Financial industry leads as investors spend N15.5bn on shares in one week

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BY BAMIDELE FAMOOFO

Uba Group

A total turnover of 1.41 billion shares worth N15.51 billion in 19,025 deals was traded last week by investors on the floor of the Exchange, in contrast to a total of 598.817 million shares valued at N14.234 billion that exchanged hands in the preceding week in 15,859 deals.

The Financial Services Industry (measured by volume) led the activity chart with 804.570 million shares valued at N6.300 billion traded in 9,922 deals; thus contributing 57.04 percent and 40.62 percent to the total equity turnover volume and value respectively.

The Agriculture Industry followed with 357.623 million shares worth N287.992 million in 560 deals.

The third place was the Conglomerates Industry, with a turnover of 68.309 million shares worth N97.051 million in 530 deals.

Trading in the top three equities namely Access Holdings Plc, FTN Cocoa Processors Plc and Fidelity Bank Plc. (measured by volume) accounted for 800.622 million shares worth N3.373 billion in 2,051 deals, contributing 56.76 percent and 21.75 percent to the total equity turnover volume and value respectively.

The NGX All-Share Index and Market Capitalization appreciated by 0.81 percent to close the week at 44,269.18 and N24.112 trillion respectively.

Similarly, all other indices finished higher with the exception of NGX-Main Board, NGX CG, NGX Banking, NGX Pension, NGX Insurance, NGX-AFR Bank Value, NGX MERI Value, NGX Consumer Goods, NGX Oil & Gas and NGX Sovereign Bond indices which depreciated by 0.44 percent, 0.27 percent, 1.87 percent, 0.44 percent, 1.35 percent, 0.79 percent, 0.98 percent, 2.32 percent, 5.37 percent and 1.36 percent respectively, while the NGX ASeM and NGX Growth indices closed flat.

20 equities appreciated in price during the week, lower than twenty-nine (29) equities in the previous week. Forty-three (43) equities depreciated in price higher than thirty-one (31) in the previous week, while ninety-four (94) equities remained unchanged lower than ninety-seven (97) equities recorded in the previous week.

At the money market, the overnight (OVN) rate crashed by 767bps w/w to 8.8 percent in the review week, as the system liquidity improved primarily due to the combination of FAAC disbursement (N465.95 billion) from the prior week and inflows in the week from OMO maturities (N20.00 billion).

For clarity, the average system liquidity closed higher this week at a net long position of N407.81 billion versus a net short position of N15.48 billion in the previous week.

Financial analysts expect the OVN rate to tilt upwards in this week, as they believe the inflow from OMO maturities (N105.00 billion) may not be enough to offset the debit for CBN (NTB, OMO & FX) auctions.

Also last week, sentiments in the NTB secondary market turned bullish following the healthy system liquidity as local banks sought to sterilize their idle cash by demanding T-bills. As a result, the average yield across all instruments contracted by 6bps to 10.0 percent. Across the market segments, the average yield contracted both at the NTB and OMO secondary market by 7bps to 11.9 percent and 2bps to 10.2 percent, respectively.

This week, experts expect yields in the T-bills secondary market to trend northwards, given the anticipated squeeze in the system. Notwithstanding, they believe participants will shift focus to this week’s NTB PMA, as the CBN is set to roll over N193.03 billion worth of maturities.

Meanwhile, bearish sentiments persisted in the FGN bonds secondary market in the review week, as the average yield across all instruments expanded by 20bps to 14.5 percent.

“We highlight that investors’ anticipation of higher bond yields drove sell-offs across the short and mid-spectrum of the curve this week. Consequently, across the benchmark curve, the average yield inched higher at the short (+38bps) and mid (+35bps) segments, following profit-taking on the MAR-2024 (+105bps) and NOV-2029 (+37bps) bonds, respectively. Meanwhile, the average yield contracted at the long (-6bps) end, following investors’ interest in the MAR-2035 (-34bps) bond,” Cordros Capital noted in a report.

During the review week, Nigeria’s FX reserves maintained its decline for the ninth consecutive week, falling by USD101.78 million w/w to USD37.37 billion (01 November).

At the I&E window (IEW), the naira depreciated by 0.2 percent to N445.50/USD. At the IEW, total turnover (as of 03 November) declined by 9.8 percent WTD to USD327.07 million, with trades consummated within the N424.00 – N460.25/USD band. In the Forwards market, the naira appreciated at the 1-month (+0.1% to N449.03/USD) and 3-month (+0.1% to NGN458.39/USD) contracts but depreciated at the 2-months (-0.1% to N453.39/USD) and 1-year (-0.3% to N502.47/USD) contracts. Conversely, the naira was flat at the 6-month (N476.49/USD) contract.

“CBN"