Weakened appetite for equities buoy bonds

BY CHIOMA OBINAGWAM

ACTIVITIES at the bonds segment of the Nigerian capital market recorded a boost on the heels of weakened investors’ appetite for the equities market.

The weekly report of the Nigerian Stock Exchange (NSE) for the week ended November 4, 2016 revealed.

A bond is a debt investment in which an investor loans money to an entity (typically corporate or governmental) which borrows the funds for a defined period of time at a variable or fixed interest rate.

Specifically, the Federal Government (FG) bonds recorded a whopping 217.56 per cent increase in volume traded in the week under review, from a total of 4100 units of FG bonds valued at N4287 million transacted in 3 deals to a total 13,020 units of FG bonds valued at N12, 953 in 14 deals, where the value traded recorded a significant 202.15 per cent growth.

Consequently, equities stooped lower during the week, evident in its major indicators – Nigerian Stock Exchange (NSE) All-share index (ASI) and Market capitalisation shaving 1.15 per cent and 0.93 per cent to close at 26,981.60 and N9.288 trillion respectively.

Also traded during the week were a total of 56,688 units of Exchange Traded Products (ETPs) valued at N817,310.72 executed in 31 deals, compared with a total of 5.079 million units valued at N49.828 million transacted last week in 57 deals.

A summary of price changes in the review week shows that 24 equities gained in price during the week, higher than 21 of the previous week.

On the flipside, 37 equities lost in price, lower than 41 of the previous week, while 120 remained unchanged higher than 118 recorded in the preceding week.