FBN Securities Nigerian Market Wrap: 29 January 2015

The bears had the upper hand in the market today with increased foreign selling amid growing political and economic uncertainties. Financials were the worst hit as offers outstripped demand 3:1 in most names. Zenith(-4.99%) and Diamond(-4.81%) took a beating and both closed on net offer, the former having over 2mln shares at the day’s low. Diamond closed at N3.76, 35% off its 2014 rights price of N5.80. Guaranty dipped -4.31% intraday but subsequent value buying helped cut losses to -2.20%, there was decent support at N20 levels. Stanbic fell -3.70% on weak demand while Skye dropped -2.38% to close at a nine year low.

Consumer names were also skewed to the sell side, NB(-1.25%) and Nestle(-1.82%) were a major drag. PZ announced its Q2’15 results today, half year PBT and PAT declined by -36% and 37% respectively from last year following increased operating expenses. The stock fell -7.41% intraday however late aggressive buying towards the close erased and lifted it by +0.33%. The negative sentiment however spiraled to Flour mill (-5%). The industrial index was the sole gainer as decent buying in Wapco(+1.79%) and Ashakacem(+4.98%) offset weakness in Dangote Cement Nigeria (-0.32%). Other notable gainers were Dangsugar(+6.67%) which extended rally for the fifth consecutive session on local buying and FCMB(+3.96%) which was also lifted aggressively at the close. ETI(+1.25%) enjoyed decent patronage from offshore investors.

In summary, the market lost -0.89% on a big turnover of N11.9bln ($62m). As in recent sessions, block trades were rife in the market. There was another 400mln block trade in Oando at N18.00 ($37m) between two local firms, Max Air Limited bought while Ocean and Oil Development Partners sold. There was also block trades of 62mln ETI shares ($5.2m), 20mln cross in Guaranty ($2.17m) both by internationals and 49.5mln cross in Dangsugar ($1.5m)

Year-to-date (Ytd) loss increased to -14.47%, we expect the market direction to remain mixed in coming sessions.

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