Outlook 2021: A Gaze into Market Performance - Equities Market


Tuesday, February 23, 2021   /04:00 AM / By Proshare Research/ Header Image Credit: EcoGraphics


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Ranking the Global Markets in 2020

The year 2020 brought a rapid and unpredictable change to global economies and stock markets with an unprecedented health crisis that disrupted markets throughout the year. As the COVID-19 pandemic escalated, the year was characterized by a fall in oil prices and the Russia-Saudi Arabia oil tiff.


Analysts note that the year 2020's 'Coronavirus Crash' was a major market tumble that began on the 20th of February 2020. With several businesses remaining operationally comatose over the period, labour became the whipping boy as companies laid-off workers like nine pins. Consequently, there was a sharp reduction in consumption and output, resulting in corporate revenues tanking. During the crash stock prices and stock markets went into freefall; Central Banks globally started quantitative easing ('QE') and governments primed fiscal pumps as they tried to stave off recessions.


The hospitality, oil and gas, tourism, transport, construction/real estate, and retail sectors were hardest hit, while some sectors were mildly affected by stock price declines. Sectors that proved to be countercyclical were- technology and software, essential goods, and consumer goods. Technology stocks benefitted from the positive outlook of increased earnings as consumers worked from home, spent their money online as e-commerce platforms saw revenue surge. The decline in government bond yields supported technology stocks as investors considered them as hidden value opportunities or growth stocks expected to increase their earnings over the medium to long-term.


At the end of Q2 2020, economies globally started opening up after the Q1 lockdown. Rising fiscal stimulus, lower interest rates, and broader Central Bank interventions added liquidity which propped equity markets up. The global fiscal interventions boosted confidence and supported equity markets in the US, Europe, and Asia.


Emerging markets such as Thailand, Chile, Brazil, and the Philippines have not left out the anti-recession dogfight. These countries too saw their governments go deeper into debt to support economic growth. The impact of COVID-19 on global economic growth differed across markets, but weaknesses of emerging or frontier economies were exposed as fiscal deficit, foreign capital dependence, and contraction of GDP weighed heavily against weaker economies. As countries navigate new paths to recovery, emerging markets seem resolute in reaching points of economic revival.


Top Five Performing Stock Markets in The World


America (NASDAQ Composite Index and The Breakout of Tech Stocks In 2020): +42.74%

The NASDAQ is the second-largest stock and securities exchange in the world, behind only the New York Stock Exchange (NYSE). The NASDAQ attracts some of the largest blue-chip companies globally with representatives from high-tech software, hardware computer, and internet service companies such as Apple, Amazon, Microsoft, Intel, Cisco Systems, and Netflix present on the Exchange, although other industries have representatives on NASDAQ as well. The NASDAQ Index tends to be more volatile and growth-focused than other indexes because it has a higher composition of growth-oriented companies.


The tech-heavy NASDAQ topped Proshare's list of gainers in 2020. The industry's biggest players: Amazon, Apple, Facebook, Alphabet, and Microsoft were somewhat well placed to rise to the challenges of the coronavirus pandemic as the virus accelerated digitalization around the world. For example, Zoom Technologies Inc, the go-to video conferencing platform during the pandemic, recorded an increase in its stock price by +464% from US$68.04 on December 31st, 2019 to US$383.88 as of December 23rd, 2020.


The overall NASDAQ Index closed the year up by +42.74% to 12,807.92 points as of 22 December 2020 from 8,972.6 points recorded on 31 December 2019.


America (S&P 500)

America's S&P 500 index closed the year in the green with a growth of +14.13% from 3,230.78 points as of 31 December 2019 to 3,687.26 points on 22 December 2020. the biggest movers for the S&P were stocks in the Medical Specialties, Information Technology Services, Semiconductors, Data Processing Industries such as Nvidia Corporation, Paypal Holdings.


The recent signing of a coronavirus aid bill and rollout of vaccines have increased expectations that the economy will quickly rebound from the pandemic, fuelling gains in the market. 


South Korea (KOSPI Composite Index): +26.79%

The KOSPI index stood out in 2020 compared to other Exchanges across the Asia Pacific. South Korea's KOSPI index recorded the highest gain Y-o-Y ahead of the Nikkei 225, Shanghai Composite Index, Taiwan Weighted Stock Index, and Bursa Malaysia (KLSE). The index gained +26.79% to close at 2,759.82 points on 22 December 2020 from 2,176.67 points recorded on 31 December 2019. 


South Korea's GDP rebounded by +2.1% in Q3 2020 after contracting by -3.2% in Q2 2020 riding on its weakest growth amid the pandemic. The country's exports, which accounts for half of the economy rebounded on the back of an increase in the export of semiconductors and chipmakers (the second largest in the world). Also, the South Korean government's push for more development in Artificial Intelligence (AI) increased the demand for these products.


This move came at the right time as countries sought the need to ramp up digitization and tech stocks around the world recorded a surge in share prices. The KOSPI Index increased in valuations based on a potential increase in earnings in 2021 therefore, more healthcare stocks and battery stocks became large caps.


