NSE RoundUp! Nigerian equities buck global uptrend with N41bn loss

Nigerian equities were among the contrarian as global equities rallied on the back of strong optimism on global economic outlook. Despite first quarter 2018 earnings reports by early filers including Nigeria’s two biggest banks-Guaranty Trust Bank and Zenith Bank, Nigerian equities closed the week on a negative, bucking a global rally in major advanced and emerging economies.

Nigeria’s benchmark equities index indicated average decline of 0.28 per cent in the immediate past week, equivalent to net capital depreciation of N41 billion. Market sentiment appeared to ignoresteady improvements in Nigerian corporate earnings and positive projection of the economy by the International Monetary Fund (IMF). IMF expects Nigerian growth to rise to 2.1 per cent in 2018 from 0.8 per cent in 2017. Crude oil price hit a three-year high of $73.82 per barrel during the week. 

The All Share Index (ASI)-the benchmark index of the Nigerian Stock Exchange (NSE) that serves as Nigeria’s sovereign equities index, declined from the week’s opening index of 40,928.70 points to close the week at 40,814.89 points. Aggregate market value of all quoted equities dropped correspondingly from the week’s opening value of N14.784 trillion to close at N14.743 trillion. Last week’s decline topped the average decline at the equities market so far this month to 1.66 per cent and depressed the average gain so far this year to 6.72 per cent.

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Conversely, most global equities markets closed the week on the positive side amidst global rally in commodities and strong optimism on world economic growth. In advanced markets, United States of America’s twin indices-S & P 500 Index and NASDAQ rose by 1.1 per cent and 1.4 per cent respectively. In United Kingdom, the FTSE All Share Index appreciated by 1.3 per cent. Japan’s Nikkei Index rose by 1.8 per cent. France’s CAC 40 Index rallied by 1.6 per cent. Germany’s XETRA DAX Index posted a gain of 0.6 per cent. Russia’s RTS Index rallied by 3.5 per centwhile Brazil’s Ibovespa Index rose by 1.6 per cent.

Most African markets also closed on the upside. South Africa’s JSE/FTSE All Share Index rose by 1.6 per cent. Ghana’s GSE Composite Index appreciated by 2.8 per cent while Egypt’s EGX Index recorded average return of 0.9 per cent. 

However, China led the major contrarian markets as the Shanghai Composite Index declined by 2.8 per cent. Hong Kong’s Hang Seng Index dropped by 1.3 per cent while Kenya’s NSE 20 Index dipped by 2.5 per cent. 

Meanwhile, the momentum of activities at the Nigerian stock market improved during the week. Total turnover for the week stood at 3.008 billion shares worth N30.296 billion in 24,036 deals compared with a total of 1.415 billion shares valued at N19.644 billion traded in 20,659 deals. Financial services sector led the activity chart with 2.539 billion shares valued at N23.510 billion traded in 13,179 deals; thus contributing 84.43 per cent and 77.60per cent to the total equity turnover volume and value respectively. The oil and gas sector followed with 273.443 million shares worth N2.358 billion in 3,735 deals while the consumer goods sector placed third with a turnover of 60.840 million shares worth N2.654 billion in 3,141 deals.

The three most active stocks were FCMB Group Plc, United Bank for Africa Plc and Oando Plc. The three most active jointly accounted for 1.816 billion shares worth N9.599 billion in 3,851 deals, contributing 60.37 per cent and 31.69 per cent to the total equity turnover volume and value respectively.

Also traded during the week were a total of 177,144 units of Exchange Traded Products (ETPs) valued at N2.809 million in sixdeals, compared with a total of 616,587 units valued at N9.185 million that was traded in 21 deals two weeks ago.

In the sovereign debt market, a total of 13,735 units of Federal Government bonds valued at N14.128 million were traded in 16 deals, compared with a total of 2,500 units valued at N2.367 million traded in 10 deals penultimate week.

There were 36 advancers to 33 decliners last week as against 37 advancers and 38 decliners recorded in the previous week. Most sectoral sectoral indices closed on the negative. The NSE 30 Indexdropped by 1.78 per cent. The NSE Banking Index declined by 1.25 per cent. The NSE Insurance Index dropped by 1.99 per cent. The NSE Consumer Goods Index dipped by 2.60 per cent while the NSE Industrial Goods Index declined by 0.89 per cent. However, the NSE Oil and Gas Index appreciated by 1.70 per cent. 

AG Leventis Nigeria led the decliners, in percentage terms, with a loss of 14.06 per cent to close at 55 kobo. 11 Plc-formerly Mobil Oil Nigeria, trailed with a drop of 14 per cent to close at N172 while Mutual Benefits Assurance declined by 12.12 per cent to close at 29kobo. 

On the upside, Oando led the advancers with a gain of 39.13 per cent to close at N9.60. Jaiz Bank followed with a gain of 21.13 per cent to close at 86 kobo while Skye Bank gathered 18.75 per cent to close at 95 kobo per share.

“Despite the weaker performance the equities market continues to record, activity level and investor sentiment improved week-on-week. Hence, we remain optimistic on a rebound in the near term. As first quarter 2018 earnings begin to trickle in, we anticipate improved sentiments in the market as investors would seek bargain hunting opportunities in fundamentally sound stocks with attractive entry prices,” Afrinvest Securities.

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