Sell-offs in Airtel, DangCem and Zenith Bank results in N301bn loss for investors

Charles Abuede

The resurfacing of the bears on Wednesday brought about a N301 billion loss to market investors. The local bourse extended the previous sessions’ negative performance as the All-Share Index fell by 1.48 per cent to close at 38,446.09 points due to sell-offs in Airtel Africa (-10.0%), Dangote Cement (-0.5%), and Zenith Bank (-2.1%). Consequently, the market year to date loss worsened to -4.5 per cent as market capitalisation declined to N20.04 trillion.

The level of trading activity was mixed as volume traded declined by 24.9 per cent to 153.6 million units while value traded increased by 32.9 per cent to 2.4 billion. The most traded stocks by volume were UAC Nigeria (10.0m units), Zenith Bank (9.6m units), and Fidelity Bank (8.7m units) while Seplat petroleum (N1.1bn), Zenith Bank (N222.8m), and Wapco Plc (N111.8m) led by value.

Performance was bearish across sectors as 4 indicators lost while 2 gained. The ICT index led the laggards, down 5.2 per cent due to selling pressure on Airtel Africa (-10.0%). In the same vein, the banking and insurance indices fell by 0.6 per cent apiece mainly due to price depreciation in Zenith Bank (-2.1%), GTBank (-0.5%), Custodian Plc (-2.5%), and AIICO Insurance(-3.1%).

Similarly, the consumer goods index also lost, down 32 basis points following sell-offs in Dangote Sugar (-3.9%), and International Breweries (-0.9%). Alternatively, the oil & gas and industrial goods indices rose by 7.1 per cent and 0.9 per cent respectively as a result of buying interest in Seplat Petroleum (+10.0%), MRS (+10.0%), and Dangote Cement  (+0.5%).

On the other hand, investor sentiment strengthened to 0.9x from the 0.7x recorded in the previous trading session as 23 stocks gained while 25 lost. Seplat Petroleum (+10.0%), MRS (+10.0%), and Sterling Bank (+9.7%) led gainers while Airtel Africa (-10.0%), C&I Leasing (-10.0%), and BOC Gas (-10.0%) led decliners.

NSE 30

Elsewhere, the NSE 30 Index on Wednesday increased by 0.39 per cent to close at 1,562.01 points as against 1,555.92 points as on the previous day. Market turnover closed with a traded volume of 66.18 million units. Seplat and Sterling were the key gainers, while Dangote Sugar and Ecobank were the key losers.

FX market

In the foreign exchange market, Naira appreciated by 0.21 per cent as the dollar was quoted at N410.75 as against the last close of N411.63 at the I&E FX market. Most participants maintained bids between N401.10 and N420.92 per dollar.

Treasury Bills

The NT-Bills secondary market closed on a negative note with the average yield across the curve increasing by 9 basis points to close at 5.50 per cent from 5.41 per cent on the previous day. Average yields across short-term and medium-term maturities expanded by 9 basis points and 21 basis points, respectively, while the average yield across long-term maturities remained unchanged at 7.36 per cent. Yields on 7 bills advanced with the 26-Aug-21 maturity bill recording the highest yield increase of 46 basis points, while yields on 13 bills remained unchanged.

Further, into the OMO bills market, the average yield across the curve increased by 10 basis points to close at 9.24 per cent as against the last close of 9.14 per cent. Selling pressure was seen across medium-term and long-term maturities with average yields rising by 17 basis points and 9 basis points, respectively. However, the average yield across short-term maturities remained unchanged at 7.69 per cent. The yields on 8 bills advanced with the 16-Nov-21 maturity bill recording the highest yield increase of 64 basis points, while yields on 17 bills remained unchanged.

Bonds market

The FGN bonds secondary market closed mildly negative as the average bond yield across the curve cleared higher by 3 basis points to close at 9.38 per cent from 9.35 per cent on the previous day. Average yield across the short tenor widened by 4  basis points, while the average yields across medium tenor and long tenor of the curve remained unchanged. The FGN Sovereign Bond 15-MAY-2022 was the best performer with a decline in yield of 2 basis points, while the FGN Sovereign Bond 16-AUG-2021 was the worst performer with an increase in yield of 41 basis points.

Meanwhile, on Wednesday,  the debt management office conducted its scheduled FGN bond auction to reopen the 10-year, 15-year, and 30-year instruments. A total of N150 billion was offered across 10-year (N50 billion), 15-year (N50 billion), and 30-year (N50 billion) tenors. The bond settlement will take place on May 21,

2021.