TUE 05 JAN, 2021-theGBJournal- The naira strengthened by 0.1% to NGN393.83/USD at the Investors’ and Exporters’ (I&E) window and remained flat at NGN470.00/USD in the parallel market.
Analysts attribute the gains at the I&E window to the intervention by the Central Bank of Nigeria (CBN) at Monday’s trading session for local corporate only. Monday’s was at N394/$ against N410/$ of previous intervention.
The CBN was also expected to intervene today through provision of funds for SME, and PTA/BTA.
At the money market, the overnight lending rate declined by 50bps to 1.0%, as inflows for OMO maturities (NGN411.04 billion) came into the system.
Trading in the NTB secondary market was mixed, with a bearish tilt, as the average yield expanded slightly by 1bp to 0.5%. Across the curve, average yield expanded at the short (+6bps) end, following sell-off of the 9DTM (+12bps) instrument, and contracted at the mid (-4bps) segment due to demand for the 128DTM (-7bps) instrument; the long end was flat. At the OMO secondary market, average yield expanded by 5bps to 0.6%.
Trading in the Treasury bonds secondary market was also mixed, but with bullish bias, as the average yield pared by 1bp to 6.2%. Across the curve, average yield contracted at the mid (-2bps) segment, following buying interests in the MAR-2027 (-8bps) bond, but stayed flat at the short and long ends.
Meanwhile, the local bourse reversed the previous day’s gain, as profit-taking on bellwethers – BUACEMENT (-5.9%), MTNN (-2.8%) and ZENITHBANK (-4.3%) – triggered the first loss of the year. Precisely, the benchmark index declined by 1.8% to 40,396.14 points. Accordingly, Month-to-Date and Year-to-Date gains moderated to +0.3% apiece.
The total volume of trades increased by 119.7% to 465.67 million units, valued at NGN5.12 billion, and exchanged in 7,573 deals. TRANSCORP was the most traded stock by volume at 69.16 million units, while ZENITHBANK was the most traded stock by value at NGN788.33 million.
Sectoral performance was broadly negative, following declines across the Banking (-3.0%), Industrial Goods (-2.7%), Consumer Goods (-0.3%) and Oil & Gas (-0.03%) indices. The Insurance (+1.6%) index was the sole gainer in our coverage.
Market sentiment, as measured by market breadth, was negative (0.4x), as 34 tickers lost, relative to 15 gainers. OANDO (-10.0%) and FTNCOCOA (-9.7%) recorded the largest losses of the day, while BOCGAS (+9.7%) and NEM (+9.5%) topped the gainers’ list.
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