Investors maintain positive sentiment in the local equities market following continuous low yield in the fixed income space. The market opened the week with a 4bps declined followed by gains in the remaining 4 trading sessions.
Notably, the All-Share Index (ASI) advanced by 2.57% WoW to close at 34,136.82 while market capitalizations gained N390.25bn to settle at N18.23 tn. Consequently, the year-to-date (YtD) performance expands to +29.97%.
Market breadth, a measure of Investors’ sentiment improves from 0.30x to 0.63x as 27 stocks advanced while 43 stocks declined last week. UPDCREIT(+32.53%), NEIMETH(+12.03%) and NCR(+10.00%) were the top market gainers while JAPAULOIL(-11.11%), HONEYWELL(-10.83%) and CUSTODIAN(-10.83%) top the losers chart.
Market activity level waned as volume and value of transaction declined. Specifically, Market volume and value went down by 84.07% and 28.14%.
Trading in the shares of Zenith, Access and Transcorp accounted for 649.529 million shares worth
N8.104 billion in 6,395 deals, contributing 35.76% and 31.42% to the total equity turnover volume and value respectively. In reaction to current macroeconomics conditions especially in the FX space, we expect mild negative sentiments from investors during the week.
The bonds market traded on a positive note last week with yield depressing across different maturities following an oversubscribed CBN auction on Wednesday. Specifically, Yields on 23-JUL-2030 bond and 27-APR-2023 compressed by 0.36% and 3.04% to 4.37 and 1.77. However, Yield on 22-JAN-2026 and 18-JUL-2034 advanced by 12.99% and 1.51% to settle close at 3.81 and 5.07 respectively.
As more OMO maturities flow into the market amid the current buoyant system liquidity, we expect further compression in rate.
The US S&P 500 and Dow Jones indices both declined by 0.73% and 0.77% as optimism of early closure on vaccine waned. Other global stocks however advanced marginally as UK FTSE and German DAX gaining 0.56% and 0.46% while French CAC and Japan NIKKEI advanced by 2.15% and 0.56% respectively.
As uncertainty about White house transition fades, we expect more positive sentiment from US investors this week.