Taiwan (The Taiwan Weighted Index): +18.55%

The Taiwan Weighted Index grew by +18.55% from 11,997.14 points it closed at on 31 December 2019 to 14,223.09 points. The global forecast for the Asian markets has been cloudy, with coronavirus concerns offset by vaccine optimism. This year, with the rise in technology stock prices, the Taiwan Exchange has been a major beneficiary as investors sought safety in companies such as semiconductor producers. The Exchange market also gained from a slew of liquidity resulting from QE. However, the Central Bank's stricter mortgage rules left buying interest in the home purchase market in the dumps.


Taiwan Semiconductor Manufacturing Company (TMSC) the most heavily weighted stock on the market with other bellwether tech heavyweights experienced increased investor sentiment as investors looked for where to put their money. TMSC share price rose by +53.96% from 334.50TWD on 30 December 2019 to 515TWD as of 28 December 2020.


China (SSE 180 Index - Shanghai): +14.29%

The Shanghai Stock Exchange grew by +14.29% to 10,254.81 points from 8,972.92 points on 31 December 2019. Despite prevailing uncertainties marked by the COVID-19 outbreak, as well as political, social, and economic concerns in China the markets have seen a string of initial public offerings (IPOs) and an intense rally in share prices of consumer and technology companies. One of the reasons for the performance of the Exchange is the overall resilience of China as it became the first major economy to return to post-coronavirus growth, this shored up confidence in the equities market. Stocks of internet groups, Technology such as Tencent Holdings have surged as consumers pivoted to online lifestyle during the pandemic (E-commerce, Technology, Food Delivery, Health-Tech, Gaming).


China's IPO market has seen increased listings in 2020 despite the economic challenges on the back of global investor demand for growth stocks, liquidity available from government stimulus policies, coupled with the US-China trade tensions, have caused more Chinese companies to seek primary or secondary listings on the Chinese Exchanges.


Shanghai, Shenzhen, and NASDAQ Exchanges led the number of deals in Q3 2020, accounting for 54% of global IPOs. Shanghai dominated global exchanges by proceeds in Q3 2020, accounting for 25% of global IPO proceeds, Technology, health care, and industrials were the most active sectors on these four exchanges. YTD 2020's largest listings included the listing of Semiconductor Manufacturing International Corp. (US$7.5b) on the Shanghai STAR Market, JD.com Inc. (US$4.5b) on the Hong Kong Stock Exchange. IPO activity in Asia-Pacific is on track to well-exceed 2019 volumes and proceeds on the back of some mega transactions completed and in progress" according to a report by Ernst & Young on Global IPO Trends in Q3 2020.


Table 21: Best Performing Markets in 2020

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Top Five Lowest Stock Markets Performance in The World

Austria (ATX): -15.04%

The ATX topped the list of laggards in 2020. The Austrian Traded Index is a capitalization-weighted index of the most heavily traded stocks on the Vienna Stock Exchange, as of 2019 the exchange comprised of 20 stocks. The index recorded the highest losses with a -15.04% decline from 3,186.94 points on 31 December 2019 to 2,707.52 points as of 22 December 2020. The decline of the ATX index was affected by the cyclical component of heavy-weight stocks in the financial, oil, and steel sectors listed and are currently causing a downturn, whereas in an economic recovery the stocks have a high potential for a rebound.


United Kingdom (FTSE 100): -14.44%

Britain was in the eye of the coronavirus storm as restrictions on traffic between the UK and other countries raised the pressure on supply chains, Brexit uncertainty, coupled with fresh lockdowns to prevent the new strain of coronavirus sweeping across southern England from spreading to the continent weighed on the capital market. The FTSE 100 ('Footsie') suffered its worst year since 2008. It declined by -14.44% from 7,542.44 points on 31 December 2019 to 22 December 2020. During the market crash in February where global markets were at an all-time low, heavy fall were followed by a massive selloff on the bourse in March as investors braced for a recession. The FTSE 100 lagged and has since been playing catch-up. The British market has a high concentration of cyclical stocks in the Oil and Gas, Industrial, Financial Services, and Construction sectors which stalled the recovery. During the year, there was still a great deal of uncertainty about the future path of the market, with fresh lockdowns and disruption posing a major threat but a reversal flickers on the horizon.


While the Footsie is still down 14% Year-to-Date, it has seen a steady rise in December and received a boost after a trade deal with the EU was reached and another vaccine was approved.


Singapore (Straits Times Index): -12.67% 

The Straits Time Index declined by -12.67% to 2,827.81 points on 22 December 2020 from 3,238.07 as of 31 December 2019. It is a capitalization-weighted stock index that is regarded as the benchmark Index for the Singapore stock market. It tracks the performance of the top 30 companies listed on the Singapore Exchange. The major contributing factor to the decline is the component of the stocks listed; the stocks are pro-cyclical in composition representing real estate, financial Services, and manufacturing sectors which took major hits during the pandemic.


Belgium (Bel 20): -8.80%

The BEL 20 is a free-float market capitalization-weighted index that reflects the performance of the 20 largest and most actively traded shares listed on Euronext Brussels and is the most widely used indicator of the Belgian stock market. The index had its share of downturns because of the pandemic which slowed down economic activities. The index fell to a low of 2,528.77 points in March 2020 from 3,967.18 points in January 2020, then recovered in June to 3,540 points. Although the index is lagging in terms of recovery compared with other indices, the Bel 20 proves resilient as it struggles to rebound to pre-pandemic levels. Year-to-Date, the index declined by -8.80%. 


