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Stock Investors Lose Another N87bn as Market Rout Continues

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  • Stock Investors Lose Another N87bn as Market Rout Continues

The Nigerian stock market extended its losing streak as uncertainty and weak sentiment chase investors from the exchange.

The stock exchange lost N87 billion on Thursday after losing N111 billion on Monday, N68 billion on Tuesday and N77 billion on Wednesday to take its total losses this week to N343 billion.

On Thursday, increased sell-off plunged market capitalisation of listed equities from N13.667 trillion on Wednesday to N13.580 trillion, representing another N87 billion decline.

The NSE All-Share Index declined by 0.64 percent to settle at 27,864.49 basis points.

Seplat Petroleum Development Company Plc, MTN Nigeria Communications Plc and Ecobank Transnational Incorporated led top sell-off stocks to drag the year-to-date loss to –11.3 percent.

Activity on the floor dipped on Thursday as only 175.4 million units of shares valued at N2 were traded in 2,653 deals, another decline of 28 percent in volume and 30.2 percent in value.

FBN Holdings Plc (33.3 million units), Zenith Bank Plc (21.2 million units) and Sterling Bank Plc (16.7 million units) were the most traded stocks by volume.

While the Nigerian Breweries Plc (N461.3 million), Zenith Bank (N395.1 million) and MTN Nigeria (N334.0 million) were the most traded stocks by value.

All traded sectors closed in the red except industrial goods sector which advanced by 0.06 percent on Thursday.

Nigerian stock investors remain wary of economic uncertainty even with rising foreign reserves. Experts said until President Buhari form a cabinet and provide a clear economic path for investors presently on the sideline, the stock exchange will remain weak.

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

Central Bank to Promote Zero Balance Account Opening to Drive Financial Inclusion

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Central Bank

Banks Now Accept Zero Balance Account Opening to Deepen Financial Inclusion

In an effort to boost financial inclusion in the country, the Central Bank of Nigeria has said it would start promoting zero balance account opening to encourage and lure the unbanked into the banking system.

The apex bank disclosed this in its report titled ‘Monetary, credit, foreign trade and exchange policy guidelines for fiscal years 2020/2021’.

The report read in part, “As part of its effort towards promoting greater financial inclusion in the country, the bank shall continue to encourage banks to intensify deposit mobilisation during the 2020/2021 fiscal years.

“Accordingly, banks shall allow zero balances for opening new bank accounts and simplify their account opening processes, while adhering to Know-Your-Customer requirements.

“Banks are also encouraged to develop new products that would provide greater access to credit.”

The apex bank said the Shared Agency Network Expansion Facility, launched to deepen provision of financial services in under-served and unserved locations and drive financial inclusion through agent banking, would continue in the 2020/2021 fiscal years.

Banks, mobile money operators and super-agents would also continue to render returns in the prescribed formats and frequency to the CBN.

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Finance

Investors Oversubscribed for FGN Bonds by N205.87 Billion in October

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bonds

FG October Bonds Oversubscribed by N205.87 Billion

The Debt Management Office (DMO) has said investors oversubscribed for the Federal Government’s October bonds by N205.87 billion.

The DMO stated this after concluding the monthly FGN bonds auction on Wednesday.

Two instruments of 12.5 per cent FGN March 2035 re-opening 15-year bond and 9.8 per cent FGN July 2045 re-opening 25-year bond were auctioned.

The two bonds of N15bn each with a total auction figure of N30bn received a subscription of N235.87bn.

The 15-year tenor and 25-year tenor bonds received 99 and 67 bids but recorded 21 and 26 successful bids respectively.

The amounts allotted for each of the bids were N20bn and N25bn respectively.

According to the DMO, successful bids for the 15-year tenor bond and 25-year tenor bonds were allotted at the marginal rates of 4.97 per cent and six per cent respectively.

However, it added, the original coupon rates of 12.5 per cent for the 12.5 per cent FGN March 2035 bond and the 9.8 per cent for the 9.8 per cent FGN July 2045 bonds would be maintained.

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Finance

Lafarge Africa Sustains Growth in Third Quarter, Reports N53.3bn Revenue

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Lafarge Africa

Lafarge Africa Grows Revenue by 31.4 Percent to N53.3bn Revenue in Q3 2020

Lafarge Africa Plc, a cement manufacturer headquartered in Lagos, sustained its strong growth in the third quarter (Q3) ended September 30, 2020.

In the company’s financial results released on the Nigerian Stock Exchange on Friday, the cement manufacturer’s revenue rose by 31.4 percent from N45.172 billion posted in the third quarter of 2019 to N59.337 billion in the third quarter of 2020.

Similarly, operating profit grew by 7.2 percent from N7.746 billion in the corresponding quarter to N8.302 billion in the quarter under review. This strong performance continues across the board as net income expanded by 2.8 percent to N4.867 billion, up from N4.734 billion posted in the third quarter of 2019.

Lafarge earnings per share rose by 2.8 percent to 30 kobo in the third quarter, again up from the 29 kobo posted in the same period of 2019.

On the outlook for the company going forward, the company said:

 Market demand is expected to remain strong in Q4.
 Naira devaluation and inflation remain a concern in Q4.
 The implementation of our “HEALTH, COST & CASH” initiatives would continue to deliver
improvement in our performance.
 We will maintain a healthy balance sheet.

Speaking on the company’s performance, Khaled El Dokani, CEO, Lafarge Africa Plc, said “Our robust results for the first 9 months reflect the strong recovery of the demand in Q3 and the successful implementation of our “HEALTH, COST & CASH” initiatives. Both have delivered considerable improvement in recurring EBIT, net income and free cash flow, despite the impact of the COVID-19 pandemic and Naira devaluation, particularly in Q3.

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