Finance

Equities Market Gains 3.9% as Investors Renew Buying Interest

Published

5 years ago

January 21, 2019

Nigerian Exchange Limited - Investors King

Equities Market Gains 3.9% as Investors Renew Buying Interest

The stock market made an unexpected recovery last week as investors embarked on bargain hunting in stocks perceived to have attractive valuation. After falling 17.8 per cent last year the market had opened the New Year on bearish note due to weak demand for stocks ahead of the general elections. However, some discerning investors decided to take advantage of prices of some stocks that had hit record lows.

Hence, the return of the bulls to the market leading to seven days of gain.

Consequently, the Nigerian Stock Exchange (NSE) All-Share Index (ASI) appreciated 3.9 per cent last week to close at 31,005.17, while market capitalisation ended higher at N11.562 trillion.

Similarly, all other indices finished higher with the exception of the NSE Banking Index that depreciated by 1.04 per cent while the NSE ASeM index closed flat.

The NSE Industrial Goods Index led with 12.7 per cent gain, followed by the NSE Insurance Index with 5.5 per cent, while NSE Consumer Goods Index and NSE Oil & Gas Index went up by 2.7 per cent and 0.59 per cent in that order.

However, commenting on the market performance, analysts at Cordros Capital Limited said: “In spite of this week’s rally, our view continues to favour cautious trading pattern in the equities market amidst brewing political jitters ahead 2019 elections, and the absence of a positive market trigger. However, we the positive macroeconomic fundamentals to drive recovery in the long-term.

Daily Performance

The Chief Executive Officer of the NSE, Mr. Oscar Onyema, had on Monday, explained why the market declined last year. He had said it was the trend globally as most emerging and frontier markets closed weaker. He noted that in Nigeria, the market would remain volatile in the first half (H1) of 2019 before it will recover in second half (H2).

“Accordingly, we anticipate volatility in equities market in H1 in 2019 with enhanced stability post-elections. We believe swift approval and implementation of the 2019 budget may have a positive impact on the companies’ earnings as well as consumer spending. Therefore, we anticipate a return of listings during the year with an uptick in market activity during the H2 of 2019,” Onyema said.

Also, last Tuesday, the market the maintained bullish trend with the NSE ASI rising 0.4 per cent to close at 30,583.21, while market capitalisation added N45.7 billion to close at N11.4 trillion.

The renewed demand has continued to boost prices of stocks. And buying interests in Dangote Cement Plc, Nigerian Breweries Plc among other bellwethers influenced the positive performance on that day.

But Neimeth International Pharmaceuticals Plc led the price gainers’ chart with 9.4 per cent, trailed by NEM Insurance Plc with 9.7 per cent. Sovereign Trust Insurance Plc went up by 9.0 per cent, while Royal Exchange Plc and Jaiz Bank Plc chalked up 8.3 per cent and 8.0 per cent respectively.

PZ Cussons Nigeria Plc, Union Diagnostic & Clinical Services Plc and Wema Bank Plc garnered 7.7 per cent, 7.4 per cent and 5.1 per cent in that order. Cement Company of Northern Nigeria Plc and Forte Oil Plc appreciated by 4.5 per cent and 2.5 per cent respectively.

Conversely, Etranzact Plc led the price losers with 9.8 per cent, trailed by Resort Savings and Loans Plc with 9.6 per cent, just as Cornerstone Insurance Plc shed 9.0 per cent. NPF Microfinance Bank Plc went down by 8.1 per cent, while First Aluminium and AXA Mansard Insurance Plc depreciated by 6.0 per cent and 4.6 per cent in that order.

By Wednesday, the market had recovered N235 billion in three days following gains recorded by bellwether stocks. The market capitalisation rose from N11.124 trillion to N11.329 trillion in three days, while the NSE ASI rose 2.1 per cent from 29,830.70 to close at 30,460.68 in the three days.

However, on Wednesday alone, accounted for 1.07 per cent bolstered by gains in bellwether counters such as Guinness Nigeria Plc, Forte Oil Plc, Dangote Cement Plc and United Bank for Africa Plc among others.

A total of 24 stocks appreciated compared with 16 others that depreciated. Sovereign Trust Insurance Plc and Veritas Kapital Assurance Plc led the price gainers with 10 per cent apiece. Guinness Nigeria Plc followed with 9.6 per cent, just as Honeywell Flour Mills Plc and NEM Insurance Plc chalked up 9.5 per cent each. Custodian Investment Plc added 9.4 per cent just as Niger Insurance Plc, Union Diagnostic and Clinical Services Plc and University Press Plc garnered 9.1 per cent, 8.0 per cent and 5.2 per cent respectively.

