A positive close to the week
Nigerian shares edged higher on Friday as the NSE ASI gained a modest 0.19% to close at 36,646.46. This came amidst hopes of better returns on investment (36.36% Ytd) as results of companies that have been released so far show that though the previous year was a bit harsh for most businesses, they were able to scale through successfully with most of them having a better result than what was released in the comparative period.
International Breweries for example posted an increase of 7.22% in PAT while FO recorded an after-tax value of N1.04bn representing an increase of 7.22% over comparative period. We expect the elation of the “earning season” and the brighter macro picture to sustain the rally in the sessions ahead.
The broad market P/E and Dividend yield closed at 11.8x and 3.8% respectively
Market activity level depreciated
Aggregate value traded depreciated by 40.84% on Friday as investors exchanged 422 million shares worth N3.249 billion in 3,618 deals.
GUARANTY buoyed activities in the Financial Service sector, closing as the most active counter; and was the most traded stock, representing 15% of aggregate transaction size.
The top ten stocks constituted 86% of market turnover.
INTBREW topped the gainer’s chart
INTBREW closed atop the gainers’ table on Friday with a notable 7.25% gain. On the flipside, LEARNAFRICA shed 9.41% to lead the loser’s chart. Other top gainers for the day include FLOURMILLS (4.98%), DANGSUGAR (4.60%) and STANBIC (3.87%), while MOBIL, NAHCO and VITAFOAM tanked -5.20%, -4.93% and -4.64% accordingly.
Fixed income Market
Yields on the 5yr benchmark bond was flat at 16.37%, yield on the 7-year increased to 16.57% while the yield on the 10yr benchmark bonds declined by 7bps to 16.77%. Average T-bill rate closed the week at 18.55%, 7bps higher than the 18.48% recorded previously.
Liquidity mop up continued on Friday as the CBN sold N27bn worth of OMO bills at 17.95% and 18.55% stop rates. Consequently, the Open Buy Back and Overnight rates both increased by 250bps to 12.00% and 12.58% respectively.
Rates in the money market are likely to remain high in the sessions ahead on extended squeeze by the apex bank even as N101bn worth of OMO bills matures in the week.