Nigeria Market Report 09-10-2017

Are the bulls back? 

The NSE ASI recorded a 1.53% gain on Friday, lifting the Wtd return to 2.49%. Majorly, stocks positive gains throughout the week sustained the market index largely above the 35,000 levels. In our view, the positive equity market momentum was supported by the expectation of impressive 2017Q3 corporate scorecards, as macroeconomic woes wane gradually. The YTD gainimproved to 35.15%, with the broad market P/E and Dividend Yield ending at 11.5x and 3.9%, respectively. Market breadth closed positive (2.82x-Advance/Decliners ratio; 31 gainers Vs 11 losers) -signalling likely extended uptrend in the session today. Overall, we look forward to positive week ahead, amidst speculative positions undervalued stocks with strong fundamentals. 

A boost in activity level 

Market turnover appreciated by 31.19% on Friday, as investors maintained their preference for blue chips. A total of 367 million shares worth N3, 743 million exchanged hands for the day. AGLEVENT buoyed activities in the Conglomerate sector (representing 22% of sectoral trade). The top ten stocks constituted 80% of market turnover. 

PRESCO topped the gainer’s chart 

PRESCO firmed up on Friday, leading the gainers chart with a notable 9.77% gain. On the flip side, MRS topped the losers table, shedding 4.92%. Other top gainers for the day included NAHCO (+9.63%), WAPCO (+5.93%) and FBNK (+5.26). However, MRS (-4.98%), CUTIX (-4.92%), CCNN (-4.90%) and OANDO (-4.85%) were among the top losers for the day. 

Fixed income Market The bond market closed bearish on Friday as average yield gained 0.27% to 15.30% due to soft decrease in demand for local bond. Similarly, the Treasury bill market witnessed an increase in yield by 0.29% to 16.90%. The Open-Buy-Back and Overnight rates jumped to 25.83% and 26.00% from 7.50% and 7.92% respectively, which may not be unconnected with CBN’s N103bn OMO sale today. As at time of writing, today’s NIBOR rates were yet to be published.