Weekly Market Update

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Bears Dominated Proceedings in the Equities Market Last Week…Investors lost N371.99bn

The local equities market closed on a negative note last week amid profit-taking across different tickers. The market opened the week with a 13bps declined followed by losses in all the remaining trading days of the week. Consequently, The All Share Index (ASI) declined by 1.66% WoW to settle at 41,709.09 with market capitalization adding N371.99bn to settle at N21.81tn.

Market breadth, a measure of Investors’ sentiment also declined from 1.21x to 0.54x as 22 stocks advanced while 41 stocks declined last week. MCNICHOLS(+43.14%), JAIZBANK(+10.77%) and ETERNA(+10.58%) were the top market gainers while LINKASSURE(-33.33%) JAPAULGOLD(-17.58%) and AIICO(-13.02%) top the losers’ chart.

Market activity level improved as both volume and value of transaction advanced by 7.67% and 6.47% . Trading in Union Bank of Nigeria Plc, First Bank Holding Plc and Transnational Corporation of Nigeria (measured by volume) accounted for 859.867 million shares worth N4.250 billion in 2,459 deals, contributing 31.08% and 14.32% to the total equity turnover volume and value respectively.

Outlook for the week

We expect to see some mixed activity this week as some investors hunt for bargains and others take profits with earnings release influencing decision

FIXED INCOME MARKETS

The Bond market reversed its bearish trend this week as market participants cherry picked across board following the sharp rise in yields witnessed in January. Bulk of the demand was seen on the mid to long end of the curve. However, towards the end of the week, we witnessed a kneejerk reaction on the last trading session of the week, following the significant spike in stop rate at the OMO auction. In all, average benchmark yields declined week-on-week by 9bps to 8.76% from 8.85% in the previous week.

Outlook for the week

We expect to see some bargain hunting activities as avenues for yield opportunities has been created on some maturities.

GLOBAL MARKETS

The US S&P 500 and Dow Jones indices both went up by 4.65% 3.89% following release of favorable economic data and latest development on the stimulus package. Similarly, other major indices closed positive with renewed upward trajectory of the Brent Crude oil price. Notably, the UK FTSE, German DAX and Japan NIKKEI went up by 1.28% 4.64% and 6.14% respectively

Outlook for the week

We expect positive performance this week as investors reacts to the stimulus package with positive outlook on global economy recovery.

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