Coronanomics: Inside Nigeria's Stock Market Response

Proshare

Wednesday, March 11, 2020 /08:30 PM / TheAnalyst/Proshare Research / Header Image Credit: EcoGraphics

 

With the Coronavirus becoming an increasing menace to global economies equity markets from the beginning of the week have been dropping like dead flies. Most of the week's fall was attributed to the failure of the Organisation of Petroleum Exporting Countries (OPEC) to come to agreement with their non-OPEC (OPEC+) counterparts to a cutback in international oil supply by an additional 1.5m barrels per day. The drop in oil prices has led to a contagion fall in other global markets, including equities market.


The inability to reach an agreement saw Saudi Arabia cut oil price by over 30% to retain market share and send a message to other oil producers that it was prepared for a trade war. The impact has been devastating for global markets as the price of Brent tumbled to just over US$34.00 per barrel on Monday, March 09, 2020 before gaining about +6% on Tuesday's close at slightly over US$37.00 per barrel. Wednesday saw the market, stumble again as the Saudi government gave instructions to the State-controlled oil company, Aramco, to increase production. The market price of Brent dropped to US$36.09 per barrel by Wednesday's business close. The fall in Brent and WTI prices has mirrored the bloodletting that has taken place in markets for equities around the world with the Nigerian bourse losing over -12.46% year-to-date (YTD) and -24.72% year-on-year (Y-o-Y).


Since the beginning of the week the oil market has witnessed distortions caused largely by the fall in oil demand in China and the Asian Pacific region. China, which is the largest importer of oil in the world has recorded a significant decline in demand caused largely by restrictions in movement to combat the coronavirus.


Nigeria's have shifted into anxiety mode as oil prices dipped below the US$57 per barrel on which the 2020 budget was premised. The fall in oil prices has compelled both the fiscal and monetary authorities to rethink the whole economic management framework in 2020. The concerns of equity traders has been reflected in massive stock sell offs as everybody tries pushing through the door at the same time. What looks like a stampede from the equities market would likely translate to a dollar rush as asset managers exit Naira positions and take flight to safety in dollar-denominated investments, at least in the short-term. 


Proshare Nigeria Pvt. Ltd.


Blues for the Banks

The banking sector was the worst hit sector in the equities market as stocks took a plunge daily.


Week-to-date banking stocks performance reveals that all banking stocks recorded a dip in their stock-prices The top three banking stocks with the highest dips recorded using their week-to-date performance includes ZENITHBANK, ACCESS and UBN with percentage decline of -28.91%, -15.69% and -14.89% respectively while the stocks that recorded the lowest dip includes FCMB, UBA and UNITYBANK with a percentage decline of -0.60%, -0.80% and -2.08% respectively (see Table 1 below).


Table 1: WTD and MTD Performance of Banking Stocks listed on the Nigerian Stock Exchange

