Selloffs in BuaCem, Access, UBA push Nigeria bourse under waters

By Charles Abuede

Equities Trading

Stocks selloffs in BUA Cement, Access Bank, United Bank for Africa saw the Nigerian equities market maintain two-straight days of bearish performance with the NSE All-Share index falling slightly by seven basis points to close at 41,051.63 points in Tuesday trading session.

The big tickers, BUA Cement (-1.1%), Access Bank (-3.7%) and UBA (-2.2%), contributed to the year-to-date return drop to 1.9 per cent and a market capitalisation decline by N16.1 billion to settle at N21.5 trillion.

Activity level was mixed as volume traded fell 28.9 per cent to 525 million units while value traded rose 27.9 per cent to N5.3 billion. The most traded stocks by volume were Transnational Corporation (42.9 million units), Zenith Bank (28.5 million units), and BUA Cement (25.7 million units) while BUA Cement (N2 billion), Zenith Bank (N746 million), and GTBank (N348.8 million) topped by value.

Also, the performance across sectors was mixed as three indices lost, two gained and one closed flat. The insurance index sustained gains, advancing 6.3 per cent due to buying interest in Aiico Insurance (+9.9%), NEM Insurance (+10.0%) and Wapic Plc (+10.0%).

Similarly, the consumer goods index rose 0.6 per cent following price appreciation in Nigerian Breweries (+1.7%), Flour Mill (+3.2%), and PZ Cussons (+3.9%).

Conversely, the banking and oil & gas indices fell 0.7 per cent and 0.5 per cent respectively on the back of losses in Access Bank (-3.7%), UBA (-2.2%), Ardova Plc (-8.6%) and Oando Plc (-0.3%). Profit-taking in BUA Cement (-1.1%) dragged the industrial goods index lower by 0.2 per cent. Lastly, the AFR-ICT index closed flat.

There was a strengthening of the investor sentiment as measured by market breadth (advance/decline ratio) to 2.2x from the 1.7x recorded previously as 43 stocks advanced against 20 decliners. Wapic Plc (+10.0%), Afromedia (+10.0%) and NEM (+10.0%) were the best-performing tickers while Ardova Plc (-8.6%), Honey Flour (-8.3%) and FTN Cocoa (-8.3%) were the losers.

NSE 30

The NSE 30 Index marginally increased by 0.01 per cent to close at 1,684.99 points as against 1,684.82 points on the previous day. Market turnover closed with a traded volume of 172.68 million units. Flour Mills and Lafarge Africa were the key gainers, while Access and Sterling were the key losers.

Currency Trading

In the foreign exchange market, the naira traded flat from the previous day’s close at N475 per dollar in the street market. Also, at the I&E FX market, the naira appreciated further by 0.12 per cent as the dollar was quoted at N393.35 as against the last close of at N393.83. Most participants maintained bids of between N388 and N415.76 per dollar.

T-Bills Trading

In the Nigerian treasury bills market, it was a positive trading day with average yield across the curve decreasing by 8 basis points to close at 0.39 per cent from 0.48 per cent on the previous day. Average yields across short-term and long-term maturities fell by 13 basis points and 10 basis points, respectively, while the average yields across medium-term maturities remained unchanged at 0.41 per cent. However, maximum buying interest was seen in the NTB 13-Jan-22 (-102 bps) and NTB 15-Apr-21 (-76 bps) maturity bills.

In the OMO bills market, the average yield across the curve decreased by 42 basis points to close at 0.73 per cent from 1.15 per cent on the previous day. Buying interest was seen across short-term and long-term maturities with the average yields falling by one basis point and 87 basis points, respectively, while selling pressure was witnessed across medium-term maturities with the average yield rising by 8 basis points. Yields on 10 bills declined with the 28-Dec-21 maturity bill recording the highest yield decrease of 404 basis points, while yields on three bills advanced with the 8-Jun-21 maturity bill registering the highest yield increase of 24 basis points.

Bonds Trading

In the FGN bonds secondary market, it closed on a positive note as the average bond yield across the curve cleared lower by 15 basis points to close at 3.26 per cent from 3.41 per cent on the previous day. Average yields across short tenor and long tenor of the curve compressed by 16 basis points and 23 basis points respectively, while the average yield across medium tenor of the curve remained unchanged. The 26-APR-2049 maturity bond was the best performer with a decrease in the yield of 146 basis points, while the 18-JUL-2034 maturity bond was the worst performer with an increase in yield of 73 basis points.

Ahead of Wednesday’s N150 billion FGN bond auction by the DMO through the re-opening of 10-year, 15-year and 25-year tenors at N50 billion each with the settlement expected to be two days later (January 22), oversubscription is expected by investors who are likely to take advantage of the higher returns on the FGN bonds compared to the treasury bills.