Saturday, March 02, 2019 08:00 AM / Proshare Content
Nigeria: Economic Dashboard @ 010319
Source: Vetiva Weekly Market Wrap – March 01, 2019
Bears Dominate Equity Market, ASI Declines 212bps WoW
After a broadly negative week, the Nigerian Bourse gained 34bps today for the second time, leading to a cummulative loss of -212bps w/w. Breaking it down, the Banking (+40bps d/d, -588bps w/w) sectors closed the week down despite recording the highest gains on Friday, thanks to ACCESS (+351bps d/d, -781bps w/w) and UBA (+201bps d/d, -500bps w/w). Similarly, the Oil & Gas (+30bps d/d, -133bps w/w) and Industrial Goods (+26bps d/d, +93bps w/w) sectors ended the day in the green when TOTAL (+526bps d/d, +256bps w/w) and DANGCEM (+67bps d/d, +218bps w/w) moved up. Finally, the Consumer Goods sector (+8bps) gained marginally after upticks in HONYFLOUR (+305bps d/d) and NESTLE (+272bps d/d, -433bps) erased losses in UNILEVER (-561bps d/d, -10.00% w/w) and INTBREW (-476bps d/d, w/w).
• Given the reaction of investors to the election results this week, we highlight the possibility of negative sentiment trickling down into the market next week. That said, we expect bargain hunting to drive positive trading as investors take up undervalued stock leading to a mixed session at week start.
• Stock Watch: CORNERST is the best perfoming stock on the exchange this week, gaining 19% over three of five sessions. The stock gained 8.70% today to settle at ?0.25, its highest price since September 2018.
Yields decline even further as positive trading persists
• The CBN conducted its bi-monthly T-bills PMA on Wednesday, selling its full offer of ?115 billion across the 91DTM, 182DTM and 364DTM bills at stop rates of 10.90%, 13.01% and 14.37% (Effective rates: 11.20%, 13.91% and 16.77%) – lower than previous auction levels. Meanwhile, the CBN also slowed down frequency of OMO auctions, conducting just one on Thursday and selling ?1.08 trillion (Offer:?400 billion), across the 91DTM, 182DTM and 364DTM bills at stop rates of 11.90%, 13.50% and 14.30% (Effective rates: 12.26%, 14.47% and 16.68%). Notably, whilst stop rates were unchanged on the 91DTM and 182DTM, they moderated significantly (70bps) on the 364DTM bill. Amidst this, the Interbank Call rate declined 250bps w/w to settle at 16.33%.
• With the CBN continuing the slowdown of aggressive liquidity mop-ups this week, yields declined an average of 148bps w/w in the T-bills secondary market. Particularly, the yields on 27DTM, 188DTM and 342DTM bills declined 264bps w/w, 198bps w/w and 202bps w/w respectively to settle at 9.39%, 12.90% and 15.22%. Similarly, the bond market saw increased participation from both local and foreign investors, leading to stronger demand for securities. Overall, trading was broadly bullish, with yields declining 54bps w/w on average. Specifically, the yields on the 13.98% FGN FEB 2028 and 16.2499% FGN APR 2037 bonds declined 83bps and 63bps respectively w/w to close at 13.86% and 13.84%.
• Given the change in frequency of OMO auctions over the past two weeks, we interprete this as a change in CBN’s liquidity stance and expect this trend to continue. That said, we except demand to remain elevated in the Fixed Income market next week even as investor interest strengthens.
Monday, March 04, 2019
The Nigeria Stock Exchange will on this day hold a Fixed Income Workshop at the Stock Exchange House Marina, Lagos, while the Digital Marketing Training for Women will hold on same day at the Civic Innovation Lab in Abuja.
Tuesday, March 05, 2019
The Information and Data Analytics Foundation (IDAF) will on this day hold its Big Data and Business Analytics Conference at the Radisson Blu Hotel GRA Ikeja, while the International Law Association will hold its 5th Annual Conference at Lekki Peninsula Phase 1, Lagos.
Wednesday, March 06, 2019
The Economist Intelligence Unit Webinar on the subject “US-China trade relations after the deadline: where next?” will hold today.
Thursday, March 07, 2019
Friday, March 08, 2019
The Nigeria Stock Exchange will on this day hold the International Women’s Day Symposium 2019 at the Stock Exchange House, while will unveil its New Corporate Identity.
The Lagos Chamber of Commerce and Industry will on this day hold conference themed “Agenda for Buhari’s Administration” at the Commerce House, Victoria Island Lagos
Saturday, March 09, 2019
The Gubernatorial Election to elect Governors of States will hold on this day across the nation.
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