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Research

NGX: Sell-offs in Telecoms Stocks Dip Market Cap by ₦570.91 Billion

The Nigerian All-Share Index closed negative, declining by 2.31% to close at 44,318.15 points. The performance was due to sell-offs in bellwether stocks such as AIRTELAFRI (-10.00%) and MTNN (-2.01%). Consequently, the YTD return decreased to 3.75% as market capitalization decreased by ₦570.91 billion to close at ₦24.14 trillion.

The sectoral performance marginally strengthened as three of the five indices under coverage advanced. The Industrial index, the biggest gainer, rose by 0.94%, on BUACEMENT (+3.83%). The Banking and Insurance indices, followed suit, rising by 0.50% and 0.24% on FBNH (+1.57%) and AIICO (+5.56%) respectively. Conversely, the Oil & Gas and Consumer Goods indices, the losers, fell by 0.80% and 0.03% on TOTAL (-6.68%) and DANGSUGAR (-1.92%) respectively.

Investors’ sentiment weakened as the market breadth decreased to 0.94x from 1.20x. This was illustrated by the decline of 17 stocks, led by AIRTELAFRI (-10.00%) and MRS (-9.76%) and the advance of 15 stocks, led by FIDELITYBK (+9.74%) and JAIZBANK (+7.06%). Activity level was mixed as the total volume decreased by 60.66% and while the value advanced by 1.36%, as investors exchanged about 165.35mn units of shares worth over ₦3.67bn.

We expect positive sentiment to return in the next trading session as the equities market still presents decent opportunities for investors chasing positive real returns on investments.

Fixed Income

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

The yields for the 91 and 182-day paper closed flat at 6.05% and 9.85% respectively while the 364-day paper advanced by 36bps to close at 15.43%.

Market Forcast

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

  • Negative Performance  Persists in the Local Bourse, NGX ASI Sheds 231bps
  • Quite Outing across the Bond Yield Curve
  • Negative Performance in Global Stocks
  • Brent Crude ZReports @ $90.88/barrel
  • Negative Performance in African Stocks