Weekly Market Wrap - 27 April 2018
Consumer Goods save the day as week closes in the green
The Nigerian equity market closed out the week on a bright note, climbing 115bps today to notch a 105bps w/w gain. Market sentiment at the end of the week was largely positive – evidenced by markedly positive market breadth and a strong green close. We expect this to lift the ASI at the start of the coming ahead.
Stock Watch: JBERGER released its Q1’18 results today, reporting Revenue of ₦35 billion (+3% y/y), 7% below our estimate and PAT of ₦1.5 billion (Q1’17: ₦420 million LAT) – 94% above our estimates. The stock gained 487bps today to close at ₦26.90 and has lost 4% ytd.
Mixed sentiment as yield moderation slows down
Strong buying momentum observed earlier in the week tapered off towards the end of the week, though yields still declined 15bps on average in the T-bills space and advanced 2bps on average on benchmark bonds. Sentiment in the T-bills space remained mixed today with yields advancing 3bps on average in the space. Trading in the bond market was more negative as yields on benchmark bonds advanced 7bps on average on the day. We expect a pause on OMO auction at the start of the coming week. Hence, we expect buoyant liquidity to offer some support to system liquidity and consequently demand for fixed income securities.
The CBN continued to intervene in the Foreign Exchange market, notably selling $210 million at week open across various segments of the market. With this, the naira appreciated ₦0.01 w/w at the I&E FX Window to close at ₦360.41 while remaining flat in the parallel market at ₦361.50. We expect the naira to remain stable across the various windows of the currency space with the CBN’s continued interventions in the FX market.
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