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Airtel, Nestle, FCMB Lift Stock Market Slightly This week

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Airtel, Nestle, FCMB Drag Stock Market Out of the Red Zone

Airtel Africa Plc led gainers with 9.97 percent to slightly dragged the Nigerian Stock Exchange out of the red zone this week.

The market capitalisation of listed equities expanded by 0.01 percent to close the week at N12.952 trillion. While the NSE All-Share Index gained 0.01 percent or 2.27 basis points from 24,826.75 bps achieved in the previous week to 24,829.02 bps this week.

The bourse year to date return moderated to -7.50 percent. However, the quarterly return remained at an impressive 16.57 percent even though the exchange returns a decline of -1.74 percent in June.

Activity level was low during the week as investors traded 738.375 million shares valued at N8.563 billion in 17,247 transactions. This was below the 1.050 billion shares worth N10.125 billion that were exchanged in 19.576 deals in the previous week.

In terms of volume traded, the financial services sector led the activity table with 456.851 million shares worth N3.773 billion exchanged in 8,062 deals. The sector contributed 61.92 percent and 44.06 percent to the total equity turnover volume and value, respectively.

This was followed by the consumer goods sector with 66.668 million shares valued at N2.015 billion but traded in 3,486 transactions.

The oil and gas industry came third with a total turnover of 63.255 million shares worth N380.146 million that were transacted in 963 deals.

In terms of the most traded stocks for the week, First Bank of Nigeria Holdings Plc, Guaranty Trust Bank Plc and Zenith Bank Plc led with a combined volume of 211.351 million shares valued at N3.042 billion that were exchanged in 3,623 deals. The three stocks contributed 28.59 percent and 35.52 percent to the total equity turnover volume and value, respectively.

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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.

Bonds

Buy Out African Bondholders With IMF Resources, AfDB Chief Says

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IMF global - Investors King

International Monetary Fund resources should be used to buy out holders of African bonds and avert a crisis as a global push for debt relief runs aground, the head of the continent’s biggest multilateral lender said.

Akinwumi Adesina, president of the African Development Bank, said the Common Framework — created by the Group of 20 leading economies to get private sector creditors involved in debt workouts alongside public lenders — is unlikely to be used again in its current state as countries fear ratings downgrades if they apply.

Yet many African nations are in desperate need of debt relief as they’ll struggle to meet huge repayments to investors in the coming years, Adesina said. To get the private sector on board, he proposed buying back foreign bonds with some of the $650 billion of reserve assets known as Special Drawing Rights that the IMF is planning to issue this year.

“Those bullet payments when they become due — and I don’t think Africa will be in a position to pay them — will really cause a major, major debt crisis down the line,” Adesina said in an interview with Bloomberg News in Paris. “We need to use some of the SDRs as a way of buying down some of that debt, but also conditionally asking the private sector to join the G-20 Common Framework.”

Read more: Paris Club Seizes Pandemic Opportunity to Reclaim Lost Influence

Adesina’s proposal comes as leaders gather in Paris for a conference hosted by France on the financing of African economies. The efforts of international lenders have so far focused on suspending debt-servicing costs, but that does little to address the size of the $700 billion debt pile or involve the private sector, which holds more than half of that debt.

The framework is available to 73 poor countries, but only Chad, Ethiopia and Zambia have so far requested it. In February, Fitch Ratings downgraded Ethiopia, saying its decision to request G-20 help raised the risk of default, while Moody’s has placed the country on review.

There are also doubts over whether the IMF’s SDR allocation alone can restore the finances of African nations, with Fitch saying in March it would not be enough to solve imbalances.

“The debt of Africa right now is too much, it’s like running up a hill with a backpack of sand,” Adesina said. “This issue is not going to go away unless we find a mechanism to buy down some of that private-sector debt.”

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Bonds

FMDQ Admits Mixta Real Estate Plc’s N960m Commercial Paper

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Mortgage - Investors King

FMDQ Securities Exchange Limited has approved the quotation of the N960 million Series 35 Mixta Real Estate Plc Commercial Paper (CP) under its N20 billion CP Issuance Programme on its platform.

