Abdul Zakariya August 29, 2015

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Philippa Paul
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1 Market Summary The All-Share Index declined 3.56 percent this week. Similarly, all the Indices finished lower during the week with the exception of the NSE ASeM Index that closed flat. Zenith International Bank Plc, United Bank for Africa Plc, and Access Bank Plc were the top three traded equities (measured by volume), accounting for 6.7 billion worth of shares, contributing 41.5 percent and 37.2 percent to the total equity turnover volume and value respectively. A total of 13 equities appreciated in price during the week, compared to 11 in the preceding week. Also, 65 equities depreciated in price, compared to 61 in the preceding week, while 112 equities remained unchanged, compared to 118 in the preceding week. News Nigeria s annual growth rate drops from 6.54 percent to 2.35 percent Nigeria's economic growth slowed sharply in the second quarter as lower crude prices took their toll on Africa's biggest economy and top oil producer. Annual growth dropped to 2.35 percent from 6.54 percent a year earlier, the Nigerian Bureau of Statistics (NBS) said late on Tuesday. Oil production fell to 2.05 million barrels per day from 2.21 million over the same period, the NBS said. With oil accounting for more than 90 percent of Nigeria's foreign exchange earnings and about 70 percent of government revenues, the fall in crude prices and output has hurt Nigeria's finances and its naira currency. Overnight lending rate spikes at 100 percent Nigerian overnight lending rate was quoted as high as 100 percent on Tuesday up from 40 percent the previous day on cash shortages, sending bond yields higher as commercial banks sold bonds to meet naira obligations, traders said. Interbank lending rates later fell sharply to 8.25 percent on average this week from 40 percent last week after budgetary allocations to government agencies on Thursday raised liquidity levels in the money market. StearsReport 1

2 NNPC ends contract with domestic refineries The Nigerian National Petroleum Corporation (NNPC) has cancelled its contract for the delivery of crude to the country's refineries in Warri, Port Harcourt and Kaduna, it said on Wednesday. Oil sales account for about 70 percent of government revenue in Nigeria, Africa's top crude producer, but the country imports most of the fuel used by its 170 million inhabitants because of its inefficient, ageing refineries. President Buhari appoints Chief of Staff President Muhammadu Buhari has appointed Alhaji Abba Kyari, who has held posts at United Bank for Africa, Unilever, and Mobil, as his chief of staff. Other appointments approved by the President are of Babachir David as the Secretary to the Government of the Federation; Col. Hameed Ibrahim Ali (retd.) as the new Comptroller-General, Nigerian Customs Service; Mr. Kure Martin Abeshi as the Comptroller-General, Nigerian Immigration Service; Senator Ita Enang as the Senior Special Assistant on National Assembly Matters (Senate) and Suleiman Kawu as SSA on National Assembly Matters (House of Representatives). Source: Punch & Reuters NSE launches Premium Board and introduces Premium Board Index In an attempt to promote Africa s biggest companies, as well as influence the economic growth and development of Nigeria, the Nigerian Stock Exchange launched a new listing platform the Premium Board and the associated Premium Board Index on Tuesday, August 25, The Board will feature companies that meet the Exchange s most stringent listing criteria of capitalization, governance and liquidity. It aims to provide a platform for greater global visibility for eligible African corporates to make it easier for them to attract global capital flows and reduce the cost of funding. The companies that have qualified for the Premium Board are Dangote Cement Plc, FBN Holdings and Zenith International Bank with market capitalisation of 2.87 trillion, billion and billion respectively. StearsReport 2

3 Index Movement Open Close Week to Month to Quarter to Year to NSE Premium Index NSE All-Share Index (ASI) NSE 30 Index NSE Banking Index NSE Insurance Index NSE Consumer Goods Index NSE Oil/Gas Index NSE Lotus II NSE Industrial Goods Index NSE ASeM Index NSE Pension Index 1, , % 2.85% 9.99% 13.11% 29, , % 4.52% 13.88% 16.86% 1, , % 5.13% 15.82% 17.25% 1, , % 0.21% 0.48% 0.47% 1, , % 5.63% 15.84% 17.85% % 9.56% 22.47% 18.75% % 3.76% 9.88% 13.47% % 3.84% 16.23% 21.87% % 1.55% 6.51% 9.35% 2, , % 5.19% 10.21% 10.80% 2, , % 3.18% 5.24% 0.62% StearsReport 3