France (CAC 40): -8.55%

The CAC 40 is a free-float market capitalization-weighted index that reflects the performance of the 40 largest and most actively traded shares listed on Euronext Paris and is the most widely used indicator of the Paris stock market. the Paris bourse ends the year in red with a -8.55% decline in 2020 to 5,466.86 points as of 22 December 2020 from 5,978.06 points on 31 December 2019.


French stocks tumbled this year as France dealt with its share of coronavirus concerns with over 2 million cases and 190,00 deaths in the country. Lockdown measures, uncertainties about the Brexit negotiations and economic downturn weighed in on the market.


Stock markets in Europe have been the laggards in 2020 but saw renewed optimism after European Union (EU) officials and British lawmakers approved a separation deal that will govern trade and other relations from 2021 in addition to the new roll-out of vaccines helping boost sentiment and spur the markets to recovery in the near term. the outlook for the French index in the days ahead is optimistic.

Table 22: Worst Performing Markets in 2020

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Outlook for Global Markets

As the global markets recover from the initial shock of COVID-19, which created extreme market volatility in Q1 2020, digital transformation became the defining market trend of 2020 as businesses, consumers and families learned how to live in an online world. Major subjects of conversation were on how technology will influence future production and consumption as technology stocks were the first to record a boost in earnings as consumers worked from home, spent online, and made technology purchases.


The global economic backdrop remains uncertain with the second wave of COVID-19 infections upon us and another round of lockdown measures in some countries. While the unprecedented financial and monetary stimulus packages announced by governments worldwide have so far provided support, there is several unknown variables that continue to weigh on market sentiment. There is mild optimism that global equity markets will begin to edge up as supply chains become restored, manufacturers increase sales volumes and workers get back to their jobs on the back of a COVID-19 vaccine that would likely cover most of Europe and America by Q2 2021 and other continents between Q3 and Q4 2021.


Investors will most likely look for stocks with the potential to outperform in the next few years. Investors will look out for megatrends such as: digital transformation, healthcare innovation, and sustainability.

Nigeria - All Share Index


The year started with the launch of the growth board as part of the NSE's strategies to encourage companies with high growth potential on the exchange as we reported previously in the article "Growth Board To Roar As NSE's ASeM Slowly Disappears". The board was designed to encourage the listing of companies, which are active in their respective sectors and have exhibited growth potential with good corporate governance standard characterized by less stringent listing requirements, that provide greater accessibility for growth-oriented companies, raise long-term capital, making it easier to attract capital flows, reduce pre and post-listing requirement obligations and promote liquidity. On 30th November 2020, the NSE announced Four Companies to be migrated from the ASeM to the Growth board. They include Chellarams Plc, Living Trust Mortgage Plc, McNichols Plc, and The Initiates Plc.

Also, in the year under review, the twin combination of the outbreak of the novel coronavirus (COVID-19) and volatility in oil prices caused volatility in the Nigeria bourse and global market. The Nigerian Stock Exchange had no choice but to remain resilient even in the face of the pandemic. The NSE, in response to flattening the infection curve, activated the business continuity plan with Remote Trading ​during normal hours and days by providing remote trading access for Dealing Member Firms through FIX Protocol and Virtual Private Network (VPN) platforms.

The impact of the macroeconomic challenges from the pandemic was felt in H1 2020. According to the Nigerian Bureau of Statistics (NBS), Nigeria's gross domestic product (GDP) contracted by -6.1% year-on-year in Q2 2020 and by -3.62% in Q3 2020. Crude oil price volatility continued to put pressure on foreign exchange stability which necessitated several exchange rate adjustments by the Central Bank of Nigeria from N307/$1 in March 2020 to N380/$1 in August 2020, indicating a naira devaluation by 23.8%. Similarly, the headline inflation rate has been on the rise, from 11.22% in June 2019 to 12.13% in January 2020 and 14.89% as of November 2020.

The market capitalization of the Nigerian Stock Exchange which represents the value of all companies listed on the exchange lost N1.86trn (-20.65%) in Q1 2020 to close at N11trn from N12.96trn recorded at the end of Q4 2019. In April 2020, the bourse posted a gain of +8.08% at 23,021.01 points, a significant turnaround from -9.11% and -18.75% recorded in February and March respectively during the severity of the Covid-19 infections. The rebound occurred because of the news of recovery in oil prices at the international market, which was enhanced by improved 2019 corporate actions and quarterly earnings of listed companies.

The Nigerian equities market was notably volatile following the Q1 selloffs on the back of the global concerns regarding the virus. The equities market provided a massive opportunity for bargain hunting with many stocks trading at huge discounts and offering higher dividend yields than fixed income. In Q2 2020, the NSEASI grew by +14.92% while the market cap closed at N12.80trn. It then advanced by +9.61% with the market cap at N14.03trn to close the year with +50.09% growth in Q4 2020 and market cap at N21.06trn.

It is evident that the monetary and fiscal policy measures helped mitigate the initial shock of the pandemic. The equities market responded positively to macroeconomic policy changes such as the cut in Monetary Policy Rate (MPR) by 100 basis points from 12.5% to 11.5% by the Central Bank of Nigeria in September 2020. In the same vein, the CBN reduced the minimum interest on Savings deposits from 30 percent of the MPR to 10 percent. Furthermore, to increase credit to the real sectors of the economy, the apex bank sustained its deposit to loan ratio of 65 percent. A contribution of high liquidity due to a decline of alternative investment opportunities in other asset classes such as the negative interest rates on fixed income securities, better-than-expected positive Q3 results by listed companies led to the surge in activity level which supported a strong bullish performance in the local bourse from October till December by domestic retail and institutional investors (see Table 23).

