Rally in Tier-1 Banks Buoys Market Performance

The performance of the Nigerian Equities market was positive today as investors interest in Tier-1 Banks lifted the All Share Index 0.5% to 25,373.42points, while YTD loss trimmed to -5.6%. Investors gained N42.6bn as market capitalisation rose to N8.8tn. The major drivers of the positive close were GUARANTY (+2.4%), NIGERIAN BREWERIES (+1.5%) and SEPLAT (+4.9%). Activity level was mixed as volume traded fell 1.8% to 254.7m units while value traded strengthened 4.8% to N2.5bn respectively.

ZENITH Releases Impressive Earnings
Performance across sectors was broadly positive as 3 indices trended northward (Oil & Gas, Banking and Consumer Goods) while the Insurance index declined 0.4% and the Industrial Goods index closed flat. The Oil & Gas index appreciated the most, up 1.7% as price appreciation in SEPLAT (+4.9%) buoyed the index. Similarly, the Banking index advanced 1.0% against the backdrop of gains in GUARANTY (+2.4%) and ZENITH (+0.5%) following the release of the latter’s largely impressive FY:2016 earnings result. ZENITH’s Gross Earnings advanced 17.4% Y-o-Y to N508.0bn while PAT rose 22.7% Y-o-Y to N129.7bn and a dividend of N1.77 was proposed for FY:2016 reporting period. The Consumer Goods index appreciated 0.7%.

Market Breadth Flat as Sentiment Remains Lukewarm
Despite the positive close, Investor sentiment stayed lukewarm as market breadth settled at 1.0x - 17 stocks advanced against 17 decliners. The best performing stocks today were HONYFLOUR (+5.0%), SEPLAT (+4.9%) and UACN (+3.2%) while 7UP (-6.1%), NPFMCRFBK (-5.1%) and CADBURY (-5.0%) declined the most. We expect market performance to be broadly determined by investors’ reaction to corporate scorecards of bellwethers due for release this week.

NASD OTC Exchange Market Activities
In the NASD OTC exchange, the total volume of trades settled at 702,503 units while total value stood at N90.2m. FRIESLAND WAMCO was the most traded stock, representing 92.1% and 92.6% of total volume and value traded respectively.