Global Market Rallies on Potential COVID-19 Vaccine

The total number of COVID-19 cases surpassed 50.0 million this week, settling at 51.8 million while the death toll rose 3.9% to 1.3 million. With the US remaining the epicenter of the virus with 10.1 million confirmed cases, trailed by India (8.7m) and Brazil (5.7m). Also, ICU capacity across the globe are reaching limit prompting countries to impose another lockdown to curb the pandemic. Meanwhile, positive signs surrounding a potential vaccine from Pfizer & BioNTech and Moderna spurred a glimpse of hope, reducing uncertainty.

Bulls Extend Lead at the Exchange

The stock market remained upbeat on Tuesday as the All-Share index advanced 1.3% to settle at 32,647.10 points due to gains in MTNN (+4.1%), STANBIC (+4.4%) and ZENITH (+2.3%). Consequently, market capitalisation rose ₦211.1bn to ₦17.1tn while YTD return improved to 20.6%. Activity level decreased as volume and value traded declined by 9.0% and 6.1% to 578.8m units and ₦7.7bn respectively. The most traded stocks by volume were ZENITH (67.9m units), FBNH (64.7m units) and ACCESS (60.2m units) while ZENITH (₦1.6bn), GUARANTY (₦1.2bn) and DANGCEM (₦556.3m) led by value .

Bonds Market: Investors Remain Bullish in the Domestic Market

Investor sentiment remained strong in the local bonds market as average yield declined 16bps to close the week at 4.1%. Across tenors, the short-dated instrument recorded the best performance as average yield slid 41bps. Similarly, the long-tenor bonds declined 13bps w/w while average yield in  the medium-term segment fell 8bps w/w. Overall, 17 of the 20 instruments that we cover recorded  a bullish performance over the week. The FGN 2022 and FGN 2023 instruments were the best performing bonds, with their respective yields falling 78bps and 55bps w/w to 2.4% and 2.6%.

Domestic Equities Market: Improved Earnings Buoy Performance

The domestic equities market sustained its bullish momentum on the back of positive sentiment surrounding Q3 earnings results. The market gained on all trading days and performance was driven by buying interest in NESTLE (+21.0%), BUACEMENT (+11.2%) and DANGCEM (+6.0%). As a result, the NSE All-Share Index posted a gain of 6.4% w/w, crossing the psychological benchmark of 30,000 points to settle at 30,530.69 points. Similarly, YTD return improved to 13.7% and market capitalisation rose ₦958.4bn w/w to close at ₦16.0tn.

Domestic Equities Market: The Bulls Remain Resilient

The equities market sustained last week’s positive performance as investors ignored the violence and unrest in the country and positioned ahead of the release of Q3 earnings. The local bourse recorded gains on 3 of the 5 trading sessions and as a result, the All-Share index increased 13bps w/w to 28,697.06 points. Furthermore, investors gained ₦19.7bn as market capitalisation rose to ₦15.0tn while YTD return improved to 6.9%. Activity level fell as average volume and value traded declined 23.0% and 14.4% to 301.1m units and ₦3.9bn respectively.

Domestic Equities Market: The Bulls Dominate Trade

This past week, interest in the local equities market remained strong. Investors were attracted by the currently low market valuation amidst the continued low yield environment in the fixed income space. The performance also reflects an improvement in risk appetite despite looming uncertainty surrounding the business terrain due to the pandemic. Furthermore, trading opened the week positive on Monday (+2.1%) while Tuesday was met with a whopping 4.9% gain (the highest on record since April 2015), due to buying interest in DANGCEM, MTNN and ZENITH.

Bonds Market: Domestic Bond Market Extended Bullish Run

This week, the bullish sentiments in the bond market was sustained as average yield continued to dwindle, down 37bps to 6.3%. The trading session kicked-off on Monday with average yield rising 3bps following sell-offs on short tenor bonds. However, the market closed on a positive on the remaining trading days. Across tenors, the medium-term instruments recorded the most buying interest with the average yield down 63bps w/w. Similarly, average yield on the long and short-term instruments declined 18bps apiece w/w.

Profit-taking Halts 12-day Rally in Equities Market

Profit-taking activities dominated the stock market today, following 12 consecutive days of gains as the All-Share index inched lower by 95bps to 28,634.35 points. Sell pressures in bellwethers - MTNN (-1.5%), ZENITH (-6.0%) and GUARANTY (-1.6%) - were the key drivers of today's performance. Investors lost ₦143.7bn as market capitalisation declined to ₦15.0tn while YTD return weakened to 6.7%. Activity level remained strong as volume and value traded rose by 11.1% and 0.4% to 832.9m units and ₦9.5bn respectively.

Global Equities Market: Positive Sentiments on Additional Fiscal Stimulus

Last week, COVID-19 cases increased 5.2% to 33.8 million while total deaths surpassed the million mark, increasing 3.1% to 1.0 million. Globally, the US (7.1 million), India (6.3 million) and Brazil (4.8 million) have the most confirmed cases. As the second wave of the virus is spreading, countries are imposing fresh lockdowns and stricter measures. In the US, House Democrats passed a $2.2tn fiscal stimulus package to support the economy. However, this is unlikely to receive support in the Senate, prompting further negotiations with the Treasury Secretary, Steve Mnuchin.