The Nigerian stock market recorded marginal increase yesterday by 0.05 percent amid a slight decline in the price of crude at the international oil market. The Nigerian Stock Exchange (NSE) All Share Index (ASI) appreciated by 13 points to close at 30,614.93 points as against 30,601.13 points the preceding trading day. In 5,283 deals, equity dealers exchanged 381.290million units valued at N4.906bn.
The market capitalisation of listed equities declined from N10.210trn to N10.215trn, up marginally by N5bn. Year-to-Date (YtD) returns stood at -11.66 percent. Twenty-six stocks gained against 22 that lost. Stock that drove the market in the slight gain include Nestle Nigerian plc which rose by N5, from N815 to N820; Guinness Nigeria plc which rallied by N4, from N122 to N126; Flour Mill of Nigeria plc rose by N1.2, from N33.8 to N35; Lafarge Africa plc appreciated by N0.99, from N87 to N87.99; while International Breweries plc gained N0.97, from N18.5 to N19.47. Brent crude oil slipped towards $60 a barrel on Wednesday as a stronger dollar pressured commodity prices, while Saudi Arabia’s oil minister said he expected the market to balance itself and for prices to recover.
April Brent was down at $60.36 by 1405 GMT, after rising 2.5 percent on Tuesday at $60.84. U.S. crude futures were up 10 cents to $50.62 a barrel, narrowing their discount to Brent to less than $10 a barrel. Seplat Petroleum Development Company plc topped the losers’ table by N19.9, from N470 to N450.1; followed by Mobil Oil Nigeria plc which declined by N3, from N153 to N150. GTBank plc lost N1.01, from N24.01 to N23; PZ Cussons Nigeria plc lost N1, from N28.99 to N27.99; while Champion Breweries plc declined by N0.25, from N5.2 to N4.95. Debt Management Office (DMO) said on Wednesday it plans to raise N95bn (about $476m) by auctioning sovereign bonds with maturities ranging between 5 and 20 years on March 11, 2015.
The debt office said it will raise N35bn in 5-year bonds and N35bn each in the 10 and 20-year paper, using the Dutch auction system. All the bonds are reopenings of previous issues and the result of the auction is expected to be published on March 12, the DMO said. Debt-laden oil producer Afren plc has defaulted on its 2016 bonds after declining to make a $15m interest payment in order to preserve cash pending completion of a review of its capital structure.
The company said any restructuring or additional funding deal with bondholders could result in the issue of new equity, which would “substantially dilute the interests of the company’s current shareholders”. Afren’s shares fell as much as 50 percent in early trading on Wednesday on the London Stock Exchange (LSE). Afren, which has most of its oil fields in Nigeria, has lost more than 90 percent of its market value since the end of July, hit by a slump in oil prices, the dismissal of top executives and the absence of proven or probable reserves at a field in Iraqi Kurdistan. The interest payment on the 2016 notes had originally been due on February 1.
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The company was granted a 30-day grace period, which expired on Tuesday. While the non-payment would result in a default under the 2016 notes, Afren said it would have no immediate obligation to repay the notes. The non-payment will not result in any cross-default on its other debt facilities. Afren’s gross debt stood at about $1.15bn as of September 30, 2014.
