This week was a slightly bearish one on the Nigerian Stock Exchange, as the All Share Index closed at 30,866.82 basis points, down 0.02%.
30 equities appreciated in price during the week, higher than 25 in the previous week. 38 equities depreciated in price, lower than 41 of the previous week, while 101 equities remained unchanged, lower than 103 equities recorded in the preceding week.
Diamond Bank Plc
Diamond Bank was the best performing stock this week on the Nigerian Stock Exchange. The stock opened at N0.65 and closed at N1.02, up 56.92%. Year to date, the stock however remains in the red, down 32%.
Ikeja Hotels Plc
Ikeja Hotels came a distant second. The stock gained 11.31% this week, opening at N1.68 and closing at N1.97, up N0.19. Year to date, the stock is up 5.06%.
AIICO Insurance Plc
AIICO Insurance appreciated by 11.11% this week. The stock opened at N0.63 and closed at N0.70. Year to date, the stock is up 34.62%.
Jaiz Bank Plc
Jaiz Bank Plc opened at N0.40 and closed at N0.44, up N0.04 or 10%. Year to date, the stock is down 30.16%.
Champion Breweries Plc
Champion Breweries gained 9.66% this week. The stock opened at N1.45 and closed at N1.59, up N0.14. Year to date, the stock is down 23.56%.
Oando Plc opened at N4.70 and closed at N5.15 up N0.45 or 9.57%. Year to date, the stock is down 14.02%
Learn Africa Plc
Learn Africa Plc opened at N1.16 and closed at N1.26, up N0.10 or 8.62%. Year to date, the stock is up 43.1%
Cutix Plc added 8.24% in this week’s trading. The stock opened at N1.82 and closed at N1.97, up N0.15. Year to date, the stock is down 1.99%.
Wema Bank Plc
Tier two lender, Wema Bank, opened at N0.51 and closed at N0.55, up N0.04 or 7.84%. Year to date, the stock is up 5.77%.
FBN Holdings Plc
FBN Holdings rounds up the top ten gainers for the week. The stock gained 7.04%, opening at N7.10 and closing at N7.60, up N0.50. Year to date, the stock is down 13.64%.
Continental Reinsurance Plc
Continental Reinsurance Plc was the worst performing stock this week. The stock shed 12.50%, opening at N2 and closing at N1.75, down N0.25. Year to date the stock is up 25%.
Trading in the stock has been volatile since a potential acquisition bid was announced.
Prestige Assurance Plc
Prestige Assurance Plc opened at N0.55 and closed at N0.49, down N0.06 or 10.1%. Year to date, the stock is down 2%.
Newrest ASL Nigeria Plc
Newrest ASL declined by 10% this week. The stock opened at N7 and closed at N6.30, down N0.70.
MRS Oil Nigeria
MRS Oil Nigeria opened at N38.55 and closed at N25.70, down N2.85 or 9.98%. MRS was Nairametrics’ stock pick for the week. Year to date, the stock is down 6.41%.
SCOA Nigeria Plc
The conglomerate opened at N3.25 and closed at N2.93, down N0.32 or 9.85%. Year to date, the stock is down 9.85%.
Northern Nigeria Flour Mills
Northern Nigeria Flour Mills (a subsidiary of Flour Mills of Nigeria Plc) shed 9.43%. The stock opened at N5.30 and closed at N4.80, down N0.50. Year to date, the stock is down 15.79%
Trans–Nationwide Express Plc
Trans-Nationwide Express declined by 9.23% this week. The stock opened at N0.65 and closed at N0.59, down N0.06 or 9.23%. Year to date, the stock is down 24.36%.
First Aluminum Nigeria Plc
First Aluminum Plc opened at N0.33 and closed at N0.30, down N0.03 or 9.09%. Year to date, the stock is down 40%.
Niger Insurance Plc
Niger Insurance declined by 9.09% this week. The stock opened at N0.22 and closed at N0.20, down N0.02. Year to date, the stock Is down 60%.
Cement Company of Northern Nigeria Plc
Cement Company of Northern Nigeria rounds up the top 10 losers for the week. The stock opened at N18 and closed at N16.50, down N1.50 or 8.33%. Year to date, the stock is up 73.68%. CC
Consumer goods index turns Nigerian Bourse bearish, amidst poor market liquidity
All indexes closed in the negative terrain with the exception of the Banking Index.
Nigerian stock market ended the week trading session on a bearish note, extending its previous day loss. The All-Share Index and Market Capitalization down by 0.16% to 24,336.12 points and N12.695billion respectively. Thus, YTD performance stands at -9.35%.
Similarly, market turnover finished lower compared to the previous trading session. Total volume and value of stocks traded decreased by 19.88% and 17.59% to 144.31 million units and N1.52 billion respectively.
GUARANTY was the most traded stock by volume at 29.1million units, followed by ZENITHBANK, with 27.2 million units of trades.
