The Nigerian stock market was highly active last week as volume and value of trading rose by 762 per cent and 477 per cent respectively.
High trading in the shares of Wema Bank Plc Forte Oil Plc boosted trading volume and value to 7.476 billion shares worth N91.107 billion exchanged in 17,192 deals up from the 868.739 million shares valued at N15.792 billion in 12,201 deals the previous week.
However, the bearish trend was sustained as the Nigerian Stock Exchange (NSE) All-Share Index declined by 0.65 per cent to close lower at 29,851.29 while market capitalisation shed 59 per cent to be at N13.155 trillion.
This was the third consecutive decline the market is recording, thereby worsening the month-to-date and year-to-date to 3.39 per cent and 5.02 per cent in that order.
In terms of sectoral performance, the NSE Consumer Goods Index shed 1.6 per cent, followed by the NSE Industrial Goods Index that shed 1.5 per cent. On the positive side, the NSE Insurance Index led with 8.7 per cent, trailed by the NSE Banking Index with 2.6 per cent. The NSE Oil & Gas Index appreciated by 0.7 per cent.
Considering the fact that the decline recorded last week was lower than previous week’s and it was expected that the bulls would return to the market this week.
Commenting on the market performance, analysts at Cordros Capital Limited said: “We reiterate our view that the blend of a compelling valuation story, together with positive macroeconomic picture leaves scope for market recovery in the medium term. However, we guide investors to tread the cautious trading path in the short term.”
The capital market community last week explored opportunities in the Islamic finance in Nigeria. Decision-makers, regulators and investors came together in Lagos to exchange their views and experiences on those opportunities.
The forum featured a mix of panel sessions, onstage interviews and interactive sessions on a number of themes in Islamic finance including, Corporate Financing and Capital Raising in Nigeria; Funding Infrastructure and Social Welfare Requirements in West Africa and Islamic Finance, Investment, Banking and Takaful in Nigeria.
Speaking at the forum, the Chief Executive Officer, NSE, represented by the Divisional Head, Trading Business, NSE, Mr. Jude Chiemeka, applauded the federal government, the Debt Management Office, the Securities and Exchange Commission, the National Pension Commission for showing unwavering commitment to the deepening and growth of Islamic Finance in Nigeria.
“The Islamic finance sector presents numerous opportunities for enhancing the economic fortunes of Nigeria and the exchange will continue to work with market stakeholders to ensure the development of a robust Islamic finance sector. In 2016, for example, we developed and publicised our rules governing the listing of Sukuk and similar debt securities to provide regulatory guidance for issuers seeking to list their instruments on our platform.
“In line with the SEC’s non-Interest Capital Markets Product Master Plan, we have also identified five strategic pillars critical for the growth of the sector. These include a strong regulatory framework, capacity building, product development, robust primary and secondary markets, and market awareness programs such as these.
“We have already started executing on these pillars and recently hosted a training exercise for the market. We will also continue to provide an efficient and liquid market for investors and businesses in Africa, to save and access capital. We promise to continue our collaboration with all market stakeholders, to collectively contribute towards the enhancement of this new asset class, and ultimately towards the growing Islamic finance in Nigeria and Africa at large,” he said.
Some of the speakers at the event included Acting Director-General (DG) Securities and Exchange Commission (SEC), Ms Mary Uduk; Director-General, DMO, Ms Patience Oniha; Acting DG, National Pension Commission (Pencom), Hajia Aisha Dahir-Umar; Managing Director/CEO, Lotus Capital, Hajara Adeola among others.
But the Director General of Debt Management Office (DMO), said the federal government was perfecting arrangements to float another N100 billion Sukuk Bond to finance some infrastructure projects listed in the 2019 budget.
Sukuk are bonds structured to generate returns to ethical investors without infringing on the Islamic law which forbids interest payments.
Oniha said: “It represents an ownership interest in the asset to be financed rather than a debt obligation. It will be this year 2019 you God’s grace because the budget has been approved. The projects would be those included in the budget and the borrowing will also be what has been approved in the budget, part of new domestic borrowing. So, it will be this year.”
According to her, the second Sukuk bond (N100 billion Ijarah Sukuk) issued last December would be listed in July.
Meanwhile, an analysis of the activity chart showed that the Financial Services Industry led with 6.121 billion shares valued at N17.460 billion traded in 8,479 deals, thus contributing 81.87 per cent and 19.16 per cent to the total equity turnover volume and value respectively. The Oil & Gas Industry followed with 1.002 billion shares worth N65.058 billion in 2,019 deals. The third place was ICT Industry with a turnover of 115.320 million shares worth N3.387 billion in 866 deals. Trading in the top three equities namely, Wema Bank Plc, Forte Oil Plc and Zenith Bank Plc accounted for 6.573 billion shares worth N77.492 billion in 2,895 deals, contributing 87.91 per cent and 85.06 per cent to the total equity turnover volume and value respectively.
Also, a total of 662 units valued at N990,530.00 were traded last week in four deals compared with a total of 2,163 units valued at N354,065.06 that was transacted the previous week in six deals.
Similarly, a total of 21,682 units of Federal Government Bonds valued at N22.552 million were traded in 29 deals compared with a total of 235 units valued at N229,216.74 transacted two weeks in 14 deals
Price gainers and losers
The price movement chart showed that 34 equities appreciated in price during the week, higher than 19 in the previous week, while 33 equities depreciated in higher than 31 equities of the previous week.
Linkage Assurance Plc led the price gainers for the week with 37.5 per cent trailed by NEM Insurance Plc that gained 33.3 per cent. Thomas Wyatt Nigeria Plc garnered 21.2 per cent, while Lafarge Africa Plc chalked up 18.4 per cent.
Champion Breweries Plc gained 18.3 per cent just as Dangote Sugar Refinery Plc and Ecobank Transnational Incorporated rose 15.2 per cent.
Other top price gainers included: Glaxosmithkline Consumer Nigeria Plc (10 per cent); Law Union & Rock Insurance Plc (8.7 per cent) and Wema Bank Plc 8.0 per cent).
Conversely, Chams Plc led the price losers with 13.8 per cent, trailed by CAP Plc with 11.5 per cent. Okomu Oil Palm Plc, C & I Leasing Plc, Associated Bus Company Plc shed 10 per cent apiece. Ikeja Hotel Plc went down by 9.6 per cent, while Presco Plc lost nine per cent. Royal Exchange Plc and Livestock Feeds Plc depreciated by 8.3 per cent each.