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Equities Lose N144b Ahead of MPC Decisions



Egypt Stocks
  • Equities Lose N144b as Investors Await CBN Decisions

Investors scrambled to realign their portfolios and lock in profit ahead of the meeting of the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN). A midweek selling spree left the equities market with a net capital depreciation of N143.9 billion last week as investors anxiously await the decisions of the MPC.

The MPC is scheduled to meet between today and tomorrow during which the apex bank will review its monetary policy tools and rates, in the light of current macro-economic and global outlook. While many analysts expected the apex bank to retain its current rates, some analysts said improving macro-economic performance, though still fragile, could encourage the apex bank to cut rates.

With more than two losers to every gainer, quoted equities on the Nigerian Stock Exchange (NSE) traded largely on the negative during the week. The All Share Index (ASI)-the benchmark index that tracks share prices at the Exchange, recorded a week-on-week decline of 1.12 per cent to close the week at 36,703.58 points as against its week’s opening index of 37,120.28 points.

Aggregate market value of all quoted equities also dropped from its week’s opening value of N12.847 trillion to close at N12.774 trillion. The difference between the ASI and aggregate market value was due to the listing of new shares by two companies-Unilever Nigeria and Trans-Nationwide Express. All other sectoral indices also closed negative with the exception of the NSE Oil and Gas Index, which appreciated by 0.85 per cent. Average year-to-date return depressed to 36.57 per cent.

Total turnover stood at 2.80 billion shares worth N54.78 billion in 17,792 deals last week as against a total of 1.32 billion shares valued at N13.78 billion traded in 19,169 deals two weeks ago. Financial services sector remained atop activity chart with 2.352 billion shares valued at N8.995 billion traded in 9,364 deals; thus contributing 83.88 per cent and 16.42 per cent to the total equity turnover volume and value respectively. The consumer goods sector followed with 178.982 million shares worth N16.849 billion in 4,297 deals while the third place was occupied by industrial goods sector with a turnover of 140.570 million shares worth N27.848 billion in 794 deals.

The three most active stocks were Sovereign Trust Insurance Plc, FBN Holdings Plc and Dangote Cement Plc, which altogether accounted for 1.917 billion shares worth N29.875 billion in 2,130 deals, contributing 68.37 per cent and 54.54 per cent to the total equity turnover volume and value respectively.

In the sovereign debt market, a total of 5,950 units of Federal Government Bonds valued at N6.247 million were traded in two deals, compared with a total of 2,806 units valued at N2.623 million traded in 16 deals penultimate week.

Sectoral indices showed a market-wide sell pressure. The NSE 30 Index, which tracks the 30 most capitalised stocks at the NSE, recorded a week-on-week decline of 1.37 per cent. The NSE Consumer Goods Index recorded the highest loss of 2.89 per cent. The NSE Banking Index depreciated by 1.29 per cent. The NSE Insurance Index dipped by 1.98 per cent while the NSE Industrial Goods Index declined by 1.03 per cent.

There were 20 gainers against 43 losers last week as against 30 gainers and 29 losers recorded in the previous week. AG Leventis Nigeria recorded the highest gain, in percentage terms, of 27.3 per cent to close at 70 kobo. Forte Oil followed with a gain of 10.3 per cent to close at N48.62 while BOC Gases rose by 9.9 per cent to close at N4.56 per share. On the other hand, Caverton Offshore Support Group recorded the highest loss of 21.4 per cent to close at N1.32. Linkage Assurance dropped by 17.7 per cent to close at 56 kobo while C & I Leasing declined by 13.8 per cent to close at N1.44 per share.

“Despite the noticeable easing of external sector pressures and improving growth prospect, we believe that in line with outcomes of previous meetings held this year, the MPC would retain rates at current level, owing to the fragility of the economic recovery and disappointing inflation numbers witnessed so far in third quarter 2017,” Afrinvest Securities stated.

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


Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth



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




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




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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