Banking Stocks

S/No

Symbol

31-Dec-19

28-Feb-20

%  Chg

9-Mar-2020

11-Mar-20

WTD %

MTD %

1

ACCESS

10.00

            8.20

-18.00%

           7.65

            6.45

-15.69%

-21.34%

2

ETI

6.50

            5.40

-16.92%

           5.30

            4.85

-8.49%

-10.19%

3

FBNH

6.15

            4.70

-23.58%

           4.85

            4.40

-9.28%

-6.38%

4

FCMB

1.85

              1.71

-7.57%

           1.67

             1.66

-0.60%

-2.92%

5

FIDELITYBK

2.05

             1.95

-4.88%

           1.80

             1.70

-5.56%

-12.82%

6

GUARANTY

29.70

23.80

-19.87%

22.15

19.90

-10.16%

-16.39%

7

STANBIC

41.00

32.50

-20.73%

31.50

28.35

-10.00%

-12.77%

8

STERLNBANK

1.99

1.40

-29.65%

1.41

1.27

-9.93%

-9.29%

9

UBA

7.15

6.70

-6.29%

6.25

6.20

-0.80%

-7.46%

10

UBN

6.00

6.50

8.33%

7.05

6.00

-14.89%

-7.69%

11

UNITYBNK

0.64

0.50

-21.88%

0.48

0.47

-2.08%

-6.00%

12

WEMABANK

0.74

0.54

-27.03%

0.55

0.51

-7.27%

-5.56%

13

ZENITHBANK

18.60

18.50

-0.54%

16.95

12.05

-28.91%

-34.86%

Source: NSE, Proshare Research


The top three stocks with the highest dip using Month-to-date performance are ZENITHBANK, ACCESS and GUARANTY with a percentage decline by -34.86%, -21.34% and -16.39% respectively.


The oil and gas stocks week-to-date performance showed that the share price of 10 stocks were flat, while 2 oil and gas stocks share price dipped. The 2 oil-stocks that were bearish are CONOIL and OANDO with a percentage decline of -9.88% and -13.58% respectively (see table 2 below).


Table 2: WTD and MTD Performance of Oil and Gas Stocks listed on the Nigerian Stock Exchange

Oil and Gas Stocks

S/No

Symbol

31-Dec-19

28-Feb-20

%  Chg

9-Mar-2020

11-Mar-20

WTD %

MTD %

1

ANINO

0.25

0.25

0.00%

0.25

0.25

0.00%

0.00%

2

CAPOIL

0.2

0.20

0.00%

0.20

0.20

0.00%

0.00%

3

CONOIL

18.50

18.00

-2.70%

16.20

14.60

-9.88%

-18.89%

4

ETERNA

3.60

1.99

-44.72%

2.02

2.02

0.00%

1.51%

5

FO

18.10

17.00

-6.08%

15.30

15.30

0.00%

-10.00%

6

JAPAULOIL

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

7

MOBIL

147.90

133.20

-9.94%

146.50

146.50

0.00%

9.98%

8

MRS

15.30

13.80

-9.80%

13.80

13.80

0.00%

0.00%

9

OANDO

3.99

2.70

-32.33%

2.43

2.10

-13.58%

-22.22%

10

RAKUNITY

0.3

0.30

0.00%

0.30

0.30

0.00%

0.00%

11

SEPLAT

657.80

605.00

-8.03%

605.00

605.00

0.00%

0.00%

12

TOTAL

110.90

107.00

-3.52%

107.00

107.00

0.00%

0.00%

Source: NSE, Proshare Research


Month-to-date oil performance reveals that 7 stocks were flat i.e. recorded no change in their share price while 3 oil and stocks dipped and 2 oil and gas stocks were bullish. The 3 oil and gas stocks that dipped were FO, CONOIL, and OANDO with a percentage decline of -10%, -18.89% and -22.22% respectively. The 2 stocks which were bullish are ETERNA and MOBIL with percentage increase of +1.51% and +9.98% respectively.


The week-to-date performance of all the NSE sector index were bearish except the NSE-ASeM which was flat. The NSE banking sector index had a decline of -22.51% week-to-date change with the NSE Oil and Gas sector index also recording a fall of -3.01% week-to-date change. This was as a result of panic in the equity market due to the fall in oil-price on 9th March, 2020 which was termed a 'Bloody Monday' as result of the huge losses recorded in the equities market. The panic in the equity market caused a huge sell-off of the stocks in these sectors majorly the NSE banking and NSE AFRBVI. The NSE AFRBVI index reflects the performance of the NSE banking index, and NSE AFRBVI recorded the highest decline with a -24.20% week-to-date change. The NSE Oil and Gas index recorded the lowest decline amongst the other sector index with a -3.01% week-on-week change.


The Dangote and Elumelu indexes both recorded a week-to-date loss, they fell by -10.16% and -10.61% respectively (see Table 3 below).