4 Sector Update: Oil & Gas NNPC reduces crude off-takers to 16 The Nigerian National Petroleum Corporation (NNPC), has reduced the number of off-takers that will emerge after a competitive bid for the proposed 2015/16 crude oil term contract to 16 from 43, it said on Thursday. NNPC, which has been announcing a raft of measures aimed at rooting out corruption in Nigeria's oil sector, said it had extended invitations to Mobil and Forte Oil, in addition to an earlier published list, to bid for the new proposed offshore processing agreement. Shell reduces gas supplies to Bonny export terminal On Friday, Shell announced that gas supplies to Nigeria's LNG export terminal on Bonny Island had been reduced due to the shutdown of a major oil pipeline in the country caused by a leak and theft. The reduction may impact liquefied natural gas exports from the facility. Shell's Nigerian unit, Shell Petroleum Development Company (SPDC), on Thursday declared force majeure on crude oil exports via two major pipelines, including the Trans Nigeria Pipeline (TNP). The shutdown has led to a cut in gas being fed into the LNG export plant. Banking GT Bank considers issuing new Eurobond Nigeria's Guaranty Trust Bank (GT Bank) will redeem its existing Eurobond at maturity and consider issuing a fresh one, its chief executive said on Tuesday. Agbaje said he expected Nigeria to devalue its currency again by another 10 percent owing to the persistent decline in crude oil prices which have spooked foreign investors and prompted them to exit naira-denominated assets. StearsReport 4

5 Top Gainers Company Open Close Change DANGOTE SUGAR REFINERY PLC % SKYE BANK PLC % WEMA BANK PLC % FORTE OIL PLC % GUINNESS NIGERIA PLC % Top Losers Company Open Close Change P.Z. INDUSTRIES PLC % E-TRANZACT INTERNATIONAL PLC % CUTIX PLC % CAVERTON OFFSHORE SUPPORT GRP PLC % NESTLE FOODS NIGERIA PLC % StearsReport 5

6 Glossary Treasury Bills A short-term debt obligation backed by the government with a maturity of less than one year. Parallel Market An unofficial market in goods or currencies, especially in a country with a controlled economy. Interbank Lending Rate The rate of interest charged on short-term loans made between banks. Banks borrow and lend money in the interbank market in order to manage liquidity and meet the requirements placed on them. The interest rate charged depends on the availability of money in the market, on prevailing rates and on the specific terms of the contract, such as term length. Institutions Central Bank of Nigeria (CBN) Nigerian Stock Exchange (NSE) Nigerian National Petroleum Corporation (NNPC) Nigerian Bureau of Statistics (NBS) The CBN is responsible for the overall control and administration of the monetary and financial sector policies of the Federal Government. The CBN ensures monetary and price stability; issues legal tender currency in Nigeria; maintains external reserves to safeguard the international value of the legal tender currency; promotes a sound financial system in Nigeria; and acts as Banker and provide economic and financial advice to the Federal Government. The Nigerian Stock Exchange (NSE) is licensed under the Investments and Securities Act (ISA) and is regulated by the Securities and Exchange Commission (SEC) of Nigeria. It is an automated exchange that provides listing and trading services, as well as market data dissemination services, market indices, and much more. Through the Central Securities Clearing System Plc. (CSCS), an associate company, it is able to offer electronic clearing, settlement and delivery (CSD) services and custodian services. The Nigerian National Petroleum Corporation (NNPC) is the state oil corporation. In addition to its exploration activities, the Corporation is given powers and operational interests in refining, petrochemicals and products transportation as well as marketing. The Nigerian Bureau of Statistics coordinates Statistical Operations of the National Statistical System in the production of Official Statistics in all the Federal Ministries, Departments and Agencies (MDAs), State Statistical Agencies (SSAs) and Local Government Councils (LGCs) StearsReport 6

STOCK MARKET REPORT FOR OCTOBER 30 TH, 2015

STOCK MARKET REPORT FOR OCTOBER 30 TH, 2015 EQUITIES A turnover of 1.358 billion shares worth N14.722 billion in 14,772 deals were traded this week by investors on the floor of The Exchange in contrast