Nigerian Market Round-Up: Bullish run fizzle out as ASI sheds 220bps

Profit-taking pulls back the ASI: The bullish run in the equities market fizzled out today as the market recorded loss after ten consecutive trading days of gains, due to profit-taking by investors. The benchmark index shed 220bps to close at 34,941.8 points even as the market capitalization lost N267.1bn to settle at n11.9trn (US$59.6bn).  Today's loss was largely driven by profit-booking in the tier1 banking stocks - GUARANTY (-9.7%), ZENITHBANK (-5.0%), UBA (-4.9%); and other highly capitalised counters like SEPLAT (-9.8%), GUINNESS (-4.1%), NB (-3.8%), DANGCEM (-1.1%). Market activity also slowed down as the market breadth closed at 0.5x on the back of gains in 20 stocks against declines in 42 stocks.  While we expect to see some more profit-booking in the early part of the week, we  remain optimistic on the overall direction of the market this week as  positive sentiments  continue to drive investors' appetite. We believe there is still further upside from a valuation point of view; hence we expect the market to close positive this week.

Most sectors decline:  In line with the mood in the market today, most of the sectors posted negative daily returns today. The Financial Services sector closed with -4.5% daily return as the banking stocks such as GUARANTY (-9.7%), ZENITHBANK (-5.0%), UBA (-4.9%) and ACCESS (-2.3%), declined due to profit taking activities. Depreciation in SEPLAT (-9.8%) and FO (-3.5%) also depressed the Oil and Gas sector to return -4.4%. Consumer Goods sector returned -1.5% as PZ (-4.7%), GUINNESS (-4.1%) and NB (-3.8%) declined. In the same vein, loss in heavyweight DANGCEM weighed down the Industrial Goods sector to post -0.9% return. 

Headline	Today	Previous Session	Change
NSE All Share Index (points)	34,941.8	35,728.1	-2.2%
Market Capitalization  (N'bn)	11,868.0	12,135.1	-2.2%
Market Capitalization  ($'mn)	59,587.2	60,934.3	-2.2%
Total Value Traded (N'mn)	8,313.2	18,753.8	-55.7%
Total Value Traded ($'mn)	41.7	94.2	-55.7%
Total Volume Traded (Mn Units)	581.8	1,174.4	-50.5%

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Sell-offs in the fixed income space

both the Bond  and Treasury Bills markets traded bearish today as sell-offs hit the market. Average yield in the increased by 17bps to 14.3% as yields for most of the instruments increased. Yield for JAN-2022 however declined by 7bps while JUL-2030 traded flat. The Treasury Bills market was also bearish as the average yield added 37bps to close at 13.9%. Yields for the 3M, 9M and 12M instruments increased by 30bps, 13bp and 11bps respectively.  

The USD/NGN declined marginally by 1bp to close at N199.17/US$, at the interbank market today.