Domestic Bourse Extends Negative Trajectory, NGX ASI Sheds 145bps

June 1, 2022

Local Bourse Bounces Back To Bullish Mood

At the end of yesterday’s trading session, the Nigerian All Share Index closed negative, declining by 1.45% to close at 52,990.28 points.

Yesterday’s performance was due to profit-taking in bellwether stocks such as NB (-9.96%) and FLOURMILL (-0.98%). Consequently, the YTD return decreased to 24.05% as market capitalisation decreased by ₦421.51 billion to close at ₦28.57 trillion.

The sectoral performance weakened significantly as four of the five indices under coverage declined. The Industrial index, the biggest loser, fell by 3.60% on WAPCO (-2.35%). The Consumer Goods, Banking and Insurance Indices, followed suit, falling by 1.78%, 0.15% and 0.13% on FLOURMILL (-0.98%), ZENITHBANK (-1.68%) and ROYALEX (-1.92%) respectively. Conversely, the Oil & Gas index, the only gainer, rose by 0.05 on ARDOVA (+0.66%).

Investors’ sentiment weakened as the market breadth decreased to 1.18x from 1.47x. This was illustrated by the decline of 17 stocks, led by NB (-9.96%) and NNFM (-9.83%) and the advance of 20 stocks, led by TRANSCOHOT (+6.84%) and CHAMPION (+5.05%). Activity level was weakened as the total volume and value decreased by 98.85% and 98.09% respectively, as investors exchanged about 318mn units of shares worth over ₦3.71bn.

We expect negative sentiment to persist on the back of profit-taking activities on stocks that have significantly appreciated.

Fixed Income

There was a relatively quiet outing across the bond yield curve as three of the four bond yields under coverage closed flat while the FGN-MAR-2024 bond paper compressed by 1bp. The FGN-APR-2023, FGN-JAN-2026 and FGN-JUL-2030 bond paper yields closed flat respectively.

Treasury bill yields for the 91, 182 and 364-day paper closed flat at 2.72%, 4.29% and 4.92% respectively.

We expect market activity to be influenced by the liquidity levels in the financial system.

Market Snapshot