Table 23: Factors that Shaped the Equities Market in 2020

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On Thursday, November 12, 2020, at 12:55 p.m, the bullish performance on the bourse triggered a market-wide circuit breaker when the NSE All-Share Index (NSE ASI) rose beyond the set threshold of 5%, leading to a 30-minute trading halt of all stocks. This was the first time that the circuit breaker had kicked in since its introduction in 2016. The Circuit Breaker protocol which was triggered by the increase of the NSE ASI from 33,268.36 to 34,959.39   was aimed at preventing the market from volatile trading activities.

Month-on-Month yields on the bourse steadily grew in September by +5.94%, October (+13.79%), November (+14.78%), and closed the year with +14.92% as of 31 December 2020. Players in the capital market continued to ride the waves of the market rally with investors gaining, therefore, market capitalization rose to N21.06trn while year to date return stood at +50.03%.

Chart 75: NSE ASI Index Yield Jan. 2020 - Dec. 2020

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Source: NSE/Proshare Research


Overview of Domestic and Foreign Portfolio Participation in 2020

There was a decline in foreign participation in the bourse when compared with the previous year while domestic participation increased. As benchmark All Share Index began the surge in July, foreign participation steadily declined while domestic participation began to trend upwards. Year-to-date domestic participation on the bourse grew to 65.28% in 2020 amounting to N1.24trn compared to the performance of N920.70bn in 2019.


On the other hand, foreign participation amounted to N659.28bn, declining to 34.72% in 2020 from 48.85% participation in 2019. Weak foreign participation in the Nigerian market was due to weak macroeconomic fundamentals, fears concerning a possible devaluation, and the outbreak of the COVID-19 virus sent foreign investors on a flight to safety. Going forward, we expect that domestic investors would continue to dominate activities on the domestic bourse as foreign investors remain cautious.


Chart 76: NSE Foreign vs Domestic Participation (Jan. 2020-Nov.2020)

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Resilience in The Face of a Pandemic

A total of 57 stocks closed the year higher, with 14 of them recording growths in their share prices by over 70%. The five best-performing stocks for the year were: Sunu Assurances Plc (EQUITYASUR) with share price growing by +400%. The share prices of Neimeth Plc (NEIMETH), FTN Cocoa (FTNCOCOA), Japaul Gold and Ventures Plc (JAPAULOIL), and Airtel Africa Plc (AIRTELAFRI), recorded gains of +259.68%, +230%, +210%, and +184.98% respectively.

Further analysis showed that the low cap stocks from agriculture, ICT and healthcare sectors dominated the best performance for the year 2020. This situation may not continue in 2021 as investors took advantage of the low stock prices and dividend expectation ahead of the full-year earnings season in Q1 2021, despite weak economic fundamentals.


Table 24: Top 10 Performing stocks in 2020

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Pandemic Crushed Demand 

Consumer sentiment was greatly impacted by the COVID-19 pandemic as fast-moving consumer goods faced significant reduction in consumption as well as disruption in supply chains due to the lockdown of major cities in Nigeria.


Furthermore, 66 stocks closed lower than they opened for the year. The five worst-performing stocks for the year were: Arbico Plc (ARBICO) with share price declining by -70.66%. The share prices of Omatek Ventures Plc (OMATEK), NCR Nigeria (NCR), AXA Mansard Insurance Plc (MANSARD), and Afromedia Plc (AFROMEDIA), declined by -60%, -56.44%, -46.97% and, -41.18% respectively. The consumer goods sector was hit by challenges such as foreign exchange devaluation due to a drop in crude oil prices, lockdown of the economy to halt the spread of COVID-19, ENDSARS protest, border closure etc., all of which affected firm's production cost and reduced the purchasing power of consumers.


Table 25: Top 10 Worst Performing Stocks in 2020 

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Movers and Shakers in 2020

In terms of market capitalization, the tables below illustrate the companies that gained and recorded declines in market cap.


Table 26: Advancers and Decliners for 2020

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Outlook: From Pandemic to Recovery

For capital markets globally and in Nigeria, 2020 was an intense and volatile year.  The Nigerian equities market is gradually recovering from the impact of COVID-19 although there is a high degree of uncertainty on the horizon considering the increasing number of cases recorded daily. Macroeconomic instability continues to fuel investor sentiment on the equities market as it witnessed significant primary market activities within the year, it is also worthy to note that no IPO has been recorded throughout the year. The market at the end of the year broke-out 41,000 basis points, owing to a rally for high cap stocks, which is of interest to many investors, considering the weak economic fundamentals.


The Nigerian capital market is likely to maintain this trend until the end of the full-year earnings reporting season, given that there are limited opportunities for higher returns and yields in other asset classes that can match the dividend yields of some listed companies. The current trading pattern and sentiment in the market offers investors opportunities to position for the short, medium, and long-term for fundamentally sound, and dividend-paying stocks for possible capital appreciation in 2021.