Table 3: WTD Market Performance of NSE Sector Indices

Market Performance

Sectors

06-Mar-20

11-Mar-20

WTD Chg

NSE ASI

26,279.61

23,572.75

-10.30%

NSE-30

1,149.44

1,017.84

-11.45%

NSE Consumer Goods

431.16

382.79

-11.22%

NSE Banking

327.43

253.73

-22.51%

NSE Insurance

117.93

114.3

-3.08%

NSE Oil and Gas

235.88

228.78

-3.01%

NSE LII

1,824.35

1,685.17

-7.63%

NSE-IND

1,162.79

1,110.62

-4.49%

NSE-ASeM

734.99

734.99

0.00%

NSE Pension

974.73

888.95

-8.80%

NSE Premium

2,289.08

2,024.39

-11.56%

NSE Main Board

1,015.86

936.12

-7.85%

NSECG

937.18

768.84

-17.96%

NSEAFRBVI

894.25

677.81

-24.20%

NSEAFRHDYI

1,371.92

1,193.03

-13.04%

NSEMERIGRW

1,163.57

1,049.67

-9.79%

NSEMERIVAL

1,481.39

1,224.29

-17.36%

Dangote Index

89.37

80.29

-10.16%

Elumelu Index

84.29

75.35

-10.61%

Source: NSE, Proshare Research

 

Waiting for A break

Will the market decline break anytime soon? Uncertainty is the hallmark of the current market downturn.  The equity market bloodbath is not expected to let up as Saudi Arabia indicates that it would make a further sale of oil to bring its total production to 12.3m barrels per day by April 2020. The initiation of hidden value triggers are becoming increasingly apparent as investors bolt towards alternative asset safety.  


Appendix:

