Equities Gains N16bn, OTC FX Contract Matures

• Equities Gains N16bn, OTC FX Futures Contract Matures

The equities market appreciated slightly on Thursday by N16bn as the Nigerian Stock Exchange market capitalisation closed at N9.105tn from N9.089tn.

The NSE All-Share Index also rose to 26,464.82 basis points from 26,418.11 basis points as a total of 188.684 million shares worth N1.387bn exchanged hands in 3,161 deals.

The Nigerian bourse clung to a slim gain, halting a three-day downtrend largely on the back of a rally in the oil and gas sector.

The oil and gas sector snapped a five session losing streak to lead the pack in Thursday’s session, buoyed by firm gains in Forte Oil Plc, Conoil Plc and Oando Plc by 10.24 per cent, 10.20 per cent and 4.29 per cent, respectively.

Also, the industrial goods sector traded higher buoyed by advances in Beta Glass Plc and Cement Company of Northern Nigeria Plc by 10.21 per cent and 4.75 per cent, respectively.

The consumer goods sector closed relatively flat amid mixed performances across Guinness Nigeria Plc, Honeywell Flour Mill Plc and International Breweries Plc by 1.41 per cent, 4.65 per cent and 3.67 per cent, respectively.

The financial services sector slid further albeit marginally as declines in United Bank of Africa Plc and Guaranty Trust Bank Plc by 1.09 per cent and 0.56 per cent, accordingly, were watered down by gains in FBN Holdings Plc, FCMB Group Plc and Access Bank Plc.

Market breadth turned positive with 18 advances and 15 declines.

Meanwhile, the sixth OTC forex futures contract (NGUS Dec 21 2016), with notional amount of $477.45m, matured and was settled on December 21, 2016 on FMDQ OTC Securities Exchange.

This brings the total value of contracts so far matured on the OTC Exchange to circa $1.53bn, and about $5.02bn worth of OTC forex futures contracts traded so far.

The contract, which stopped trading on December 13, 2016, was valued against the Nigerian inter-bank foreign exchange fixing spot rate as published by FMDQ on December 21, 2016, with the associated clearing/settlement effected by the Nigeria Inter-Bank Settlement System Plc, in line with the FMDQ OTC forex futures market operational standards.

Consistent with its treatment for the previous five maturities (July – November 2016), the Central Bank of Nigeria introduced a new contract, NGUS DEC 27 2017, for $1.00bn at $/274.00 to replace the matured contract and refreshed its quotes on the existing 1 to 11-month contracts.

Market participants are hopeful that the efforts of the CBN, towards resuscitating the vibrancy of the nation’s forex market would, in the coming year, yield the desired results and invariably allow for the potential of the OTC forex futures market to be fully maximised by businesses, investors, governments, among others, with forex exposures.