Considering the decline in foreign participation on the bourse to 34.,72% in 2020, and bottlenecks in accessing forex, market performance in H1 2021 will be primarily determined by domestic participation which will be supported by the expected liquidity glut and the low fixed income yield environment. As investors position for full year 2020 dividends in Q1 2021, the market is expected to retain the current buying activity with stocks in the financial services sector to dominate activity levels due to high sensitivity to liquidity in the sector. On the flip side, foreign investors would avoid the market if foreign exchange crisis persist.


Furthermore, the stock market bullish momentum will also be determined by government policies to encourage economic development as sentiment for stocks would be driven by the direction of monetary policy and fiscal policy. Inconsistency in policy decisions could create headwinds for the equities market in 2021. Given the polarity between economic growth and stock market valuations currently, anxiety looms as investors are aware that there may be a bubble in the market especially for stocks in certain sectors that have surged unexpectedly. Any signal of trouble that the current stock market rally will be hard to sustain in the long run may push investors into profit taking resulting in high selloffs leading to a reversal in market trends, as the current rally is not backed by fundamentals.


The year 2020 tested the resilience and adaptability of companies listed on the exchange. Companies sought actions such as capital market-driven initiatives by regulators, government policies that foster growth that will help them rebound to pre-pandemic levels. Companies with strong balance sheets plus stable growth potential can project 2021 earnings to rebound to pre-pandemic levels (see Illustration 46).

Illustration 46: 2021 Outlook for the Nigerian Stock Exchange

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Tony and Dangote Index

This section aims to examine the performance of Proshare's index which consists of the Dangote index and Tony's index in the year 2020. Tony and Dangote have stocks with large market cap which can suggest the overall sentiment of the market. Tony's index consists of AFRIPRUD, TRANSCORP, UBA, and UBCAP while Dangote's index consists of DANGCEM, DANGSUGAR, and NASCON.


The headwinds of the twin shocks (COVID-19 Pandemic and Drop in Oil Prices) have continued to weigh heavily on the fortunes of the companies within both indexes, although both companies have proven resilient in the face of the challenges with rebound their revenues in Q3 2020. The decline of FPIs/FDIs and reduced access to credit due to tightened global liquidity impacted the financial markets with a trickle-down effect on the Dangote and Tony index.


Dangote Index 

The stocks herein are within the manufacturing sector which recorded a second consecutive contraction in growth rate by -1.51% in Q3 2020, and -8.78% in Q2 2020.


The index opened the year on a positive note with a growth of +24.98% in January 2020 following major declines in February, March, and June by -5.94%, -23.92%, and -8.50% respectively. The highest decline in the index during the year was recorded in March. This decline was because of macroeconomic challenges resulting from the pandemic causing supply chain disruptions, lockdown, and restrictions which affected household incomes and led to a reduction in demand for goods and services.


Following the gradual reopening of the economy, the Dangote index closed the year positive with +17.39% as of 22 December 2020. Furthermore, Dangote Cement Plc is a large-cap stock within the index that served as the major factor contributing to the growth or decline of the Dangote Index. Dangote cement delivered very strong Q3 2020 results with a +64% increase in PBT from N165.85bn it posted in Q2 2020 to N271.96bn in Q3 2020. The recovery in demand from a subdued Q2 was driven by the re-starting of construction projects post the COVID-related lockdown and resumption of clinker exports to neighbouring countries. (see Chart 77)

Chart 77: Dangote Index Yields Jan. 2020 - Dec. 2020

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Chart 78: DANGCEM, DANGSUGAR, NASCON Share Price movement Jan. 2020 - Dec. 2020

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Tony Index

Tony index reported bearish and bullish stock prices at different months in the year 2020. The index recorded its lowest points in March, February, and June with -23.44%, -12.44, and -5.20% respectively. Investors' activity on the index is high, as it is mostly composed of stocks in the financial services sector (UBA, AFRIPRUD, UBCAP), which is very active on the NSE. The highest gains in the index were recorded in October, April, and November with gains of +21.69%, +14.73%, and +9.52% respectively (see Chart 79).


Chart 79: Tony Index Yields Jan. 2020 - Dec. 2020

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Chart 80: Toni AFRIPRUD, TRANSCOHOT, TRANSCORP, UBA, UBCAP Share Price movement Jan. 2020 - Dec. 2020

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The NASD Security Index year to date return rose by +5.08% in 2020. Total volume traded year-to-date stood at 7,930,325,502 units in 1498 deals while total value traded stood at N12,688,125,851.08.


NASD OTC recorded its lowest yield of -2.05% in July. Other periods of low yield were recorded in May, February, and October with declines of -1.32%, -1.10%, and -0.48% respectively. The impact of the coronavirus lockdown being lifted was reflected on the market.  The highest gains were recorded in June +3.48%, September +3.18%, and August +1.47%. In June 2020, Newrest Asl Nigeria Plc was admitted to the NASD OTC exchange.


Allianz Insurance Plc was delisted from the NASD OTC Securities Exchange on December 23, 2020. Meanwhile in May 2020, the National Insurance Commission ("NAICOM") issued a circular that increased the minimum paid-up capital requirements for all insurance license classes. NAICOM's new rules have prompted players across the industry to pursue various capital raising and restructuring initiatives aimed at bridging their respective capital shortfall. According to NAICOM's circular, Allianz Nigeria Insurance Plc has a material capital shortfall of approximately N11.8 billion. According to NASD, Allianz Nigeria's capital shortfall is unlikely to be bridged only by profit retention given the company's profitability trend leading to shareholders' decision to delist from the exchange.


