Nigeria Market Watch | May 19th 2015: Nigerian equities market reversed its 4-Day uptrend

Lagos, Nigeria (Capital Markets in Africa):- The Nigerian Equities market reversed its 4-Day uptrend as the market slipped 21bps to close at 34,706.93 points. Today’s decline was against the backdrop of losses sustained in NIGERIAN BREWERIES (-1.9%), DANGOTE CEMENT (-0.3%) and WAPCO (-2.1%). Similarly, market capitalization eased N25.3bn to close at N11.8tn. Nevertheless, market activity strengthened as volume and value traded appreciated 16.9% and 39.3% to close at 357.2m units and N4.1bn respectively.

Mixed Sector Performance
The Insurance index led sector gainers, appreciating 0.4%, even as the Banking index rose 0.1% as ETI (+1.9%) and FBN HOLDINGS (+0.7%) rally. On the contrary, the Industrial Goods index dipped 1.0% on losses sustained in WAPCO (-2.1%) and DANGOTE CEMENT (-0.3%). The Consumer Goods Index and the Oil & Gas Index followed suit declining 0.6% apiece.

Market Breadth still Positive
Market Breadth (advancers/decliners ratio) however stayed positive (1.4x) as 35 stocks advanced against 25 decliners. The advancers’ list was led by BETA GLASS (+10.2%), SKYE BANK (+9.7%) and VONO (+8.9%) while CAVERTON (-9.5%), AG LEVENTIS (-4.9%) and PORTLAND PAINT (-4.7%) declined the most. The MPC concluded its third seating for the year today with all policy rates left unchanged save the Cash Reserve Requirement (CRR) which was harmonized to 31.0%. This was in contrast to the previous 20.0% on private sector deposit and 75.0% public sector deposit (35.0% effective rate as at February 2015). We expect the equities market to react positively to this, given its implied impact on interest income of banking tickers going forward.

Source: Afrinvest (West Africa) Limited Research Team.