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Daily Equities Market Recap: MTN Nigeria changes to PLC, as index dips

The Influx of news on Dangote Flour Mills Plc and the potential listing and restructuring of MTN Nigeria, inundated most analysts and investors’ opinion.

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MTN
  • INFINITY proposes 3kobo final dividend per ordinary share
  • PORTLAND, AUSTINLAZ and TRANSCORP release Q1
    2019 financial results
  • The Board of CILEASING meeting holds on 30th April, 2019
  • UNIVERSAL INSURANCE notifies the Exchange on delay in Filing its Q1 2019 reports
  •  SAHCO enlisted on the main board of the Exchange

Market Summary

The Influx of news on Dangote Flour Mills Plc and the potential listing and restructuring of MTN Nigeria, inundated most analysts and investors’ opinion on the Customs street, yesterday.

On Tuesday, DANGFLOUR notified the Exchange of its consideration to receive a binding offer from Olam international limited to acquire the enterprise value at N130billion which is largely
subject to the extant laws and approvals for acceptance. However, the stock went on total bid, yesterday, appreciating by as much as 20% in two consecutive trading sessions this week. This development is despite the caveat in the disclosure that investors should trade with
caution.

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Elsewhere, MTN Nigeria announced that it has changed its legal status from a private limited company (Ltd) to a public limited Company(Plc), in a bid to reaffirm its commitment to its listing
by introduction on the Exchange. Thus, this is expected to increase the depth of the Nigerian equities market and reduce its degree of skewness to the industrial and banking sectors
counters.

That said, the NSE All Share index remained inert to likely positive drives that could be hidden in the news and financials of the listed companies, as its dipped -0.58% to end below the psychological line at 29,898.31. The market cap lost N66.78billion upon significant sell-offs in TRANSCORP and WAPCO, just as OANDO, WEMABANK, MOBIL, DANGCEM, UACN, and STANBIC shed their previous gains to end in the negative territory.

However, JAPUALOIL, FIRSTALUM, UCAP, UBA, ACCESS, and FBNH have continued to maintain trends in the north while bargain hunters pushed AIICO, FIDELITYBK, FLOURMILL, GUARANTY, and AFRIPRUD in the bull market from the previous losses recorded.

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Meanwhile, the level of activities by volume and value traded dropped -3.56% and –
2.7.83% to finish at 304.86million and N2.630billion apiece.

Review of Sectoral Performance

The financial sectors escaped the bears as the Banking sector and Insurance
indexes rose fractionally by 0.93% and 0.79% to close at 388.10 and 120.73, following the buying interest in REGALINS 8.33%, AIICO 5.63%, WAPIC 2.50%, UBA 2.1%, ZENITHBANK 2.15%, and UNITYBANK 2.5%, among others.

On the decliners’ table, Oil and gas sector dipped the most by -3.61% due to sell
pressure in CONOIL -9.57%, OANDO -5.88%, SEPLAT -4.39% and MOBIL -2.72% while
industrial and Consumer goods indexes dipped -0.70% and -1.10% upon the
depreciation recorded in INTBREW -8.70%, NESTLE -1.90%, WAPCO -1.31% and
DANGCEM -0.94%.

Deal book 300 x 250

Investors Sentiment: The Market breadth closed positive at 1.86x

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Investors sentiments remained strong in the lightweight counters thereby seeing the
breadth uptrends, but the depreciation in heavyweight counters; DANGCEM, NESTLE,
MOBIL and SEPLAT weighed on the benchmark index. We expect still positive interest in the banking sector in the meantime.

Patricia

About MorganCapital

MorganCapital Securities Limited (“MorganCapital”), formerly known as International Capital Securities Limited,
was incorporated on 28th January, 1997; and was issued a license as a Dealing Member of the NSE on 3rd October,
1997, after obtaining license of the Securities & Exchange Commission (SEC) as a Broker/Dealer.

CONTACT US
Research Omosuyi Temitope temitopeo@morgancapitalgroup.com
Investment Banking Dipo Olomofe dipoo@morgancapitalgroup.com
Adewale Adetiba adewalea@morgancapitalgroup.com
Securities Dealing Esther Adelaja esthera@morgancapitalgroup.com
Michael Joel michaelj@morgancapitalgroup.com
For further information, please contact:
MorganCapital Securities Limited
The Pent House
3 Biaduo Street, Off Keffi Street
S/West Ikoyi
Lagos, Nigeria
Tel: 234-(1) 3429613, 234-(1)4540114
Email: info@morgancapitalgroup.com
www.morgancapitalgroup.com

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Around the World

Buhari nominates Okonjo-Iweala as DG World Trade Organization

President Muhammadu Buhari nominated the former Minister of Finance and Coordinating Minister of the economy, Ngozi Okonjo Iweala, as the Director-General of the World Trade Organization (WTO).

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Nigeria’s former finance minister, Okonjo-Iweala, gets IMF appointment

President Muhammadu Buhari has nominated the former Minister of Finance and Coordinating Minister of the Economy, Ngozi Okonjo Iweala, as the Director-General of the World Trade Organization (WTO).

