Skip to main content

What to expect this week – #Stocks, #TreasuryBills, #FDI, #FPI





  • MPC raises interest rates by 200bps from 12% to 14%
  • The Naira started to see increased levels of volatility on the interbank market
  • CBN releases circular on Provisioning for Foreign Currency Loans
  • The US Fed keeps rates unchanged
  • Brent crude ends the week lower, just above $41 per barrel
Gains in mid-week saw Nigerian stocks end higher WoW, halting several weeks of declines. The market benchmark climbed 127bps WoW to close at 28,009.93pts, thus pairing the YtD decline to -221bps. Market capitalization also climbed N120.37bn to N9.62tnThe key driver of market performance being earnings release, which came in mixed. The 40% depreciation of the Naira impacted corporate earnings in varying degrees. Those long the US Dollar seeing significant FX gains impacting earnings positively while firms with foreign currency borrowings seeing earnings come under pressure.
Sector wise, the Banks led the way climbing 905bps on gains in ACCESS, GUARANTY & ZENITH – these largely on the anticipation that FX gains and trading income will boost earnings. On the hand, the Industrials were down 242bps on weakness in WAPCO & DANGCEM, which saw a dip in After-Tax earnings for H1’2016. The Consumers were also down 38bps while the Oils saw WoW declines of 516bps, on weakness in FO & SEPLAT in the earlier part of the week. However, gains in the downstream players at the end of the week following strong H1’2016 numbers tapered the losses.
Activity levels were higher for the week, with the bourse seeing a turnover of 1.87bn shares valued at N16.33 compared to the 1.35bn shares valued at N9.29bn that traded in the previous week. The action was driven by block trades in ZENITH, GUARANTY, UBA, FBNH & ACCESS. We note that participation involved both foreign and local investors.
A draft of H1’2016 were release last week, the numbers were mixed, with the likes of HONYFLOUR, DIAMONDBNK, NESTLE, TRANSCORP, FIDELITYBK, FBNH, DANGCEM, SEPLAT & 7UP all reporting lower After Tax Earnings while the likes of PRESCO, OKOMUOIL, FLOURMILLS, MOBIL & TOTAL  all seeing after tax earnings rise sharply.
The Week Ahead
  • Treasury Bills auction on Wednesday, we expect yields to climb higher driven by the MPC’s rate hike
  • The downstream oil marketers should be in focus on the NSE, given the impact of deregulation on their earnings.
  • Q2 2016 Capital Importation and FDI report is due from the NBS on Friday, 05 August
Source: FT.comMarket Snapshot
All-Share Index:
28,009.93pts
Market Cap (NGN):
N9.62tn
Market Cap (USD): @313/$
$30.73bn
Total Volumes Traded:
1.87bn
Total Value Traded (NGN):
N16.33bn
Daily Average Value Traded – WtD:
N3.27bn
Advance/Decline Ratio:
35/31
 Risers & Decliners:
  • Top Risers:
MRS (+21.45%; N38.78); GUARANTY (+14.36%; N24.05) & DANGFLOUR (+12.86%; N4.65)
  • Top Decliners:
SKYEBANK (-17.65%; N0.70); NEM (-12.00%; N0.88) & REDSTAREX (-10.57%; N4.23)
Source: FT.com



Join our BBM channel for instant updates : C0030863D

Comments

Post a Comment

Popular posts from this blog

BOOM: Nigeria’s External Reserves Drops To Lowest In 11 Years

Nigeria’s foreign exchange reserve fell to $25,780,765,483 (25.78 billion) as of August 16, the lowest we have seen since 2005. The drop was down 2.11% from a month ago. The Nations external reserves dropped below $26 billion for the first time on the 5th of August 2016 after it closed at about $25,971,610,949. In fact, the external reserves has dropped by about $480 million dollars in August alone compared to just $100 million in the whole of July. Ironically, the current balance of $25.9 billion is worth about 80% more than what it was in Naira following the depreciation of the naira after it was floated. The CBN has in the past few days ramped up sales of dollars at the interbank in the hope that it will create liquidity in a market that is yawning gape to swallow forex after nearly almost two years of intense rationing by the CBN. The Naira weakened to its lowest ever at the interbank after it closed at about N362.5/$1 in midday trading. The Naira will eventua...
Post a Comment
Read more

Why Entrepreneurs Should Engage Their Spouses in the Business

When her husband first joined a startup, a woman I’ll call Cindy had saved up a comfortable nest egg for her family. Even with several young children, their financial situation was stable enough that their personal risk in the venture seemed minimal. But a year later, when the seed funding dried out and no substantial revenue was forthcoming, things went downhill for them. Her husband stopped receiving a salary, yet continued working and traveling extensively for the company. Cindy had to care for their children, including two toddlers and two autistic preteens, mostly on her own. She begged her husband to find another job, but he didn’t want to leave a business that he had already invested so much in. She offered to go back to work and have him watch the kids; he refused. Within two years, their financial reserves and their children’s college funds had disappeared entirely. Their home was eventually foreclosed on, and the family had to move in with a relative. Onl...
Post a Comment
Read more

Emefiele gives insight, on what to Expect during his second term

The newly re-appointed Governor of the Central Bank of Nigeria, Godwin Emefiele, over the weekend enumerated the things intends to accomplish during his second term in office. Emefiele enumerated his plans while speaking to journalists at the University of Nigeria Nsukka (UNN), on the sidelines of the institution’s Special Convocation which took place on Friday. The CBN Governor gave delivered a lecture at the event. Driving down inflation: According to Emefiele, he intends to focus on policies that would drive down the country’s inflation rate, improve price stability, and drive economic growth. Emefiele’s Stern Warning: The CBN Governor further disclosed that he plans to work with his team to drive down imports and encourage exports. He also used the occasion to issue a stern warning to those who meddle with policies aimed at achieving economic stability, telling them that they will be caught and punished by law. Mr Emefiele’s second term plans came just a few days after ...
Post a Comment
Read more