FREE

Weekly Market Wrap - 02 March 2018

NSE ASI ends the week marginally higher                                    

The Nigerian equity market rounded off the week on a mildly positive note, gaining 8bps on the day. Despite mixed closes through the week, the index ended the week with a positive return (+72bps w/w), thereby pulling ytd returns to 12%. Going into the new week, whilst we believe market sentiment will remain mixed, we expect more earnings releases to modestly dictate trading direction.                                  

Stock Watch: Amidst news that U.S. based private equity firm Milost Global Inc. is considering investing in UNITYBNK, buying interest has strengthened on the stock in recent sessions. UNITYBNK was the second highest gainer for the week (+19%) and currently trades at ₦1.77. The stock has returned 234% so far this year.                                      

Liquidity mop ups cap yield movements in FI market                                          

With the CBN holding off on OMO auctions at week open, the T-bills market began the week on a positive note. At midweek, the CBN conducted a Primary Market Auction, offering and selling ₦130 billion across the 91DTM, 182DTM and 364DTM bills at stop rates of 11.85%, 13.50% and 13.50% - lower than secondary market levels. Overall, yields in the T-bills market declined 10bps on average through the week. Meanwhile, yields on benchmark bonds were relatively flat w/w as activity waned in a week with few market catalysts.

The CBN continued its spate of regular interventions across different segments of the currency market this past week, with a notable $210 million injection at week open. Amidst these, the naira appreciated ₦0.61 at the I&E FX window and ₦0.10 at the CBN window to settle at ₦360.09 and ₦305.85 respectively w/w. We expect the CBN’s interventions will continue to sustain liquidity in the currency market.