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Equities Rebound After five-day Losing Streak

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  • Equities Rebound After five-day Losing Streak

The Nigerian equities market rebounded from a five-day losing streak on Wednesday as the All-Share Index rose by 0.6 per cent to close at 35,609.07 basis points.

The year-to-date return advanced to 32.5 per cent as 281.836 million shares worth N5.424bn exchanged hands in 4,066 deals.

Investors gained N70.7bn as the Nigerian Stock Exchange market capitalisation settled at N12.3tn.

“The major drivers were Dangote Cement Plc, Zenith Bank Plc, Nigerian Breweries Plc and Guinness Nigeria Plc, which respectively appreciated by one per cent, 2.9 per cent, 1.4 per cent and 10.2 per cent,” analysts at Afrinvest Securities said in a post.

Similarly, to activity level improved as volume and value traded rose by 22.5 per cent and by 13.6 per cent to 281.8 million units and N5.4bn, respectively.

The sector performances were mixed as three of five indices closed positive. The oil/gas index led sector gainers, up by 1.3 per cent as a result of bargain-hunting in Seplat Petroleum Development Company Plc, which appreciated by 3.4 per cent.

In the same vein, buy interests in Nigerian Breweries, Guinness, Zenith Bank and Stanbic IBTC Holdings Plc buoyed the consumer goods and banking indices by 0.8 per cent and 0.1 per cent, respectively.

However, despite an uptick in Dangote Cement by one per cent, the industrial goods index closed 0.5 per cent lower due to losses in Lafarge Africa Plc, which declined by 2.5 per cent.

Likewise, the insurance index fell by 0.4 per cent on account of price depreciation in Custodian and Allied Plc and Linkage Assurance Plc, which depreciated by 2.8 per cent and 4.5 per cent.

Investor sentiment remained soft as market breadth stayed flat after 22 stocks advanced against 23 decliners.

“While Wednesday’s performance comes in positive, the relatively soft market breadth suggests investors are still taking profit. Hence, we are of the view that the equities market may trade sideways in the short term,” the Afrinvest analysts added.

Meanwhile, the open buy-back and overnight rates closed lower at 10.33 per cent and 11 per cent, respectively at the end of trading on Wednesday, reflecting declines of 1.84 per cent and 1.67 per cent accordingly. Consequently, average money market rate settled at 10.67 per cent.

Contrary to Tuesday, bullish sentiments dominated the treasury bills space at the close of trading, as the average reasury bills yield declined by 1.29 per cent to close at 18.87 per cent. Yield declines were recorded on all tenors.

In line with the performance in the treasury bills space; buy pressures prevailed in the treasury bonds market as 12 instruments declined, while all others traded flat. The average bond yield pared by 12 basis points to settle at 15.74 per cent. The May-2018 bond was the most attractive, as it recorded a 0.61 per cent yield decline.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

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Godwin Emefile

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

The Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has pledged to adopt accommodative monetary policy stance in 2021 in order to support economic growth in the country.

Emefiele, said this on Friday, while speaking at a CBN/Bankers’ Committee’s initiative for economic growth, which is a one-day special summit on the economy by bank chief executive officers.

The theme of the summit is: “How to Overcome the Pitfalls of Recession.”

Nigeria’s economy recently came out of recession, according to the Gross Domestic Product report for fourth quarter 2020 released by the National Bureau of Statistics.

Owing to the slump GDP growth of 0.11 per cent that lifted the economy out of recession, Emefiele said it was imperative that, “we do all we can in 2021 and beyond to ensure that we build on the positive momentum and strengthen our efforts at stimulating growth.”

He expressed optimism that with the discovery and deployment of vaccines worldwide, 2021 would be a year of massive global recovery and Nigeria must not be left out.

“The banks CEOs are here, whether by moral suasion or by force, they will have to participate in this journey. In order to drive and sustain this recovery therefore, we need to sustain the accommodative fiscal and monetary policy measures aimed at improving access to finance for households and businesses.

“Secondly, we must prevent a resurgence in Covid-19 related cases. Thirdly, we must ensure that a significant number of our population is significantly vaccinated and also improve foreign exchange inflows into our country,” he added.

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Banking Sector

CIT Microfinance Bank Disburses Over N16bn Loans

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CIT Microfinance Bank Disburses Over N16bn Loans

CIT Microfinance Bank Limited says it has disbursed about N16bn loans since it commenced operations as part of its contributions to the financial sector and empowerment of businesses.

The Managing Director of the microfinance bank, Mr Kingsley Eremionkhale, disclosed this during the company’s 10th anniversary in Lagos recently.

He reiterated that the bank was committed to supporting the growth of small and medium-scale enterprises in the country.

“Since inception, we have disbursed loans worth about N16bn. Our operation is not just about profit-making, but we have impacted many lives, empowered many businesses, and done a lot in terms of our core mandate as a microfinance bank.”

While appreciating its customers who had been loyal to it for years, he said it was concerned about their business success.

The managing director said, “We are part of our customers’ businesses. We provide services beyond lending and savings products and we also give financial advisory services.”

He appreciated the customers who had stayed with the financial institution for many years.

The managing director noted that the MfB is a state-licensed bank operating in Lagos, and a subsidiary of Capitalfield Investment Group.

He also attributed the success of the MfB to the board of directors which it said had been supportive, the management team and its workforce in the past 10 years.

While saying that the bank could lay claims to exponential growth, he said the public should expect more from it.

He also said that it was driving its operations through its digital offerings and our e-channels, to improve its services to our customers.

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Finance

FMDQ Approves Valency Agro’s N5.12bn Commercial Paper

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FMDQ

FMDQ Approves Valency Agro’s N5.12bn Commercial Paper

FMDQ Securities Exchange Limited has announced the approval of the quotation of the Valency Agro Nigeria Limited N5.12bn Series 1 Commercial Paper under its N20bn CP Programme on its platform.

The Exchange said in fostering the development of the Nigerian debt capital markets, it had continued to avail its credible and efficient platform as well as tailor its listings and quotations services to suit the needs of issuers and registration members through innovative and uninterrupted service delivery.

It said in a statement on Thursday that the Valency Agro Nigeria CP debut issue came at a time when the Nigerian economy was bedeviled with soaring food prices, amidst compounding challenges of insecurity.

It said the agricultural sector and its attendant transformation agenda had never been more important in driving increased and sustainable production of agricultural products as well as the derived foreign earnings through exports.

The Exchange said the proceeds from the issue of the CP would be applied by Valency Agro towards meeting the mid-term working capital requirements of the various agricultural produce under its portfolio such as cashew, sesame, cocoa and in value addition prior to export.

The Executive Director, Valency Agro Nigeria Limited, Mr Sumit Jain, was quoted as saying, “We are thankful to our investors towards showing their faith in our agenda to grow the agriculture-focused business with a clear aim to maximise value addition and create employment opportunities in Nigeria.

“We would also like to commend the efforts made by FBNQuest Merchant Bank Limited’s team to build the reach and FMDQ for their unconditional support for the industry”.

The Head, Capital Markets, FBNQuest Merchant Bank, Mr Oluseun Olatidoye, said, “FBNQuest Merchant Bank Limited is delighted with the successful debut of the N5.12bn Series 1 CP issued by Valency Agro Nigeria Limited. This reiterates our effort to enable underserved sectors access the debt markets, optimise their capital structure and further deepen the domestic capital markets.

“We are proud of the instrumental role FBNQuest Merchant Bank played in this transaction and appreciate the trust the management of Valency Agro placed in us to assist them. Our clients remain our priority, and we strongly believe their success is our success.”

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