The Market Today - 19 November 2018
Bourse gains 51bps despite weak market activity
Sustaining gains from the prior seesion, the ASI opened the week with a 51bps advance, majorly supported by strong gains in the Consumer Goods sector. Notably, the sector was the best performer on the day, gaining 137bps following upticks in NB (+266bps), NESTLE (+135bps) and DANGSUGAR (+117bps). While the Banking sector inched up 38bps, amid positive activity in ACCESS (+65bps) and ZENITHBANK (+42bps), the Industrial Goods sector closed flat for the day. The Oil & Gas sector was the sole loser, declining 14bps after a loss in FO (-777bps) outweighed gains in TOTAL (+20bps). We expect market to resume trading on a mildly positive note on Wednesday as bargain hunters continue to support buying activity. That said, given the still cautious sentiment in the market, we believe gains will remain modest across board.
Stock Watch: MBENEFIT is currently trading at its year-low of ₦0.23 after losing 800bps in today’s trading session. The stock has lost 54.00% YtD.
Uncertainty around MPC meeting to dampen market
Market liquidity improved to c.₦80 billion at the start of the week. Despite this, the interbank call rate advanced 384bps to close at 10.17%. Trading in the fixed income market turned mixed today, albeit with a positive tilt. In the treasury bills space, yields declined 1bp on average amidst both buy and sell interest across the curve. Likewise, trading in the bond space was slightly positive with yields on benchmark bonds declining 4bps on average. With investors keeping an eye on the bond auction as well as the MPC meeting (which holds on Wednesday and Thursday), we expect activity to remain tepid in the fixed income space. As a result of this, we do not foresee significant activity in Wednesday’s trading session
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