Equities lose N46b as investors await CBN’s decisions

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LAGOS, SEPTEMBER 19, 2017 – Nigerian equities started this week on a downtrend as investors await the decisions of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN), which is scheduled to meet next week. Most price changes ended on the negative while volume of activities hovered around average at the Nigerian Stock Exchange (NSE).

Benchmark indices for the equities market ended the five-hour trading session with average day-on-day decline of 0.38 per cent, equivalent to net capital depreciation of N46 billion. The decline further moderated the average year-to-date return to 29.76 per cent.

Aggregate market value of all quoted equities at the NSE dropped from its opening value of N12.068 trillion to close at N12.022 trillion. The All Share Index (ASI)-the main price index for the equities market, declined from its index-on-board of 35,005.57 points to close at 34,873.07 points.

The decline was driven by profit-taking transactions and portfolio readjustments, especially within the oil and gas and consumer goods sectors. The NSE Oil & Gas Index declined by 3.0 per cent. The NSE Consumer Goods Index dropped by 1.2 per cent while the NSE Industrial Goods Index dipped by 0.8 per cent. However, the NSE Banking Index rose by 0.9 per cent while the NSE Insurance Index inched up by 0.2 per cent.

There were 18 losers against 14 gainers yesterday. Seplat Petroleum Development Company led the losers with a drop of N24.03 to close at N456.76. Nigerian Breweries followed with a loss of N5 to close at N170. Presco lost N2.49 to close at N58. Lafarge Africa dropped by 97 kobo to close at N49. Oando slipped by 30 kobo to close at N5.75. FBN Holdings dropped by 19 kobo to close at N5.41 while Access Bank lost 17 kobo to close at N9.73 per share.

On the upside, Guaranty Trust Bank led the gainers with a gain of N1 to close at N38. Cadbury Nigeria rose by 49 kobo to close at N11. Newrest ASL appreciated by 32 kobo to close at N6.82. Stanbic IBTC Holdings rose by 30 kobo to close at N39.50. Ecobank Transnational Incorporated added 20 kobo to close at N18 while Dangote Sugar Refinery chalked up 7.0 kobo to close at N13.72 per share.

Total turnover stood at 162.7 million shares valued at N1.5 billion. Access Bank was the most active stock with a turnover of 35.39 million shares valued at N354.24 million. Meyer Paints followed with 18.9 million shares worth N13.24 million while Fidelity Bank ranked third with 18.61 million shares worth N23.99 million.

Most analysts expected the apex bank, which will meet between Monday September 25 and Tuesday September 26, 2017, to retain its key rates. The apex bank is expected to retain the Monetary Policy Rate (MPR) at 14.0 per cent, the Cash Reserve Ratio at 22.5 per cent, Liquidity Ratio at 30.0 per cent and the asymmetric corridor around MPR at +200 and -500 basis points.

“Given our medium-term positive outlook on the equities market, the continuous downtrend in performance presents opportunities for investors who were unable to partake in the April-led rally; hence we expect to see an uptrend in market performance as investors source for bargains,” Afrinvest Securities stated in post-trading review.

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