Performance Review of All Listed Stocks on NSE

S/No

Symbol

31-Dec-19

28-Feb-20

%  Chg

09-Mar-20

11-Mar-20

WTD %

MTD %

1

ABBEYBDS

             1.00

               1.05

5.00%

               1.05

               1.05

0.00%

0.00%

2

ABCTRANS

            0.45

              0.30

-33.33%

               0.31

              0.32

3.23%

6.67%

3

ACADEMY

             0.37

              0.37

0.00%

               0.37

              0.37

0.00%

0.00%

4

ACCESS

          10.00

              8.20

-18.00%

               7.65

              6.45

-15.69%

-21.34%

5

AFRINSURE

            0.20

              0.20

0.00%

              0.20

              0.20

0.00%

0.00%

6

AFRIPRUD

            4.00

              4.70

17.50%

              4.00

              4.00

0.00%

-14.89%

7

AFROMEDIA

            0.34

              0.34

0.00%

               0.34

              0.34

0.00%

0.00%

8

AIICO

            0.72

              0.77

6.94%

               0.75

              0.73

-2.67%

-5.19%

9

AIRTELAFRI

       298.90

         298.90

0.00%

         298.90

         298.90

0.00%

0.00%

10

ALEX

             8.10

              8.10

0.00%

               8.10

              8.10

0.00%

0.00%

11

ANINO

0.25

              0.25

0.00%

               0.25

              0.25

0.00%

0.00%

12

ARBICO

             3.51

               3.16

-9.97%

               3.16

               3.16

0.00%

0.00%

13

ASOSAVINGS

            0.50

              0.50

0.00%

               0.50

              0.50

0.00%

0.00%

14

AUSTINLAZ

            2.09

              2.03

-2.87%

               2.03

              2.03

0.00%

0.00%

15

BERGER

             6.75

              6.75

0.00%

               6.10

              6.10

0.00%

-9.63%

16

BETAGLAS

          53.80

           70.00

30.11%

            70.00

           70.00

0.00%

0.00%

17

BOCGAS

             5.50

              4.05

-26.36%

               4.05

              4.05

0.00%

0.00%

18

CADBURY

           10.55

              8.10

-23.22%

               7.35

              6.00

-18.37%

-25.93%

19

BUACEMENT

          38.45

             37.15

-3.38%

             35.30

            35.30

0.00%

-4.98%

20

CAP

          24.00

           24.60

2.50%

             22.15

            19.95

-9.93%

-18.90%

21

CAPHOTEL

             2.75

              2.75

0.00%

               2.75

              2.75

0.00%

0.00%

22

CAPOIL

0.2

              0.20

0.00%

              0.20

              0.20

0.00%

0.00%

23

CAVERTON

            2.67

              2.48

-7.12%

               2.36

              2.10

-11.02%

-15.32%

24

CHAMPION

            0.95

              0.81

-14.74%

               0.78

              0.78

0.00%

-3.70%

25

CHAMS

             0.33

              0.24

-27.27%

              0.22

              0.22

0.00%

-8.33%

26

CHELLARAM

            2.78

              2.78

0.00%

               2.78

              2.78

0.00%

0.00%

27

CILEASING

            5.90

              6.85

16.10%

               6.85

              6.85

0.00%

0.00%

28

CONOIL

           18.50

            18.00

-2.70%

             16.20

            14.60

-9.88%

-18.89%

29

CORNERST

            0.45

               0.51

13.33%

               0.45

              0.49

8.89%

-3.92%

30

COURTVILLE

            0.23

              0.20

-13.04%

              0.20

              0.22

10.00%

10.00%

31

CUSTODIAN

            6.00

              5.45

-9.17%

               5.45

              5.45

0.00%

0.00%

32

CUTIX

             1.33

               1.32

-0.75%

               1.40

              1.28

-8.57%

-3.03%

33

CWG

            2.54

              2.54

0.00%

               2.54

              2.54

0.00%

0.00%

34