Market sentiment, as measured by market breadth, was negative as 27 tickers declined, relative to 9 gainers.
REDSTAREX and UACN were the top losers of the day with 10.00% apiece price decline, while IKEJAHOTEL and WEMABANK topped the gainers with 9.68% and 5.77% appreciation in share value.
Performance across sectors mirrored the broad index. All indexes closed in the negative terrain with the exception of the Banking Index, which gained 0.32%. The Consumer Goods Index (1.07%) was the biggest loser of the day due to losses recorded in UACN (-10.00%) and NB (-5.68%).
The Insurance, Oil and Gas and Industrial Goods indexes trailed to shed 0.61%, 0.13% and 0.04% respectively, due to price depreciation in AIICO (-3.37%), ARDOVA (-1.27%) and WAPCO (-0.96%)
IKEJAHOTEL up 9.68% to trade at N1.02,WEMABANK up 5.77% to trade at N0.55,ZENITHBANK up 3.04% to trade at N15.25,FCMB up 2.27% to trade at N1.8,GUARANTY up 0.48% to trade at N20.8
UACN down 10.00% to close at N7.2 REDSTAREX down 10.00% to close at N2.97, JBERGER down 7.56% to close at N18.35NB down 5.68% to close at N34.05, NASCON down 1.96% to close at N10
Sell-offs in UACN, JBERGER and NB dragged the Nigerian bourse down coupled with thin liquidity in the Nigerian Stock Market. Nairametrics envisages cautious buying of Nigerian stocks, as Institutional investors remain on the sidelines.
U.S dollar remains neutral as strong economic macros weaken its demand
The U.S. Dollar Index was slightly down at 0.02% to 97.040 at 1.30 pm Nigerian time.
U.S dollar pulled back sessions high on Friday as Economic data released earlier showed the second-largest economy service sector printing impressive results, with the (Chinese) Caixin Services Purchasing Managers Index coming in at 58.4 in June, the highest reading in two months.
The U.S. Dollar Index that monitors the American dollar against a group of other major currencies was slightly down at 0.02% to 97.040 at 1.30 pm Nigerian time.
Consequently about 24 hours ago the world largest economy recorded an addition of 4.8 million jobs in June and manufacturing activity printing a better economic result than expected, this further suggests that the economic stimulus by the U.S Fed Reserve seems to be working.
In addition, Currency analysts at ING, in a research note spoke about the U.S Federal Reserve stimulus package in relation to the strength of the dollar.
“Fed money printing has now secured what seems to be a stable negative correlation between risk assets and the dollar,”
“As long as the Fed is still buying assets and prepared to do more, we expect this negative correlation, Risk On, Dollar Off, to dominate financial markets over the coming quarters. Economies slowly getting back on their feet should mean a backdrop of a benign dollar bear trend in the second half of the year.”
Why this matters; The U.S. Dollar Index that tracks the American dollar against a basket of other major currencies (like the Japanese yen, British pound sterling, Swedish Krona, Euro), Individuals hoping to meet foreign exchange payment obligations, via dollar transactions to countries like Europe, and Japan, would need to pay more dollars in fulfilling such transactions
CBN adjust naira from N360 to N380 at SMIS
Reports reaching Nairametrics indicates the CBN has instructed bidders at its Secondary Market Intervention Sales (SMIS) to increase their bidding price to N380/$1 floor. The SMIS is the market where importers bid for forex using Letters of Credit and Form M.
According to our sources, the central bank informed banks that they will only accept bids from N380/$1 and above and no longer N360/$1 meaning those who bid lower will not get any forex allocation. Transaction success in this market is based on bids with those who bid higher than the floor as they are often in an advantageous position to secure forex.
This is essentially a huge attempt at unifying the naira and another adjustment of the exchange rate by the CBN. Recall the CBN Governor had informed investors that the bank will be unifying the exchange rate towards what is being traded at the NAFEX market where investors and exporters trade forex.
Nairametrics understands a circular has been sent to banks but we are yet to see it.
The SMIS window was created by CBN for importers to ease the pressure faced by businesses in the foreign exchange market through sales of foreign currency to authorized dealers (wholesale) or to end users through Authorized dealers. Businesses usually conduct their bid for forex at the SMIS window every two fortnight.
Currently, rates are set at a floor of N360/$1 and a ceiling of N385/$1. Thus bidders are expected to bid within that range. The higher the bid the better your chances at getting forex. It is unclear if there were any buyers that bid above N360 as we gather most of the importers were not informed of the changes in prices until today.
In February, the CBN has injected $218.41 million into the inter-bank retail Secondary Market Intervention Sales (SMIS). The dollar sold at the time meant for only agricultural and raw materials sectors, is in continuation of its intervention in the inter-bank foreign exchange market. In May, the central bank surprised the market by injecting estimated $90-$100million to the system.