This was seen in a tweet posted by the Presidential aide on Digital and New Media, Tolu Ogunlesi, in the early hours of Friday, June 5, 2020.

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In the statement, Ogunlesi said that the current Director-General of the intergovernmental organization, Roberto Azevedo, is stepping down from his position on August 2020, a year ahead of the end of his tenure.

Azevedo, who has been the head of the WTO since 2013, is stepping down at this critical period of global economic crisis and the trade war between the United States of America and China.

This means that the election that was earlier scheduled for 2021 when his tenure was supposed to expire might be coming up much earlier for a new four-year term.

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Tolu Ogunlesi in his statement said, ”President Muhammadu Buhari has nominated Okonji-Iweala as Nigeria’s candidate for the position of the Director-General of World Trade Organization. DG Azevedo is stepping down in August 2020, a year earlier, so the election of the new DG, originally scheduled for 2021, may take place much earlier”.

Details later…

 

 

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Patricia
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Around the World

Just-in: AfDB board agrees to an independent probe of Akinwumi Adesina

The independent review shall be conducted by a neutral high calibre individual with unquestionable experience, high international reputation and integrity within a short time period of not more than two to four weeks maximum, taking the Bank group’s electoral calendar into account.

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Dr. Akinwnmi Adesina, Lutoyilex Construct Ltd, Fraud, AfDB

The Bureau of the Board of Governors of the African Development Bank (AfDB), has agreed to authorize an independent review of the report of the ethics committee of the bank’s board of directors on the allegations levied against the President of the Bank, Akinwumi Adesina.

This was contained in a communique which was released and signed by the Chairperson of the Bureau of Board of Governors, Ms Niale Kaba, after the meeting of the bureau board of governors on June 4, 2020, with respect to the complaints against the President of the bank.

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In taking the decision, the Bureau agreed that the ethics committee performed its role on this matter in accordance with the applicable rule under resolution B/BG/2008/11 of the board of governors and that the Chairperson of the Bureau of Board of Governors performed her role in accepting the findings of the ethics committee in accordance with the said resolution.

The bank’s board of governors in its statement said, ‘’Based on the views of some Governors on the matter and the need to carry every Governor along in resolving it, the Bureau agrees to authorize an independent review of the report of the ethics committee of the board of governors relative to the allegations considered by the ethics committee and the submissions made by the President of the Bank Group thereto in the interest of due process.

‘’The independent review shall be conducted by a neutral high calibre individual with unquestionable experience, high international reputation and integrity within a short time period of not more than two to four weeks maximum, taking the Bank group’s electoral calendar into account.

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‘’The Bureau agrees that, within a three to six months period and following the independent review of the ethics committee report, an independent comprehensive review of the implementation of the bank’s group whistleblowing and complaints handling policy should be conducted with a view to ensuring that the policy is properly implemented, and revising it where necessary, to avoid situations of this nature in the future.’’

Following the allegations of unethical conducts, questionable appointments and contract awards by a group of whistleblowers and the subsequent clearance of all charges by the bank’s ethics committee, the United States Government, who is the largest shareholder outside Africa, asked for an independent probe of those allegations.

The US treasury secretary questioned the integrity of the committee’s process as well as the internal processes of the bank.

Adesina, a few days ago, met with President Muhammadu Buhari, where he assured of the country’s support towards his travails and his second term bid for the Presidency of the multilateral institution.

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Business News

FG removes cap on petrol price, allows marketers to fix price

The price cap per liter in respect of Premium Motor Spirit (PMS) is removed from the commencement of these Regulations.

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Subsidy and PIB

The Federal Government has removed the cap on Premium Motor Spirit (PMS) price, popularly known as petrol.

This was disclosed by the Petroleum Products Pricing Regulatory Agency (PPPRA) via a memo, which was dated March 30, 2020, but realised on May 4, 2020, titled ‘Market Based  Pricing Regime for Premium Motor Spirit (PMS) Regulations, 2020.

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What it means: With the new development, marketers now have the freedom to fix the price of the commodity and sell above the price given by the agency.

Executive Secretary, PPPRA, Abdulkadir Saidu, explained that the agency would continue to monitor trends in the crude oil market and advise the Nigerian National Petroleum Corporation (NNPC) and oil marketers on the monthly guiding price for the commodity.

“The price cap per litre in respect of Premium Motor Spirit (PMS) is removed from the commencement of these Regulations. From the commencement of these Regulations, a market-based pricing regime for PMS shall take effect,” he said.

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Meanwhile, Nairametrics had reported that the agency announced a new retail price band for oil marketers.

In a circular dated May 31st, as seen by Nairametrics, the downstream regulator said oil marketers are now expected to sell petrol within the price range of N121.50 and N123.50. Part of the circular said:

“Please recall the recently approved pricing regime which became effective March 19, 2020, and the provision for the establishment of a monthly price band within which petroleum marketers are expected to sell PMS at the retail stations.”

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