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NSE ASI caps the year in green, ytd loss cut to 6.17%

What shaped the market today?

Equity Market

• The Nigerian equity market traded higher on the last trading day of the year with the NSE ASI up 34bps. Overall, the Index recorded a negative return of 6.17% for the year, marking the third straight yearly decline as all key sectors (save for the Banking sector) closed the year under water. On the global front, European and Asian bourses traded mostly lower in the final session of the year amidst relatively tepid market activity. However, the U.S. futures pointed to a higher open.
• The Consumer Goods sector (+210bps) was the sole gainer in today’s session following gains in NB (+435bps), GUINNESS (+422bps) and HONYFLOUR (+78bps). The Financial Services sector (-17bps) traded lower, cutting its year-to-date return to +217bps owing to losses across FBNH (+318bps), UBA (-153bps) and ZENITHBANK (-94bps). The Industrial Goods (-13bps) and Oil & Gas (-199bps) also dropped points no thanks to declines in PORTPAINT (-909bps) and FO (-974bps).
• Market breadth remained positive with 27 advances and 17 declines.

Fixed Income Market

• The fixed income market traded bullish with yields declining across the space as net liquidity inflow from OMO maturity continue to support demand.

What will shape the next trading session?

• We highlight that market could have closed lower barring the last minute surge in heavyweight NB and believe the NSE ASI could open the new year in the red given the relatively weak market sentiment.
• We anticipate a tepid trading session for the fixed income market at the start of the year as market participants look forward to the release of the Q1’17 auction calendar.