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Research

Price declines in AIRTELAFRI, DANGCEM, and MTNN Drive NGX Southwards.

Last week, the Nigerian equities market closed on a negative note with price declines in large-cap stocks such as AIRTELAFRI (-0.39%), DANGCEM (-0.80%), and MTNN (-2.00%) which drove the local bourse southwards.

Outlook for the Week

We expect bargain hunting in attractively priced tickers to drive the local bourse upward this week.

The Nigerian Fixed Income Market

Last week, in the bond market, there was mixed sentiments as two of the tenor yields under coverage closed lower.

In the NTB market, there was mixed sentiments, while at the NTB primary market, auction bills were oversubscribed by 60.70%.

Outlook for the week

The result of the bond auction to be held by the Debt Management Office (DMO), scheduled to hold this week, in addition to the results of the inflation report, would likely dictate the market’s tone this week.

The Global and African Market

There was an unprecedented rally in global stocks following the release of the U.S CPI data.

In the African Market, bullish sentiments drove upward three of the four indices under our coverage.

AFEX Commodities market

ACI remained unchanged while the AEI declined 2.21%, closing the week 202.33 points, down from 206.91 points where it started the week. The ACI and AEI remained positive at 5.89% and 6.49%, respectively y-t-d.
Domestic Economy

  • Nigeria’s Oil Revenue drops by $12.6 billion in Nine months
  • Nigeria’s Oil Production Exceeds 1mpd in October 2022
  • Fitch Downgrades Nigeria’s Long-Term Foreign Currency Issuer Default Rating (IDR) to “B-” from “B”.
  • The Naira gained Significantly against the U.S. Dollar in the Black market.

Global Economy

  • Inflation in the U.S came in cooler than expected in October 2022, printing at 7.70% from 8.20% in September 2022. Following the data release, stocks soared, treasury yields declined, and the dollar weakened against major currency pairs globally.
  • The Uk Economy Contracted by 0.20% in the third quarter of 2022, signaling what could be the start of a recession.
  • China’s Exports unexpectedly declined in October 2022 due to a drop in the value of goods sold to the U.S. and E.U.
  • China announced steps to ease its Covid policy by shortening quarantine requirements, simplifying travel rules, and adjusting its monitoring and control regime.
  • Ghana’s Inflation rate climbed to 40.40% in October 2022 as the cost of goods and services continued to soar in the West African nation.

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