Nigerian Financial Markets Review - 220508



Economic Update

Following increasing demand for Oil, prices have continued to rally at the international market lately. Indeed, Crude traded at $140/barrel today. Analysts have forecast the price of Oil to reach $200/barrel this year        


Debt Management Office (DMO) has revealed that domestic government debt is estimated at N2.2tr.            


Nigerian government has imported 100,000 tons of Thai Rice, worth $105mn, to curtail lingering food crisis. More imports are proposed over the next few months.      


Equity Market

Overall market performance was down today as ASI declined by 0.54% to 61,263.14 points. However, total market capitalization grew by 1.03% to N12.06tr. Despite the decline in market performance, market capitalization of listed equities increased as a result of the listing of over 7.1bn shares in the name of PLATINUM (Bank PHB), following the conclusion of its public offering earlier this year. Market volumes dropped by 39.3% to 509mn shares valued at N8.47bn in 17,844 deals.


Gainers to losers’ ratio remained flat at 0.61:1 as market breath remained firm at -0.14.   


155 equities were traded today, of this, 35 (22%) appreciated in price, 57 (37%) closed lower, while 63 (41%) closed unchanged.


NASCON announced its financial performance for the year ended Dec-07 with a turnover growth of 46,915% to N6.3bn, whilst growing net profits by 8,625% to N1.3bn. The company’s management recommended a twin benefit declaration comprising a cash dividend of N0.40 and a bonus issue of “1 for 5”. Closure date ranges between 24th and 27th June 2008, while payment will be made on 17th July 2008. The market reacted to the impressive result, bidding its price 4.97% higher to N18.18. We anticipate further appreciation in its share price.


Interlinked Technologies Plc also released financial results today. For its Half Year ended Dec-07, the company’s turnover grew by 151% to N67.9mn, while net profit leaped by 1,642% to N20.9mn.


The share price of ECOBANK Nigeria was adjusted today for a dividend of N0.24. Following the adjustment, the stock closed at N9.08.


A total of 7,111,213,559 shares were added to the shares outstanding of PLATINUM HABIB BANK (Bank PHB) Plc, following the conclusion of its public offering earlier this year. With the additional listing, total outstanding shares in the Bank have increased to 15.15bn.


The top five gainers for today were ASOSAVINGS, N7.56; UAC-PROP, N24.99; PRESCO, N26.55; BIGTREAT, N8.66 and NASCON, N18.18.      


ARBICO, JAPAUL, EKOCORP, JOSBREW and OANDO led other losers with maximum possible depreciation to N27.36, N12.35, N11.40, N5.70 and N198.55 respectively. We anticipate reversal in the share prices of AFPRINT, DUNLOP, SKYE and LASACO.             


Today’s most active stocks were IAINSURE, 66.8mn; FIDELITY, 24.4mn; UBA, 21.7mn, INTERCONT, 19.9mn and DIAMONDBNK, 17.6mn shares.                             


Five stocks including ASOSAVINGS, N7.56, IAINSURE, N1.95 and PRESCO, N26.55 reached new 52-week highs today.                


Fixed Income Market

The gains previously recorded at the FGN Bond market were lost by selected issues today. The most affected were existing 7-year tenors.                


Money Market

Key money market rates were down today due to the release of FAAC funds a few days ago. The CBN has attempted to mop up market liquidity by issuing fresh bills worth N40bn today.  Even though the rates might decline further tomorrow, we look forward to some stability next week.   


Having issued bills worth N40bn today, another N40bn worth will be issued next week with a view to controlling liquidity surge and put market rates at acceptable levels.   


The official exchange rate of the Naira as released by the CBN was 116.16/US$ as at May 21, 2008.


Michael Nkadi| Investment Research | UBA Global Markets | UBA House, 57 Marina Lagos Nigeria | 234-1-2800020 |

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