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NSE LIVE! Investors strike N3.8bn deals on Sterling Bank as equities pare losses to N76bn

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NSE LIVE! Equities’ rally gathers momentum with N28bn gain

Investors struck N3.84 billion deals for the transfer of about 6.06 per cent equity stake in Sterling Bank Plc Thursday, raising speculations that some major shareholders might be divesting from the commercial bank.

Investors struck 108 deals for the exchange of 1.745 billion ordinary shares of 50 kobo each of Sterling Bank valued at M3.84 billion. The turnover volume represented 6.06 per cent of the total issued share capital of Sterling Bank. Sterling Bank currently has 28.79 billion ordinary shares outstanding at the Nigerian Stock Exchange (NSE).

The voluminous transactions in Sterling Bank led to 337 per cent increase in volume of activities at the Exchange as total turnover jumped to 2.22 billion shares valued at N7.5 billion in 5,468 deals.

Sterling Bank’s share price has risen by 106.5 per cent so far this year, making the stock one of the best performing stocks at the bullish Nigerian equities market. The NSE recently added Sterling Bank to the top index of 30 most capitalised stocks at the stock market.

Under the extant rules at the capital market, equity stake of 5.0 per cent and above is regarded as a major equity stake that must be reported to the regulatory authorities. Market analysts were however not certain about the identities of the investors behind the Sterling Bank’s deals.

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Long-standing Managing Director of Sterling Bank, Mr. Yemi Adeola, is scheduled to retire with effect from April 1, 2018, after 14 years of service on the board of the bank. Adeola will be succeeded by Mr. Abubakar Suleiman, currently the Executive Director, Finance & Strategy, a position he has held since May 2012.

The downtrend at the Nigerian equities market appeared to slow down yesterday as investors stepped up bargain-hunting for value stocks. Benchmark indices at the Exchange showed average decline of 0.49 per cent, equivalent to a net capital loss of N76 billion, the lowest decline in the four days of consecutive decline.

The All Share Index (ASI)-the value-based common index that tracks share prices at the Exchange declined from 43,538.16 points to close at 43,326.89 points. Aggregate market value of all quoted equities dropped from N15.624 trillion to close at N15.548 trillion. The average year-to-date return moderated to 13.29 per cent.

Most sectoral indices remained in the red, although the gap between losers and gainers narrowed considerably. The NSE Consumer Goods Index dropped by 2.0 per cent. The NSE Insurance Index declined by 0.6 per cent while the NSE Banking Index slipped by 0.1 per cent. On the upside, the NSE Industrial Goods Index rose by 0.3 per cent while the NSE Oil & Gas Index appreciated by 0.6 per cent.

There were 26 decliners against 17 advancers. Nestle Nigeria led the decliners with a loss of N72.20 to close at N1,372.80. Nigerian Breweries followed with a loss of N4.60 to close at N137.40. Stanbic IBTC Holdings declined by 30 kobo to close at N45.05. FBN Holdings and Union Bank of Nigeria dropped by 20 kobo each to close at N12.55 and N8.25. Nigerian Aviation Handling Company lost 19 kobo to close at N3.88 while Diamond Bank declined by 14 kobo to close at N2.76 per share.

On the upside, Forte Oil led the advancers with a gain of N2.25 to close at N48.20. International Breweries followed with a gain of N1.50 to close at N59. Dangote Cement rose by N1 to close at N265. Flour Mills of Nigeria added 80 kobo to close at N33. Cadbury Nigeria rose by 65 kobo to close at N15.50. Custodian and Allied chalked up 17 kobo to close at N4.17 while United Bank for Africa, United Capital, Unity Bank and Dangote Flour Mills rose by 15 kobo each to close at N12.35, N4.32, N1.75 and N16.15 respectively.

“The bearish sentiment in the equity market is likely to remain to end the week. However, we expect an increase in market activity, as the market moves from the oversold position in subsequent trading sessions with bargain hunting by investors,” FSDH Securities stated.

Analysts at Cordros Capital said they remained optimistic on the potential of equities to rise further.

“Whilst the bearish performance was in line with expectation, improving market breadth and turnover suggest some investors are taking advantage on the week-long sell off to buy into stocks with attractive valuation. Hence, we expect the ‘Buy the Dip” sentiment to buoy performance in subsequent sessions,” Afrinvest Securities stated.

 

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