DAARCOMM

            0.36

              0.33

-8.33%

               0.33

              0.33

0.00%

0.00%

35

DANGCEM

        142.00

          170.00

19.72%

          170.00

          153.00

-10.00%

-10.00%

36

DANGSUGAR

           13.60

             12.10

-11.03%

             11.00

              9.75

-11.36%

-19.42%

37

DEAPCAP

            0.40

              0.36

-10.00%

               0.33

              0.33

0.00%

-8.33%

38

DUNLOP

            0.20

              0.20

0.00%

              0.20

              0.20

0.00%

0.00%

39

EKOCORP

            4.25

              5.50

29.41%

               5.50

              5.50

0.00%

0.00%

40

ELLAHLAKES

            4.25

              4.25

0.00%

               4.25

              4.25

0.00%

0.00%

41

ENAMELWA

          22.10

            22.10

0.00%

             22.10

            22.10

0.00%

0.00%

42

ETERNA

            3.60

              1.99

-44.72%

              2.02

              2.02

0.00%

1.51%

43

ETI

            6.50

              5.40

-16.92%

               5.30

              4.85

-8.49%

-10.19%

44

ETRANZACT

             2.61

              2.61

0.00%

               2.61

              2.61

0.00%

0.00%

45

EVANSMED

            0.50

              0.50

0.00%

               0.50

              0.50

0.00%

0.00%

46

FBNH

             6.15

              4.70

-23.58%

               4.85

              4.40

-9.28%

-6.38%

47

FCMB

             1.85

               1.71

-7.57%

               1.67

              1.66

-0.60%

-2.92%

48

FIDELITYBK

            2.05

               1.95

-4.88%

               1.80

               1.70

-5.56%

-12.82%

49

FIDSON

             3.10

              2.54

-18.06%

               2.54

              2.55

0.39%

0.39%

50

FLOURMILL

19.70

22.00

11.68%

22.00

22.00

0.00%

0.00%

51

FO

18.10

17.00

-6.08%

15.30

15.30

0.00%

-10.00%

52

FTNCOCOA

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

53

GLAXOSMITH

6.10

4.20

-31.15%

3.45

3.45

0.00%

-17.86%

54

GOLDBREW

0.89

0.81

-8.99%

0.81

0.81

0.00%

0.00%

55

GOLDINSURE

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

56

GSPECPLC

4.65

4.65

0.00%

4.65

4.65

0.00%

0.00%

57

GUARANTY

29.70

23.80

-19.87%

22.15

19.90

-10.16%

-16.39%

58

GUINEAINS

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

59

GUINNESS

30.05

25.20

-16.14%

25.20

25.20

0.00%

0.00%

60

HMARKINS

0.39

              0.27

-30.77%

               0.30

              0.30

0.00%

11.11%

61

HONYFLOUR

0.99

1.00

1.01%

0.87

0.92

5.75%

-8.00%

62

IKEJAHOTEL

1.12

1.21

8.04%

1.21

1.21

0.00%

0.00%

63

INFINITY

1.39

1.39

0.00%

1.36

1.36

0.00%

-2.16%

64

INITSPLC

0.7

0.70

0.00%

0.70

0.70

0.00%

0.00%

65

INTBREW

9.50

7.05

-25.79%

7.05

6.35

-9.93%

-9.93%

66

INTENEGINS

0.38

0.38

0.00%

0.38

0.38

0.00%

0.00%

67

INTERLINK

3.20

2.91

-9.06%

2.91

2.91

0.00%

0.00%

68

JAIZBANK

0.62

0.55

-11.29%

0.52

0.48

-7.69%

-12.73%

69

JAPAULOIL

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

70

JBERGER

19.90

22.40

12.56%

22.40

22.40

0.00%

0.00%

71

JOHNHOLT

0.56

0.56

0.00%

0.56

0.56

0.00%

0.00%

72

JULI

1.51

1.51

0.00%

1.51

1.51

0.00%

0.00%

73

LASACO

0.25

0.23

-8.00%

0.22

0.20

-9.09%

-13.04%

74

LAWUNION

0.50

0.90

80.00%

1.00

1.00

0.00%

11.11%

75

LEARNAFRCA

1.13

1.12

-0.88%

1.11

1.11

0.00%

-0.89%

76

LINKASSURE

0.53

0.42

-20.75%

0.40

0.40

0.00%

-4.76%

77

LIVESTOCK

0.50

0.63

26.00%

0.61

0.57

-6.56%

-9.52%

78

MANSARD

1.98

1.68

-15.15%

1.68

1.67

-0.60%

-0.60%

79

MAYBAKER

1.93

1.96

1.55%

2.15

2.15

0.00%

9.69%

80

MBENEFIT

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

81

MCNICHOLS

0.46

0.46

0.00%

0.46