Chart 81: Toni NASD Index Yields Jan. 2020-Dec. 2020

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Advancers for the Year

Four of NASD OTC stocks closed the year with a significant increase in value.

Geo-Fluids Plc, which currently holds a market capitalization of N2.93bn closes the year at N0.69 representing a
+30.19% increase from the opening price of N0.53.


Niger Delta Exploration and Production Plc, which currently holds a market capitalization of N61.68bn closed the year at N340.0, a +13.05% increase from the opening price of N300.76. Nipco Plc, which holds a market capitalization of N12.76bn closed the year at N68, a +9.68% increase from the opening price of N62.


Central Securities Clearing System Plc which has a market capitalization of N75.25 closed the year at N15.05 representing a +3.79% increase from the opening price of N305.00.


Table 27: Advancers for the Year

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Decliners for the Year


FrieslandCampinaWamco Nigeria Plc which currently has a market capitalization of N126.92bn closes the year at N130 representing a -1.52% decline from the opening price of N132.00.


Table 28: Decliners for the Year

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Downloadable Version of Goodbye 2020, Hello 2021, Understanding the Mega Trends of a Crucial Year for an Economy Report (PDF)

1.     Complete Report: Outlook 2021: Understanding the Mega Trends of a Crucial Year for an Economy- Jan 28, 2021

2.     Executive Summary: Outlook 2021: Understanding the Mega Trends of a Crucial Year for an Economy- Jan 28, 2021

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2.       How Countries Are Performing on the Road to Recovery

3.       World Bank Appears Less Optimistic About Growth Prospects Across the Globe

4.       Corruption and COVID-19: The Pandemic Has Heightened The Importance of Stronger Governance

5.       Global Output Expected to Expand by 4% in 2021, Still Below Pre-Pandemic Trend

6.       AfDB Takes Steps to Accelerate the Circular Economy in Africa

7.       World Bank Group to Boost Nigeria's Efforts to Reduce Poverty

8.       IMF Staff Completes 2020 Article IV Mission to Nigeria

9.       Open Trade and Economic Inclusion Key to Post-COVID Recovery

10.  AfDB's AgriPitch Competition Awards $120,000 in Prizes to African Youth Agripreneurs

11.  Bridging the Digital Divide to Scale Up the COVID-19 Recovery

12.  AfDB, AIF Founding Partners Announce Postponement of the Africa Investment Forum to 2021

13.  Remittance Flows to Shrink 14% by 2021 Due to COVID-19

14.  How COVID-19 Will Increase Inequality in Emerging Markets and Developing Economies

15.  SSA October 2020 Regional Economic Outlook: A Difficult Road to Recovery

16.  Communique of the 42nd Meeting of the IMFC Chaired by Mr. Lesetja Kganyago

17.  WEO: A Long and Difficult Ascent - Global Growth Projected at -4.4% in 2020

18.  IMF Executive Board Approves the Extension of Increased Access Limits Under the RCF and RFI

19.  IMF Extends Immediate Debt Service Relief for 28 Eligible Low-Income Countries for 6-months

20.  Reform of the International Debt Architecture is Urgently Needed

21.  African Development Bank Named to the Board of World Business Angels Investment Forum

22.  COVID-19's Negative Impact on Health and Education May Last Decades

23.  Opening Remarks at the 2020 International Conference on Sustainable Development

24.  World Bank Sets Ambitious Targets for Green and Resilient Economic Growth in Africa

25.  Supporting Migrants and Remittances as COVID-19 Rages On

26.  IMF Managing Director Georgieva's Remarks at the Global Steering Group Global Impact Summit

27.  Supporting Public Private Partnerships in Africa: AfDB Ready to Scale Up

28.  Event of the Finance Ministers on Financing for Development in the Era of COVID-19 and Beyond

29.  Nigeria in the Time of COVID-19 - Rising to the Challenge

30.  Final Communique of the 55th AGM of the Board of Governors of AfDB

31.  COVID-19: Without Help, Low-Income Developing Countries Risk a Lost Decade

32.  2020 Annual Meetings of the AfDB: A Renewed Commitment to Economic Resilience in Africa

33.  Tourism Trauma and COVID-19

34.  COVID-19: Youth Resilience is the Boost We Need Right Now

35.  External Sector Report: Global Imbalances and the COVID-19 Crisis


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CMO Reports

1.       Nigeria: 2021 Full Year Outlook - Awaiting Dawn

2.       Bracing for a Different Future - Meristem Annual Outlook 2021

3.       2021 Economic Outlook - Light at The End of The Tunnel

4.       The Nigerian-British Chamber of Commerce 2021 Economic Outlook

5.       Q1 2021 FX Outlook: Risk-on Stages a Comeback

6.       Nigeria Economic Outlook 2021: A Shot at Recovery

7.       2021 Outlook - Is The Tunnel Getting Darker or Brighter

8.       Nigeria in 2021: Positioning in the New Normal

9.       Nigeria 2021 Outlook - Navigating Unsteady Terrain

10.  Nigeria FY 2021 Macroeconomic Outlook - A Break in the Clouds

11.  Nigeria 2021 Outlook: COVID-19 Recession and the Long Road to Economic Recovery

12.  Q4 2020 Economic Outlook: Out of Reverse and into Second Gear

13.  Nigerian Equity Market Outlook: COVID Out, Riots In?


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Related News on Reviews and Outlooks