UBA was also among the price gainers, rising 2.0 per cent or N0.15 to close at N7.45 per share as investors took position ahead of dividend announcement by the bank. The board of directors of the bank will meet soon to approved its 2018 financial accounts and recommend a final dividend for the year. Having paid an interim dividend for the half year, expectations are high that UBA will give a dividend that is higher than what was paid the previous year.

Beta Glass Plc led the price losers with 10 per cent trailed by Northern Nigerian Flour Mills Plc with 9.2 per cent. Resort Savings and Loans Plc shed 8.8 per cent, while PZ Cussons Nigeria Plc and Neimeth International Pharmaceuticals Plc 8.3 per cent and 4.6 per cent in that order.

Activity level was, however, mixed as volume traded increased 1.9 per cent to 305.8 million shares while value traded declined 35.3 per cent to N2.1 billion. The top traded stocks by volume were Diamond Bank (141.2 million shares), Fidelity Bank Plc (18.6 million shares ) and GTBank (17.4 million shares) while GTBank(N577.7 million), Zenith Bank (N357.1 million) and Diamond Bank (N296.6 million) were the top traded by value.

The stock market appreciated further on Thursday as the bulls consolidated their hold on the market. As a result the NSE ASI appreciated 0.58 per cent to close higher at 30,137.53, while market capitalisation added N64.4 billion to end at N11.2 trillion.

Buying interest in Zenith Bank Plc, Dangote Sugar Refinery Plc and Stanbic IBTC Holdings Plc propelled the positive performance. However, Cement Company of Northern Nigeria Plc led the price gainers with 10 per cent, trailed by Ikeja Hotel Plc with 9.3 per cent. Royal Exchange Plc and C & I Leasing Plc garnered 9.0 per cent apiece. NEM Insurance Plc, AXA Mansard Insurance Plc and United Capital Plc chalked up 8.6 per cent, 8.3 per cent and 8.0 per cent respectively.

Conversely, Newrest ASL Services Plc led the price losers with 9.4 per cent followed by Veritas Kapital Assurance Plc with 9.0 per cent. Neimeth International Pharmaceuticals Plc shed 8.5 per cent, just as First Aluminum Nigeria Plc went down by 8.3 per cent.

Activity level also strengthened as volume and value traded surged 126.7 per cent to 300.1 million shares and 199.2 per cent to N3.2 billion. Diamond Bank (100.7 million shares), GTBank (39.4 million shares ) and UBA (26.2 million shares ) were the top traded stocks by volume, while GTBank(N1.3 billion), Zenith Bank (N463.0 million) and Diamond Bank (N209.4 million) were the top traded by value.

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Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Banking Sector

Access Holdings Plc Grants 23.81 Million Shares to Directors, Valued at N420 Million

Published

3 hours ago

May 8, 2024

Samed Olukoya

Access Holdings Plc, a leading financial institution, has recently vested approximately 23.81 million shares valued at over N420 million to its directors.

The share vesting process, a common practice in corporate governance, allows employees, investors, or co-founders to gradually receive full ownership rights to shares or stock options over a specified period.

In this instance, Access Holdings Plc has chosen to reward its directors with shares, signifying confidence in their leadership and contributions to the company’s growth trajectory.

Among the beneficiaries of this share allocation are key figures within Access Bank, a subsidiary of Access Holdings Plc, as well as the acting Group Chief Executive Officer (GCEO).

Recipients include Sunday Okwochi, the company secretary, who received 1.2 million shares at N17.95 per share, and Hadiza Ambursa, a director of Access Bank, who was allocated 1.72 million shares at the same price.

Other directors, such as Gregory Jobome, Chizoma Okoli, Iyabo Soji-Okusanya, Seyi Kumapayi, and Roosevelt Ogbonna, also received allocations ranging from 1.234 million to 12.345 million shares, each valued between N17.85 and N17.95 per share.

Bolaji Agbede, the acting Group CEO of Access Holdings, was granted 2.216 million shares at N17.95 per share, further solidifying his stake in the company’s success.

This move by Access Holdings Plc comes amidst a dynamic economic landscape, where organizations are strategically positioning themselves to navigate challenges and capitalize on emerging opportunities.

By incentivizing its directors through share vesting, the company aims to foster a sense of ownership and accountability while motivating top talent to drive innovation and sustainable growth.