0.46

0.00%

0.00%

82

MEDVIEWAIR

1.62

1.62

0.00%

1.62

1.62

0.00%

0.00%

83

MEYER

0.54

0.46

-14.81%

0.46

0.46

0.00%

0.00%

84

MOBIL

147.90

133.20

-9.94%

146.50

146.50

0.00%

9.98%

85

MORISON

0.50

0.50

0.00%

0.50

0.50

0.00%

0.00%

86

MRS

15.30

13.80

-9.80%

13.80

13.80

0.00%

0.00%

87

MTNN

105.00

110.00

4.76%

115.00

103.50

-10.00%

-5.91%

88

MULTITREX

0.36

0.36

0.00%

0.36

0.36

0.00%

0.00%

89

MULTIVERSE

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

90

NAHCO

2.40

2.61

8.75%

2.25

2.14

-4.89%

-18.01%

91

NASCON

12.95

13.00

0.39%

13.00

10.55

-18.85%

-18.85%

92

NB

59.00

40.50

-31.36%

36.75

33.00

-10.20%

-18.52%

93

NCR

4.50

2.43

-46.00%

2.20

2.20

0.00%

-9.47%

94

NEIMETH

0.62

0.46

-25.81%

0.40

0.44

10.00%

-4.35%

95

NEM

2.42

1.80

-25.62%

1.73

1.75

1.16%

-2.78%

96

NESF

552.20

552.20

0.00%

552.20

552.20

0.00%

0.00%

97

NESTLE

1469.90

1130.00

-23.12%

1017.00

915.30

-10.00%

-19.00%

98

NIGERINS

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

99

NIG-GERMAN

3.62

3.62

0.00%

3.62

3.62

0.00%

0.00%

100

NNFM

4.30

4.30

0.00%

4.30

4.30

0.00%

0.00%

101

NOTORE

62.50

62.50

0.00%

62.50

62.50

0.00%

0.00%

102

NPFMCRFBK

1.15

0.95

-17.39%

0.94

0.93

-1.06%

-2.11%

103

NSLTECH

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

104

OANDO

3.99

2.70

-32.33%

2.43

2.10

-13.58%

-22.22%

105

OKOMUOIL

55.60

68.00

22.30%

61.40

61.40

0.00%

-9.71%

106

OMATEK

0.50

0.41

-18.00%

0.37

0.37

0.00%

-9.76%

107

OMOSAVBNK

0.55

0.55

0.00%

0.55

0.55

0.00%

0.00%

108

PHARMDEKO

1.50

1.50

0.00%

1.50

1.50

0.00%

0.00%

109

PORTPAINT

2.23

2.23

0.00%

2.23

2.23

0.00%

0.00%

110

PREMPAINTS

9.40

9.40

0.00%

9.40

9.40

0.00%

0.00%

111

PRESCO

47.50

44.90

-5.47%

44.90

44.90

0.00%

0.00%

112

PRESTIGE

0.55

0.55

0.00%

0.55

0.55

0.00%

0.00%

113

PZ

5.65

4.50

-20.35%

4.45

4.05

-8.99%

-10.00%

114

RAKUNITY

0.3

0.30

0.00%

0.30

0.30

0.00%

0.00%

115

REDSTAREX

4.45

3.25

-26.97%

3.00

3.00

0.00%

-7.69%

116

REGALINS

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

117

RESORTSAL

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

118

ROADS

6.60

6.60

0.00%

6.60

6.60

0.00%

0.00%

119

ROYALEX

0.30

0.22

-26.67%

0.22

0.22

0.00%

0.00%

120

RTBRISCOE

0.21

0.20

-4.76%

0.20

0.20

0.00%

0.00%

121

SCOA

2.93

2.93

0.00%

2.93

2.93

0.00%

0.00%

122

SEPLAT

657.80

605.00

-8.03%

605.00

605.00

0.00%

0.00%

123

SKYAVN

4.19

2.13

-49.16%

2.34

2.34

0.00%

9.86%

124

SKYESHELT

85.50

69.30

-18.95%

69.30

69.30

0.00%

0.00%

125

SMURFIT

0.29

0.29

0.00%

0.29

0.29

0.00%

0.00%

126

SOVRENINS

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

127

STACO

0.48

0.48

0.00%

0.48

0.48

0.00%

0.00%

128

STANBIC

41.00

32.50

-20.73%

31.50

28.35

-10.00%

-12.77%

129

STDINSURE

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

130

STERLNBANK

1.99

1.40

-29.65%

1.41

1.27

-9.93%

-9.29%

131

STUDPRESS

1.99

1.99

0.00%

1.99

1.99

0.00%

0.00%

132

SUNUASSUR

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

133

TANTALIZER

0.20

0.20

0.00%

0.20

0.20

0.00%

0.00%

134

THOMASWY

0.38

0.35

-7.89%

0.35

0.35

0.00%

0.00%

135

TOTAL

110.90

107.00

-3.52%

107.00

107.00

0.00%

0.00%

136

TOURIST

3.50

3.15

-10.00%

3.15

3.15

0.00%

0.00%

137

TRANSCOHOT

4.90

4.05

-17.35%

4.05

4.05

0.00%

0.00%

138

TRANSCORP

0.99

0.88

-11.11%

0.77

0.76

-1.30%

-13.64%

139

TRANSEXPR

0.92

0.90

-2.17%

0.90

0.90

0.00%

0.00%

140

TRIPPLEG

0.64

0.58

-9.38%

0.58

0.58

0.00%

0.00%

141

UACN

8.60

7.40

-13.95%

7.95

7.50

-5.66%

1.35%

142

UAC-PROP

1.00

0.83

-17.00%

0.92

0.92

0.00%

10.84%

143