The shares of Conoil plc, Nigerian Breweries plc, Guaranty Trust Bank plc, Lafarge Africa plc, and Stanbic IBTC Holdings plc led the pack of 26 gainers against 18 losers after yesterday’s trading on the floors of Nigerian Stock Exchange (NSE). The Nigerian stock market further appreciated by 0.51 percent or N53bn and pushed the Year-to- Date (YtD) return to -9.53 percent. Nigerian Stock Exchange All Share Index (ASI) closed at 31,355.28 points against the preceding day’s level of 31,195.93 points; while equities market capitalisation rose to N10.463trn against preceding level of N10.410trn. Conoil plc led other stocks on the gainers’ listed after its share price rose by N1.69, from N33.81 to N35.5; followed by Nigerian Breweries plc which rallied by N1.15, from N145.95 to N147.1. GTBank plc appreciated by N0.99, from N24.51 to N25.5; Lafarge Africa plc gained N0.98, from N89.02 to N90; while Stanbic IBTC plc gained N0.5, from N27.5 to N28.
“Although attractive valuation and fair prices will continue to encourage long term investors to take position, we expect investors with short term inclinations to begin to book profit given recent gains,” investment analysts at United Capital plc said yesterday. The volume of stocks traded at the nation’s bourse increased by 13.45 percent from 466.16 million recorded the preceding trading day to 528.86 million, while the total value of stocks traded rose by 5 percent from N5.04bn to N5.29bn in 4,955 deals. Brent crude futures dipped below $58 a bar- rel on Tuesday as oil market remained hobbled by oversupply and weak demand. Brent was down 79 cents at $57.74, while U.S. crude was 45 cents lower at $49.55.
Traders and analysts said there was a risk of further falls as speculative net long positions were so high, particularly in Brent, whilst the fundamental picture remained one of weakness with no sign of any slowdown in production. Mobil Oil Nigeria plc recorded the highest loss yesterday after its share price dropped by N3, from N153 to N150; followed by Beta Glass plc which lost N1.35, from N27.08 to N25.73.The share price of Ecobank Transnational Incorporated plc dropped from N18.48 to N17.83, after losing N0.65. International Breweries plc lost N0.47, from N19.42 to N18.95; while Union Bank of Nigeria plc dipped by N0.45, from N11.5 to N11.05.
The traded equities at the bourse include FBN Holdings plc, Diamond Bank plc, FCMB Group plc, MTI plc, and Zenith Bank plc. Equity dealers traded 123,562,186 units of FBN Holdings valued at N1.109bn; 59,317,652 units of Diamond Bank plc valued at N265.768m; 52,856,470 units of FCMB Group plc valued at N133.662m; 50 million units of MTI plc valued at N25m; and 37,388,916 units of Zenith Bank plc valued at N808.001m. Also at the NSE yesterday, Africa Prudential Registrars plc released its financial statements for the year ended December 31, 2014. Africa Prudential Registrars plc was listed on January, 17 2013. The group recorded growth in registrars’ fee income to N856.032m from N774.721m in financial year 2013. Net investment income rose to N1.349bn from N937.730m in 2013. The group’s profit before tax (PBT) rose to N1.300bn from N1.212bn in 2013 while the year profit rose to N1.218bn from N914.456 in 2013.
The groups’s basic earnings per share increased to 61kobo from 46kobo. The European Central Bank (ECB) announced plans to expand its Asset Purchase Programme (APP) to include a monthly purchase of euro-de- nominated investment- grade public-sector securities in the secondary market with effect from March 09, 2015. This is in addition to its asset-backed securities and covered bonds purchase which took effect from October 2014. According to research analysts at WSTC Financial Services, “Just as in the case of the recently concluded US Federal Reserve quantitative easing programme, we believe that this scenario will increase the flow of funds out of the single- currency bloc, as cheaper liquidity is expected to increase the risk appetite of institutional investors for high-yield currencies (mostly in emerging markets) that provide attractive risk-adjusted returns.” The analysts also believe that the APP will increase capital inflows to high-yield currencies like the Naira (and a couple of some other emerging market currencies that investors believe will deliver compelling risk-adjusted returns).
“The Nigerian equities market currently trades at a P/E ratio of 10.5x, lower than most of other emerging markets; Brazil – 13.8x; India – 20.3x; South Africa – 20.5x and Indonesia – 31.9x. We believe that attractive valuation in the Nigerian markets compared to its emerging market peers, and increasing stability in the foreign exchange market, presents attractive risk-adjusted return to institutional investors,” the research analysts said.
