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

Collapsed banks in Ghana recovered only $142 million out of $2 billion loans, Bank of Ghana Governor reveals.

The Governor of the Bank of Ghana, Dr Ernest Addison says out of the $2 billion (GHS10.1 billion) worth of loans taken by the receivers of some nine banks which collapsed in the country, only $142 million (GHS731 million) has been received. The Governor of the Bank of Ghana (BoG), Dr Ernest Addison The nine banks were UT Bank, Capital Bank, Sovereign, Unibank, Construction Bank, The Royal Bank, Heritage Bank, Premium Bank and Beige Bank. According to him, the receivership process has been painstakingly slow with other loan defaulters and shareholders of the defunct banks engaging in frivolous legal cases to sabotage the process. “The process has progressed slowly as out of the total loans of $2 billion (GH¢10.1 billion) taken over by the Receivers, total recoveries so far is in excess of $142 million (GH₵ 731 million) and this has been achieved through loan repayments by customers; repayment of placements; sale of vehicles; liquidation of bonds; and from...
Post a Comment
Read more

How OPEC Agreed A 1.2Mbpd Production Cut

After months of wheeling and dealing, the member nations of the Organization of Petroleum Exporting Countries (OPEC) have finally agreed an average drop in production level of 1.2 million barrels per day, effective January. The agreement exempted Nigeria and Libya, but gave Iraq its first quotas since the 1990s, Bloomberg reports. Iran seems to be the greatest winner, as OPEC agreed for the country to raise output to about 3.8 million barrels a day as the country sought special treatment as it recovers from sanctions. However, Iraq OPEC’s second-largest producer, agreed to cut by 210,000 barrels a day from October levels despite its previous push for special consideration based on the urgency of its offensive against Islamic State. Saudi Arabia, which raised oil production to a record this year, will reduce output by 486,000 barrels a day to 10.058 million a day. The United Arab Emirates and Kuwait will reduce output by 139,000 barrels a day and 131,000 a day while ...
Post a Comment
Read more

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