The share vesting scheme not only rewards directors for their past contributions but also incentivizes them to remain committed to the company’s long-term vision.

Loans

Ghana’s $20 Billion Debt Restructuring Hangs in the Balance Amid LGBTQ Legal Challenge

Published

5 hours ago

May 8, 2024

Samed Olukoya

Ghana’s Supreme Court is set to commence hearings on a case that threatens the country’s $20 billion debt restructuring deal while simultaneously testing the World Bank’s commitment to LGBTQ rights support.

At the heart of the legal battle is a challenge to legislation that seeks to criminalize LGBTQ identities in Ghana.

The contentious law not only proposes severe penalties for individuals identifying as LGBTQ but also threatens punishment for those who fail to report individuals to the authorities, including family members, co-workers, and teachers.

If the Supreme Court upholds the legislation, Ghana risks not only perpetuating discrimination but also jeopardizing crucial financial support from international institutions, including the World Bank.

The implications extend beyond Ghana’s borders, potentially setting a precedent for how the World Bank engages with issues of LGBTQ rights and human rights more broadly across the globe.

The stakes are high for Ghana’s economy, which has been grappling with a heavy debt burden. The leaked memo from the finance ministry in April warned that endorsing the legislation could endanger approximately $3.8 billion of World Bank funding over the next five to six years.

Furthermore, it could derail a $3 billion bailout program from the International Monetary Fund (IMF) and hamper efforts to restructure the country’s $20 billion of external liabilities.

The legal challenge comes amidst a broader debate about the balance between national sovereignty, international lending standards, and human rights. The World Bank, a significant source of development finance for Ghana, finds itself caught in a delicate position.

While it has historically emphasized non-discrimination and social standards in its lending practices, it also faces pressure to respect the sovereignty of the countries it engages with.

Ghana’s debt restructuring and economic recovery efforts hinge on continued support from international financial institutions like the World Bank and the IMF.

However, the outcome of the Supreme Court case could complicate these efforts, potentially leading to a withdrawal of financial assistance and further economic instability.

The situation underscores the complexities of navigating the intersection of economic development, human rights, and national sovereignty.

As Ghana’s Supreme Court prepares to hear arguments on the LGBTQ legislation, the outcome of the case remains uncertain, leaving both advocates for LGBTQ rights and supporters of Ghana’s debt restructuring deal anxiously awaiting a decision that could shape the country’s future trajectory.

Banking Sector

Central Bank of Nigeria Mandates Cybersecurity Levy on Transactions

Published

1 day ago

May 7, 2024

Samed Olukoya

In a bid to bolster cybersecurity measures within the financial sector, the Central Bank of Nigeria (CBN) has issued a directive mandating banks and financial institutions to implement a cybersecurity levy on transactions.

The circular, released on Monday, outlines the commencement of this levy within two weeks from the date of issuance.

According to the circular, all commercial, merchant, non-interest, and payment service banks, as well as other financial institutions, mobile money operators, and payment service providers, are instructed to enforce this cybersecurity levy.

The directive is a follow-up to previous communications dated June 25, 2018, and October 5, 2018, emphasizing compliance with the Cybercrimes (Prohibition, Prevention, Etc.) Act 2015.

The levy is to be applied at the point of electronic transfer origination and subsequently deducted by the financial institution.

This deducted amount will then be remitted to the designated Nigerian Cybersecurity Fund (NCF) account domiciled at the CBN. Customers will see a deduction reflected in their account statement with the narration, ‘Cybersecurity Levy’.

Exemptions from this levy include certain transactions such as loan disbursements and repayments, salary payments, and intra-bank transfers among others.

The CBN aims to streamline and fortify cybersecurity efforts across the financial sector through the implementation of this levy.

This move by the CBN aligns with recent efforts to enhance regulatory oversight and mitigate risks within the financial ecosystem.

It follows closely after directives barring fintechs from onboarding new customers and warnings against engaging in cryptocurrency transactions.

Also, the Federal Government’s directive for the deduction of stamp duty charges on mortgaged-backed loans and bonds demonstrates a broader push for fiscal transparency and regulatory compliance.

The introduction of the cybersecurity levy underscores the CBN’s commitment to safeguarding digital transactions and ensuring the integrity of Nigeria’s financial infrastructure amidst evolving cyber threats.

As financial institutions gear up for implementation, the levy is poised to play a pivotal role in fortifying the nation’s cybersecurity resilience in an increasingly digitized landscape.