Nigeria | NGX

The local bourse declined to end the week on a negative tone, posting a weekly loss of 0.1% in a tight trading week, even as the earnings season kicked off on a positive note. The benchmark All Share Index (ASI) closed at 37,947.2 points as YTD loss worsened to 5.8%, and market capitalisation fell by N24.5bn w/w to settled at N19.7tn. In terms of activity, average volume and value traded decreased by 16.6% and 19.2% w/w, respectively, to 201.7m shares and N2.2bn.

The global economy is projected to rebound by 6.0% in 2021, supported by the continued covid-19 vaccine rollout and dovish monetary stance. However, supply chain pressures, rising commodity prices and rapid domestic demand in major economies have intensified global inflation pressures.

The Nigerian Equities Market continued its downtrend into Q2 2021, as the NSE ASI declined further, down 2.91% to 37,907.28pts. As of the end of June 2021, the NGSE ASI index was down 5.87%. The bearish trend in H1 was driven largely by losses in the Industrials -8.02%, and Banks -6.76%. On the flipside, the Oil & Gas, Insurance, and the Consumer goods sectors were up 38.41%, 7.57% and 4.80% respectively in the period. Daily average value declined by...

In the Telecommunication Sector report 2020 (“A Transformative Past, Resilient Future”), we opined that the sector would remain resilient as the digital economy would boom during the lockdown. In line with our expectation, this sector powered the economy during the pandemic in 2020 as it grew the fastest by 15.9% y/y and accounted for 12.2% of the GDP. However, the sector is not at full power yet given weak broad-band penetration at 45.0% (although an improvement from previous year), and the huge prospects for mobile money under the right regulatory framework...

The Afrinvest weekly sentiments indicator weakened to 1.4x (from 1.9x). We anticipate a possible rebound in market performance this week, as investors position ahead of H1:2021 corporate releases and take advantage of cheap attractive stocks.

Trading in Guaranty Trust Bank shares was suspended on Friday in preparation for the delisting of the bank and subsequent listing of the new Holding Company (Holdco). According to the bank's management, GTBank is adjusting its operating model and service offerings to remain relevant in the financial services sector and position the bank for sustainable long-term growth given the increasing evolution of businesses across the globe.