Report

Weekly Market Wrap - 23 November 2018

Bourse records a 98bp loss to end the week                                                      

Trading in the equity market ended on a negative note this week, with the ASI recording a 98bps d/d and 118 bps w/w loss. Though marginal, the Banking sector (d/d: +28bps; w/w:-75bps) emerged as the sole sector gainer on the day, after gains in  ETI (d/d: +161bps) and GUARANTY (d/d: +111bps) netted off a decline in ZENITHBANK (d/d: -62bps). Meanwhile, the Industrial Goods sector (d/d: -278bps; w/w:-528bps) extended its losses at week close following major losses in DANGCEM (d/d: -250bps; w/w: -418bps) and WAPCO (d/d: -667bps; w/w: -12.50%). While the Consumer Goods (d/d: -60bps; w/w: -108bps) and Oil & Gas sectors (d/d: -25bps; w/w:+25bps) also closed in the red d/d, both sectors recorded marginal gains w/w supported by earlier gains in the week - FLOURMILL (w/w: +10.00%) and MOBIL (w/w: +10.00%). We expect another negative trading session as investor apathy continues to weigh on market activity at week open.                               

Stock Watch: ACCESS lost in three out of four sessions this week. The Tier I banking stock lost 199bps d/d to settle at a year low of ₦7.40. The stock currently trades at a YTD loss of 29.19%.                                  

Positive sentiment across the fixed income market                                                       

Supported by a net OMO maturity of c.₦80 billion on Thursday, system liquidity was mostly healthy through the week (Friday estimate–c.₦388 billion), driving a 50bps w/w drop in the Interbank Call rate to 5.83% on Friday. Meanwile, trading was mostly positive in the T-bills space this week, with yields declining 10bps w/w (-6bps d/d), supported by decent liquidity. Likewise, trading in the bond space was positive, with yields on benchmark bonds declining 6bps w/w (2bps d/d). This was largely anticipated as many investors missed out at Wednesday’s bond auction, with allotment lagging subscription by ₦63 billion. We anticipate a quiet start to next week’s trading, with a bit of buying in the bond space. We expect investors who went short in anticipation of a rate hike from the MPC re-enter the bond market to cover their positions  

Underlying
Access Bank

Provider
Vetiva Capital Management
Vetiva Capital Management

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