1.       Candid Dialogue on Africa's Investment Landscape

2.      Negative Outlook for Sub-Saharan African Sovereigns as Debt Costs Will Intensify Post Pandemic

3.      The Nigerian-British Chamber of Commerce 2021 Economic Outlook

4.      Fitch Revises Coronation Merchant Bank's Outlook to Stable; Affirms IDR at 'B-'

5.      Moody's - Nigeria's Deficit and Debt to Stay High After Coronavirus and Oil Shocks

6.      Moody's Takes Ratings Actions on 32 Banks in Africa Following Update to Country Ceilings Methodology

7.      Risks to Nigerian Banks' Asset Quality Loom in 2021 and Beyond

8.      Moody's Announces Changes in Country Ceilings Following Methodology Update

9.      Fitch Ratings Sees Gradual Recovery for African Banks in 2021

10.   DCSL to hold its 13th Webinar Series Focused on the Year 2020 Business Review

11.    Uncertain Recovery: 10 Macro Trends That Will Shape 2021

12.   Fitch Affirms Seplat at 'B-'; Outlook Positive

13.   Agusto and Co Unveils its 2020 Consumer Digital Banking Satisfaction Index

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Related News on Monetary Policy

1.       Monetary and Interest Rate Policy in 2021: Going for Growth

2.      CBN to Sustain Expansionary Monetary Policy Till Q1, 2021 - Cordros Securities

3.      Ten MPC Members, One Shared Outlook

4.      Further Slowdown in PSCE Growth in November 2020

5.      Personal Statements By The MPC Members At The 133 MPC Meeting of Nov 23-24, 2020

6.      CBN Rolls the Dice to Tackle Market Liquidity and Dollar Dearth

7.      Implications of CBN's Introduction of Its Special Bills to the Market

8.      CBN Introduces Special Bills to Deepen the Financial Markets, An Additional Liquidity Mgmt Tool

9.      Faltering Increases in Private Sector Credit Expansion

10.   Post-November 2020 MPC View: Back to the Committee's Favoured Stance

11.    CBN Communique No. 133 of the MPC Meeting - Nov 23-24, 2020

12.   As Expected, MPC Retains All Key Parameters At The End of November 2020 Meeting

13.   Monetary Policy Committee Decision Preview: MPC Expected to Retain Policy Parameters - Access Bank

14.   A Pause to Reflect from the MPC

15.   LDR Policy: Over One Year After, Where Are We?

16.   Monetary Policy Response in Emerging Market Economies: Why Was it Different this Time?

17.    Endorsement of the CBN's Development Finance

18.   Slowdown in the Expansion of PSCE

19.   Personal Statements By The MPC Members At The 132 MPC Meeting of Sep 21-22, 2020

20.  MPC Surprise Rate Cut: Limited Impact on Credit Growth

21.   LDR Policy: Plausible But Insufficient to Stimulate Growth

22.  Banks Lend, the CBN Pushes Forbearance

23.  Low Liquidity Expected to Dampen Impact of Lower Rates

24.  Possible Implications of MPC's 100bps Policy Rate Cut

25.   CBN Communique No. 132 of the MPC Meeting - Sep 21-22, 2020

26.  CBN MPC Reduces MPR to 11.50%, Retains Other Parameters After Sept 2020 Meeting

27.   An Eye into Possible MPC Outcomes

28.  MPC Preview: Balancing FX Stability and Moderating Economic Contraction

29.  Several Pointers to Same Again From the MPC

30.  Implications of CBN's Downward Review of the Interest Rate on Savings Deposit

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Related News on Fiscal Policy

