Bills and Equity Market Update   

T-bills market turns quiet as investors await the PMAs 

12 March 2019 : The CBN held-off from offering any bills in an OMO auction yesterday. Meanwhile, the Interbank Call rate advanced 166bps to 10.83%. 

Despite the CBN refraining from conducting an OMO auction, the T-bills market opened on a quiet note with mixed trading sentiment observed across the space. Most notably, whilst the yield on the 87DTM bill declined 23bps to settle at 12.19bps, the yield on the 185DTM bills advanced 15bps to settle at 14.30%. Meanwhile, activity in the bond market remained negative with continued sell-offs prevalent on the mid-dated maturities leading to benchmark yields advancing 12bps on average. Specifically, yields on the 13.53% FGN MAR 2025 and 16.2884% FGN MAR 2027 bonds declined 29bps and 52bps respectively to close at 14.58% and 14.54%. 

Analysts expect continued tepid trading in the T-bills market as investors await the Primary Market Auction on Wednesday. Meanwhile, analysts foresee mild sell-offs continuing in the bond market as bearish sentiment persists. 

Banking stocks drive negative ASI performance 

The market continued on a negative path, moderating 90bps at week start, led by heavy declines in the banking sector. Notably, all sectors except Oil & Gas closed in the red. 

Dragging the ASI down, the Banking sector posted declines on the back of losses in ETI (-214bps). Similarly, the Consumer Goods (-68bps) and Industrial Goods (-44bps) sectors shed points after a loss in NESTLE (-199bps) outweighed a gain in CADBURY (+10.00%), and WAPCO moderated 347bps. Finally, the Oil & Gas sector inched 1bp up, thanks to a 6bps gain in MOBIL. 

Market breadth remained negative with 13 advances and 20 declines. 

Market Outlook 

Following successive red closes in the market, analysts foresee bearish sentiment driving another negative close today. That said, analysts highlight the possibility of bargain hunting on select stocks. 

Stock Watch: WAPCO released an update on its recently concluded Right Issue announcing an acceptance of N89.2 billion worth of shares (100% subscribed). The stock lost 3.47% yesterday to settle at N12.50, trading at a year-to-date return of 0.40% (Industrial Goods: 0.90%). 

Corporate Disclosures

The Board of Directors of 11 Plc have approved the audited accounts of the company for year ended December 31 2018 and recommend a dividend subject to approval by the shareholders at the next Annual General Meeting. Consequently, the results are scheduled to be release on 22 March 2019. 

Reporting for EasyKobo on Tuesday , 12 March 2019 in Lagos, Nigeria

Source: Vetiva Capital Management Limited

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