The proceeds from this CP quotation will be used to finance Mixta Real Estate Plc’s short-term funding requirements.

Mixta Real Estate Plc, a subsidiary of Mixta Africa, is a real estate development company in Nigeria, with a strong track record and diverse real estate portfolio, and operations spanning the residential, commercial, and retail sectors of the Nigerian real estate industry.

It has successfully developed well over 5,000 properties spanning across affordable homes, luxury residences, and commercial projects, and continues to seek innovative solutions to activate development finance for affordable housing in Nigeria.

According to FMDQ, the quotation of the Mixta Real Estate Plc’s CP was a further testament to the exchange’s leadership and resilience in providing the required support to businesses, corporates and government entities through the delivery of innovative and value-adding capital market solutions.

“As part of efforts towards unlocking the potential of the Nigerian economy, FMDQ Exchange shall continue to support institutional growth and stimulate continuous development of the economy at large, through the provision of a world-class quotations service, in line with its mandate,” the exchange said.

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FMDQ Admits MTN, Coronation Merchant Bank’s Commercial Papers

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FMDQ Securities Exchange Limited has approved the quotation of the MTN Nigeria Communications Plc N19.77 billion Series 3 and N53.74 billion Series 4 Commercial Papers (CPs) under its N200 billion CP Issuance Programme.

The exchange also approved the quotation of the Coronation Merchant Bank Limited N0.71 billion Series 13 and N14.13 billion Series 14 Commercial Papers (CPs) in March 2021, and the N1.41 billion Series 15 and N20.19 billion Series 16 CPs in May 2021, under its N100 billion CP Programme.

Commenting on the development, the Chief Financial Officer, MTN Nigeria, Mr. Modupe Kadiri, said: “MTN Nigeria is very pleased with the success of our series 3 and Series 4 CP issuances, which further diversify our funding sources, help to optimise our finance cost and strengthen the Nigerian financial markets. The issuance was well received by the market, with strong participation from a diverse group of investors, signifying the market’s continued confidence in our business.

“By quoting these CPs on FMDQ Exchange, we are able to provide investors with a strong platform for liquidity and price discovery. Proceeds from the issuance will be deployed towards the company’s working capital and general corporate purposes.”

Also commenting on the completion of the CP quotation, the Managing Director/CEO, Coronation Merchant Bank Limited, Banjo Adegbohungbe, said: “we are delighted at the successful issuance and subsequent quotation of the Bank’s N0.71 billion Series 13 and N14.13 billion Series 14 CPs. This transaction further underscores the confidence of investors in our brand and entrenches our continuous leadership in the use of market instruments to create shared prosperity for all stakeholders.”

FMDQ said the timely admission of the CP issues, and in general, all securities on the exchange was a testament of the efficiency of the exchange’s securities quotation process.

“As is tradition for FMDQ Exchange, the Coronation Merchant Bank CPs, which were sponsored on the Exchange by Chapel Hill Denham Advisory Limited, a Registration Member (Quotation) of FMDQ Exchange, shall be availed global visibility through the Exchange’s website and systems, governance and continuous information disclosure to protect investors’ interest, credible price formation, amongst other benefits derived from the FMDQ Exchange platform,” it said.

According to the exchange, as part of its mandate to organise and govern markets within its purview, and promote credibility and transparency in the Nigerian debt capital market space, it shall continue provide an innovative and efficient platform targeted at supporting the aspirations of institutions and governments, and making the Nigerian financial markets globally competitive, operationally excellent, liquid and diverse.

FMDQ Group is Africa’s first vertically integrated financial market infrastructure group, strategically positioned to provide registration, listing & quotation services, seamless trading, clearing, settlement, risk management, and depository of financial market transactions, as well as data and information services, across the debt capital, foreign exchange, derivatives and equity markets, through its wholly owned subsidiaries.

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