1.       Nigeria Fiscal Guide 2020

2.      SERAP Calls for Simplification of Government Processes for COVID-19 Management in Nigeria

3.      SERAP Calls for No Budget Allocation to MDAs That Fail to Remit to Federation Account

4.      FGN Revises Excise Regime and Removes Import Duty on Materials Used in The Production of Banknotes

5.      DMO Clarifies China's Loans to Nigeria; Economic Viability and Revenue Issues Left Out

6.      Taiwo Oyedele To Speak on Nigeria's Fiscal Sustainability Tomorrow on WebTV

7.      Suleyman Ndanusa To Speak on Nigeria's Revenue Diversification Tomorrow on WebTV

8.      Addendum to the 2020 - 2022 MTEF and Fiscal Strategy Paper

9.      LCCI Report Affirms Need for Fiscal Authorities to Act

10.   Framework for the Management of COVID-19 Funds in Nigeria under the Treasury Single Account

11.    COVID-19: Federal Government Exempts Medical Supplies from VAT and Import Duty

12.   Stimulant is Necessary but not Sufficient - FDC

13.   Fiscal Position: Still Critical but Temporary Panacea in Sight

14.   Pick and Mix in Nigeria's Response to the COVID-19 Virus - FBNQuest

15.   FG Adds to Armory for COVID-19 Showdown

16.   COVID-19: Federal Government of Nigeria Announces Fiscal Stimulus Measures

17.    Fiscal and Monetary Responses to COVID-19 Menace: Racing Against Time

18.   FG Launches Financial Transparency Policy Portal

19.   Treasury Single Account - The Puerto Rican Government Earned $49m in Interest Fiscal YTD

20.  Friedrich Hayek and The Price System: The Future Of Classical Liberalism and The Free Market

21.   Economic and Institutional Restructuring for the Next Nigeria - Soludo

22.  How Government Policy Affects Business , Society In National Development and Changing Environment

23.  Nigeria's Fiscal Quandary: A Revenue Problem Or A Debt Problem?

24.  Irrespective of Who Wins 2019 Elections, ERGP Should Be Sustained - Toyin Sanni

25.   2019-2021 MTEF and Fiscal Strategy - First Fiscal Projections Through to 2021

26.  Government Role In The Economy - Differentiating Policies And What Elections2019 Comes Down To

27.   Federal Government releases 2018 Fiscal Policy Measures

28.  Buhari Signs Bills Granting Financial Autonomy To State Assembly And Judiciary; Signs 3 Others

29.  NESG leads Discourse on Low Carbon Investments Opportunities in Nigeria

30.  NESG establishes Nigeria Fiscal Policy Roundtable to help boost government revenues

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Related News on Nigerian Economy

1.       Nigerian GDP Better Than Thought

2.      Inflation Spikes Despite Harvest and Land Border Re-opening

3.      Nigeria's Misery Index Rises as Inflation Reaches 15.75%

4.      FGN to Convert CBN Loans to Tradable Securities as Debt Soars

5.      Headline Inflation Increases by 15.75% YoY In December 2020, 0.86% Higher Than November 2020 Rate

6.      FGN's External Debt Service Obligations Reached a Total of US$507m in Q3 2020

7.      Nigeria's High Recurrent Costs, Low Revenue and Escalating Debt Numbers

8.      62.18% of Nigeria's Total Public Debt as of Q3 2020 Was Domestic - NBS

9.      Q4 2020 Macroeconomic and Markets Report - Growth Expectations Remain Gloomy for Nigerian Economy

10.   Rising Crude Oil Prices and the Nigerian Economy

11.    COVID-19 Containment and ESP Implementation Key for Nigeria's Economic Recovery - Prof. Akpan Ekpo

12.   Q3 2020 Debt Stock: World Bank Almost The Largest External Creditor

13.   Headline Inflation to Continue its Runaway Trend in December 2020

14.   FGN's Domestic Debt Service on a Plateau, Totalled N604bn in Q3 2020

15.   Naira Crawling Peg?

16.   PMI Reading No 93: A Seasonal High for the Year

17.    Nigeria's Public Debt Stock as of September 30, 2020 Stood at N32.22trn

18.   The Year 2020 in Retrospect: A Bleak Year for Households

19.   All Commodity Group Import Index Rose by 1.89% in Q3 2020 - NBS

20.  A Year in Two Charts

21.   PMI Readings Show Pessimism in the Month of December 2020

22.  FGN's Q3 2020 Deficit on Target, Spending Compressed

23.  CBN Poll: Respondent Firms Expect the Naira to Depreciate Next Month

24.  Economic Crisis to Sink 7million People into Poverty in Nigeria

25.   Revenue Collection Again Below Benchmark in Q3 2020

26.  CBN Poll: 60.8% of Respondents Believe Nigerian Economy would End Up Weaker if Prices Rise Faster

27.   Interest Rates on the Rise

28.  The Nigeria's FX Crisis: Overarching Consequences of Insecurity and Structural Deficiency

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Special Reports & Publications

1.      Oil and Gas: Working the New Normal in the Time of a Pandemic

2.     Banks in H1 2020: Imagining Beyond COVID-19

3.     Online Trading Ranking Report 2020 - Trading in a Period of a Virus; Building Good Habits

4.     Banks in H1 2020: Imagining Beyond COVID-19

5.     CEO Remuneration 2020 Report: Between 2019 and 2020; Understanding The New Realities

6.     Memo To AMCON: Nigerian Tax Payers are not Responsible for Repayment of Bad Debt

7.     Coronanomics (1) - Understanding the Realities of an Impending Recession

8.     Bank NPLs  - The Case for a New Industry Approach

9.     NCM2020 - Fin. MKT in Transition: Understanding Past Uncertainties; Preparing for New Possibilities

10.  Banks' H1 2019 Numbers: Top Line Growth, Bottom Line Uncertainty

11.   Budget 2019: The Hidden Monsters

12.  Surviving Uncertain Times in the Nigerian Financial Market

13.  The Rich, The Poor and Buharinomics

14.  Nigerian Banks- Performance - H1 2018

15.  AMCON and Financial Services Debt Burden in Nigeria

16.  Poverty Tracker and Nigeria: Raising The Red Flag

17.  POCKET Economics: Addressing Income Inequality

18.  The Silent Drug Epidemic: A Gathering Storm

19.  Judging IMF’s Position on Development Indices

20. Money Market: The Folk Road

21.  The Headache of Missing Targets

22. 2018 Outlook on the Nigerian Economy: The Need for an Even Keel

23. Nigeria External Economy and the White Noise of Import Dependency

24. States and the Rising Weight of Debt

25. Money Supply: Reeling from Policy Response


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