Gains in banking and industrial goods stocks lift market performance as investors smiled with N109.2bn profit

Charles Abuede

The Nigerian equities market rebounded from its previous day’s loss, buoyed by an upsurge in the banking sector largely influenced the market’s positive performance on Thursday; as a result, gains in GTBank (+6.4%), Zenith Bank (+7.3%) and Wapco (+2.7%) buoyed performance in the market today. Consequently, the benchmark index rose 0.54 per cent to 38,914.84 points, while the market year to date loss improved to -3.4 per cent and market capitalisation increased N109.2 billion to N20.4 trillion.

Also, trading activity level braced up as volume and value surged 727.8 per cent and 118.7 per cent respectively to 1.5 billion units and N5.9 billion. The most traded stocks by volume were Unity Bank (1.0bn units), Multiverse (200.2m units) and GTBank (122.2m units) while GTBank (N3.6bn), Zenith Bank(N711.9m) and Unity Bank (N700.7m) led by value.

Across the sectors, the performance was mixed as 3 indicators lost, 2 gained and the ICT index remained flat. The Insurance index led the losers, down 0.8 per cent following price declines in Wapic (-9.1%) and Linkage Assurance (-9.1%). Also, the Consumer goods and oil & gas indices dipped 0.2 per cent and 0.1 per cent respectively on the back of losses in Oando Plc (-3.0%), Dangote Sugar (-2.9%) and Honeywell Flour (-5.6%). Conversely, strong demand for GTBank (+6.4%), Zenith Bank (+7.3%) and Wapco (+2.7%) pushed the banking and industrial goods indices higher by 4.4 per cent and 0.2 per cent respectively.

Investor sentiment, as measured by market breadth strengthened to 1.8x from the 1.1x recorded previously as 22 stocks gained against 13 decliners. Eterna Plc (+10.0%), Lasaco Assurance (+8.3%) and Zenith Bank (+7.3%) were the top gainers while Wapic Plc (-9.1%), Linkage Assurance  (-9.1%) and ABC Transport Company (-6.7%) were the top decliners.

NSE 30

The NSE 30 Index increased by 0.69 per cent to close at 1,545.05 points as against 1,534.52 points as on the previous day. Market turnover closed with a traded volume of 203.40 million units. Zenith and Guaranty were the key gainers, while Sterling was the only loser.

FX Market

For the fourth session this week in the foreign exchange market, the Naira closed flat at N485 against the dollar in the parallel market and also stood unchanged at the official CBN window at N379 per dollar. Meanwhile, in the investors and exporters window, the local naira appreciated by 0.02 per cent or N0.08 as the dollar was quoted at N409.67 per U.S Dollar as against the last close of N409.75. Most market participants maintained bids between N394 and N412 per dollar.

Treasury Bills market

In the treasury bills segment of the fixed income market, the NT-Bills secondary market closed on a negative note with average yield across the curve increasing by 21 basis points to close at 3.34 per cent from 3.13 per cent on the previous day following selloffs across the short end of the market. The average yields across short-term and medium-term maturities widened by 46 basis points and 35 basis points, respectively. However, the average yield across long-term maturities closed flat at 4.43 per cent. Yields on 4 bills advanced with the 1-Jul-21 maturity bill recording the highest yield increase of 177 basis points, while yields on 15 bills remained unchanged.

Moreover, the bearish outcome trails the Primary Market Auction (PMA) conducted by the CBN on Wednesday where N2.5 billion, N5.9 billion, and N53.5 billion worth of bills were sold across the 91-day, 182-day, and 364-day instruments at 2.0 per cent, 3.5 per cent, and 7.0 per cent. As a result, only the stop rate on the 364-day tenor increased (previously: 6.5%), as investors cautiously played at the short end. The auction was oversubscribed by 148 per cent, with bid-to-cover ratios settling at 4.49x (91-day), 1.27x (182-day), and 2.68x (364-day).

In the OMO bills market, the average yield across the curve increased by 1 basis point to close at 6.96 per cent as against the last close of 6.95 per cent. Selling pressure was seen across short-term maturities with the average yield expanding by 3 basis points. However, the average yield across medium-term and long-term maturities closed flat at 6.95 per cent and 8.54 per cent, respectively. Yields on 4 bills advanced with the 30-Mar-21 maturity bill registering the highest yield increase of 13 bps, while yields on 23 bills remained unchanged.

Bond Market

In the Bond market, the bears continued to dominate, pushing yields 16 basis points higher to close at 6.13 per cent from 5.97 per cent on the previous day. Average yield across short tenor of the curve widened by 22 basis points, while the average yield across medium tenor and long tenor of the curve declined by 4 basis points and 2 basis points, respectively. The 23-MAR-2025 maturity bond was the best performer with a decline in yield of 155 basis points, while the FGNSB 19-JUN-2021 bond was the worst performer with an increase in yield of 120 basis points.