EQUITIES MARKET

Selloffs in ACCESS (-1.6%), ZENITHBANK (-0.6%) and ETI (-2.3%) caused a modest 7bps decline in the Nigerian All Share Index to 24,269pts. Year to date return weakened to -9.6%. Activity levels strengthened as 305.1mn shares (+90.1%) valued at ₦2.01bn (+42.6%) were traded in 3,258 deals. Top volume performers are SOVERENINS (75.6mn), UBA (70.7mn) and GUARANTY (36.9mn). Top traded stocks by value are GUARANTY (₦795.1mn), UBA (₦441.9mn) & NB (₦230.9mn).

SECTORAL PERFORMANCE

Two sectors gained - Insurance (+0.4%) & Oil & Gas (+0.3%) while Industrial (-0.5%) and Banking (-0.3%) lost. Consumer Goods closed flat.

INVESTORS SENTIMENT

Market breadth was flat with 12 gainers and 13 losers. GLAXOSMITHKLINE (+9.5%), FIDSON (+9.4%) & LINKASSURE (+9.4%) led the gainers while NEIMETH (-10.0%), CUTIX (-9.9%) & CHAMS (-4.3%) led the losers.

MARKET INSIGHT AND OPPORTUNITIES

ACCESS (-1.61%) announcedd its successful acquisition of Transnational Bank Plc in Kenya. UNILEVER reported a steep decline in its half year revenue (-40.1%) to ₦14bn while bottomline recorded a loss before tax of -₦1.5bn down 156% from a Q2 2019 profit of ₦2.7bn.

As results trickle in, we expect investors to react adversely to negative performance of listed stocks. However, we expect the telecommunication sector (MTNN and AIRTELAFRI) to outperform the market by earnings performance. We also expect revaluation gains from devaluation and interest income on foreign currency loans to neutralise possible impairments on non performing loans of banks that have net dollar surplus positions.

FOREIGN EXCHANGE MARKET

The Naira closed flat at ₦388.5/$ in the I&E FX Window today with trades within the ₦380.0 - ₦390.5 trading band. Total turnover amounted to $37.0mn.

MONEY MARKET

The Overnight lending and Open Buy Back rates fell to 10.7% and 9.2% respectively.

FIXED INCOME MARKET

Selloffs raised yields by 1bp, 1bp and 4bps in the OMO, treasury bill and treasury bond markets respectively.