Equities Market –
Following a three-session rout which saw the benchmark index plunge by 6.70% bidders came back into the market, in line with our view that moderate sell-offs will provide suitable entry points for some traders. The demand for stocks today help push the NSE ASI up 1.67% to 32,657.30 points while the year-to-date performance rose to 21.52%.

Sector performance breadth was positive as all but the insurance index posted gains. The insurance index edged down by 0.09% as the market offered the likes of MANSARD (-2.28%) and CONTINSURE (-1.57%); NEM, LINKASSURE and WAPIC rose by 7.37%, 4.92% and 4% respectively. On a positive note, the banking index rallied by 3.16%, lifted by interest in the likes of UBA (8.17%), DIAMONDBNK (6.19%), FIDELITYBK (5%), GUARANTY (4.35%), ACCESS (2.71%) and FCMB (2.52%). The industrial index added 1.08% off the back of gains in CUTIX (2.63%) and DANGCEM (2.25%). The consumer goods index rose by 0.84% with the notable gainers being INTBREW (4.98%), NB (1.73%), DANGFLOUR (1.66%), NESTLE (1.11%) and FLOURMILL (0.90%). The oil and gas index was up 0.40%, boosted by demand for the likes of FO (5%) and TOTAL (0.03%).

General market breadth was also positive as the session registered 26 gainers and 21 decliners. The top three gainers were UBA (8.17%), NEM (7.37%) and DIAMONDBNK (6.19%) while the top three losers were OKOMUOIL (-4.99%), JBERGER (-4.99%) and UNILEVER (-4.98%). Investors traded 386.24 million shares worth ₦3.30 billion.

We expect the market to trade in a narrow range (32,000-33,000 points) pre the Q2 earnings seasons as the major FX-driven move to the upside has played out for the most part. That said, the market expectation is that the Q2 earnings season will be strong and this could help lift to market to new highs for the year.

Money Market & Fixed Income –
The average inter-bank repo rate rose by 62bps to 13.12% as the CBN maintains tight control on liquidity to provide support to the Naira. The FGN debt market had a mixed session. The average bond yield was flat at 16.73% as most maturities ended the session unchanged. On the other hand, the average T-Bill yield contracted by 24bps to 19.80% as yields dropped across the bulk of the yield curve.

Foreign Currency –
The Naira depreciated by 0.02% against the US Dollar at the inter-bank market to ₦305.90/$. The CBN was set to sell $100 million in a special auction today and will comprise of spot and forward sales of up to 60-days. The proposed sale is a continuation of CBN policy to flood the market with US Dollars in its bid to boost trade and support the Naira, a policy that has been quite successful so far. At the I & E window, the Naira dropped 1.80% against the US Dollar to ₦368.67/$ as crude prices remain under pressure off the back of even more build-up on US crude inventories and rig counts. The Naira dropped 0.54% against the US Dollar at the parallel market and currently trades at ₦370/$.