declined 33bps to 8.50%. 

In the T-bills space, sentiment turned bullish as average yields declined 29bps with buy-side activity prevalent across the space. Most notably, yields on the 273DTM and 322DTM bills declined 75bps and 103bps respectively to settle at 14.40% and 14.43% respectively. Simultaneously, activity in the bond space was mildly positive, with benchmark yields declining 4bps on average as a result of some buy-sentiment observed at the mid-end of the curve, whilst activity was muted overall. Specifically, yields on the 16.39% FGN JAN 2022 and 13.53% FGN MAR 2025 bonds declined 38bps and 23bps respectively to close at 14.22% and 14.27%. 

With system liquidity currently healthy at N197 billion, analysts foresee a continuation of buy-side activity in the T-bills space in today’s session. Analysts also expect the bond space to trade sideways at week close due to mild investor interest. 

Sell-off persists despite earnings releases 

The NSE ASI once again closed in the red after negative performances in all sectors dragged the market to a 22bps loss. Despite earnings releases, market activity remained below average at N2.7 billion. 

The Oil & Gas sector was the biggest loser, shedding 97bps on the back of losses in MOBIL (-556bps) and OANDO (-175bps). Meanwhile, the Industrial Goods (-39bps), Consumer Goods (-17bps) and Banking (- 13bps) sectors all shed points, driven by losses in DANGCEM (-76bps), FLOURMILL (-476bps) and GUARANTY (-79bps). 

Market breadth remained negative with 11 advances and 25 declines. 

Market Outlook 

Given the prevalent investor apathy in the market despite earnings releases, analysts foresee a negative close to trading today. However, analysts do not rule out the possibility of bargain hunting on select stocks. 

Stock Watch: GUARANTY recently released its FY’18 results, reporting topline of N434 billion and bottom-line of N184 billion (FY’17: N419 billion and N167 billion respectively). The stock declined 79bps in yesterday’s session, closing at N37.65. 

Corporate Disclosures 

The Board of Directors of Julius Berger Nigeria has announced the meeting of the board and statutory audit committee will meet on 19 March 2019 to approve the financial statements for the year. The company also announced a closed from 7 March to 22 March 2019. 

The Board of Director of Stanbic IBTC Plc has announced a final dividend of N1.50 per 50 kobo ordinary share, subject to appropriate withholding tax and approval at the Annual General Meeting will be paid to shareholders whose names appear in the Register of Members as at the close of business on the 20 March 2019. 

The Board of Directors of C&I Leasing Plc has announced the meeting of the board will be held on 14 March 2019 to consider the company’s audited accounts for the year. The company also declared a closed period on its stock from 6 March until its financial statements are released. 

The Board of Directors of Chemical and Allied Products Plc has informed the Nigerian Stock Exchange that its meeting will be held on 20 March 2019 to consider its audited financial statement for the period ended 31 December 2018. The company also announced a closed period from 7 March to 31 March 2019.

Reporting for EasyKobo on Friday , 08 March 2019 in Lagos, Nigeria

Source: Vetiva Capital Management Limited

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