Market Closes Positive as MPC Embraces Flexibility

As investors awaited the outcome of the MPC meeting on Tuesday, trading across board was mostly cautious as marginal gains were offset by marginal losses until a mild rally that was recorded in market bellwethers in the final trading minutes ensured a positive close for the day. Consequently, the All Share Index rose 0.8% to settle at 27,231.50 points. Investors gained N74.0bn as market capitalisation rose to N9.4tn. Price appreciation in ETI (+3.2%), NIGERIAN BREWERIES (+1.8%) and DANGCEM (+1.8%) was the major driver of the performance today. Activity level further weakened as volume and value traded slid 13.4% and 19.4% to 274.1m units and N1.5bn respectively.

Insurance Index emerges Lone Loser
All sector indices appreciated, save for the Insurance index which slipped 0.4% due to losses in CONTINSURE (-3.7%). The Consumer good index chaired sector gainers, up 0.8% following a rally in NIGERIAN BREWERIES (+1.8%). Similarly, the Banking and Industrial goods indices improved 0.7% apiece on account of gains in ETI (+3.2%) and DANGCEM (+1.8%). In the same vein, the Oil & Gas index marginally rose 4bps on the back of gains in OANDO (+0.3%).

Negative Sentiments Persist
Sentiments in the market strengthened today and this was reflected in the market breadth which rose to 1.4x consequent on 25 stocks that appreciated while 18 declined. Gainers’ chart was topped by VITAFOAM (+7.0%), NAHCO (+4.8%) and FIDSON (+4.8%) while LEARNAFRCA (-9.4%), CAP (-5.0%) and CADBURY (-5.0%) were the worst performing stocks. Following the announcement of the MPC to introduce some level of flexibility into the Forex market, we expect market momentum to strengthen in sessions ahead.