Nigeria bourse sees buying interests in bellwethers spur N103bn investors’ gain

The Nigerian bourse extended its gains on Tuesday from the previous session as buying interests in bellwethers – Seplat Petroleum (+7.1%), Zenith Bank (+2.9%), and Access Bank (+5.1%) – drove the All-Share Index higher by 0.52 percent to 38,418.04 points. As a result, the market year to date loss improved to -4.6 percent while market capitalisation rose to N20 trillion from the N19.9 trillion recorded in the previous session.

Across the various sectors, performance was bullish as 4 of 6 indices closed in the green. The oil & gas and banking indices rose 4.9 percent and 3.3 percent, respectively, following buying interest in Seplat Petroleum (+7.1%), Total Nigeria (+9.2%), Zenith Bank (+2.9%), and Access Bank (+5.1%). Similarly, the Industrial and Consumer Goods indices inched higher by 0.1 percent apiece due to price appreciation in Wapco Plc (+1.4%), Flour Mills (+1.2%), and Vitafoam (+1.3%). Conversely, the insurance index was the lone laggard, down 0.3 percent on account of sell-offs in Linkage Assurance (-9.4%) and Wapic Plc (-5.1%). Finally, the ICT index closed flat.

As measured by the market breadth, the investors’ sentiment strengthened to 2.8x (from 1.7x) as 28 stocks gained while 10 stocks lost. May & Baker (+9.7%), UAC-Properties (+9.6%), and Total Nigeria (+9.2%) led gainers, while Eterna Plc (-9.7%), Linkage Assurance (-9.4%) and Unity Bank (-8.1%) led decliners.

Elsewhere, the NGX 30 Index increased by 0.61 percent to close at 1,617.18 points as against 1,607.39 points on the previous day. Market turnover closed with a traded volume of 156.20 million units. Total Nigeria and Seplat were the key gainers, while there were no losers.

FOREX Market

In the currency market, the naira depreciated by 0.08 percent as the dollar was quoted at N411.45 to the dollar as against the last close of N411.13 at the I&E FX market. However, at the parallel market the naira traded flat against the dollar at N502. Most market participants maintained bids of between N400 and N420.86 to  the dollar.

The Nigerian T-Bills secondary market closed on a mildly positive note with average yield across the curve decreasing by 3  basis points to close at 6.74 percent from 6.77 percent recorded the previous day. Average yield across the long-term maturities compressed by 5  basis points. However, the average yields across short-term and medium-term maturities closed flat at 4.34 percent and 5.46 percent, respectively. Buying interest was witnessed in the NTB 30-Jun-22 maturity bill with a yield decrease of 60 basis points, while yields on 21 bills remained unchanged.

In the OMO bills market, the average yield across the curve decreased by 2  basis points to close at 9.91 percent as against the last close of 9.93 percent. Mild buying interest was seen across short-term and long-term maturities with the average yields falling by 2  basis points and 3  basis points, respectively.

However, the average yield across the medium-term maturities closed flat at 9.92 percent. Yields on 8 bills compressed with the 22-Feb-22 maturity bill recording the highest yield decrease of 12  basis points, while yields on 16 bills remained unchanged.

The FGN bonds secondary market closed on a mildly positive note Tuesday as the average bond yield across the curve cleared lower by 8  basis points to close at 9.53 percent from 9.61 percent on the previous day. Average yield across the short tenor of the curve declined by 12  basis points, while the average yield across the medium tenor of the curve expanded by 7  basis points. However, the average yield across the long tenor of the curve remained unchanged.

The FGNSB 10-JUL-2022 Sukuk bond was the best performer with a decline in yield of 45  basis points, while the 17-MAR-2027 maturity bond was the worst performer with an increase in yield of 11  basis points. The secondary bond market is likely to remain subdued as investors await guidance for bond supply from the DMO’s quarterly bond auction calendar.