Financial Markets Today

Financial Markets Today

Global financial markets remained on the edge and volatile today, with benchmark equity indices of major equity markets dropping ca – 0.50% to -4.40% on rising investors’ fears of a global economic slowdown in 2019. This comes after U.S. jobs data released today indicated a significant month-on-month drop in non-farm jobs added in February at 20,000 vs market analysts’ expectation of 180,000 and January’s figure of 304,000, and comes after earlier announcements by both the Chinese government and European Central Bank (ECB) of a reduction in their respective economic growth forecasts for 2019.

 

With continued investors uncertainties of U.S./China trade negotiations, expected slower economic growth in the world’s largest economies in 2019, and increasing expectation for Central Banks of developed economies to not raise benchmark interest rates in the near term, we expect continued rise in investors’ concerns of global growth and interest in safe-haven assets of developed economies to rise in the near term.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity remained positive today, opening at ca ₦319.06bn. There was an OMO auction conducted by the Central Bank of Nigeria (CBN) today.

Treasury Bills
A bearish trading day in the treasury bills secondary market today. Average rates rose ca +22%bps day-on-day, with the 09 May 2019 maturity trading the most to close at 10.75% from 9.00%. Please find below a summary of the results of the Open Market Operation (OMO) auction held today:

Tenor 100-Days 184-Days
Maturity Date: 13-Jun-19 05-Sep-19
Amount Offered: ₦ 50.00 billion ₦ 100.00 billion
Subscription: ₦ 28.58 billion ₦ 149.33 billion
Amount Allotted: ₦ 28.58 billion ₦ 140.58 billion
Range of bids: 11.8000% – 11.9000% 13.3400% – 13.4800%
Stop Rates 11.9000% 13.4500%

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates rose day-on-day to 9.17% and 10.08% from 8.50% and 9.58%. Average fixed deposit rates amongst banks monitored showed:
– tier-1 rated banks at 3.00% for 30 – 60 days tenor on ₦10mln – ₦100mln.
– tier-2 rated banks at 7.00% for 30 – 60 days tenor on ₦10mln – ₦100mln.

Bonds
A very active trading in the bonds secondary market today, with the market opening with some sell-offs across the curve, and demand seen towards the end of trading after the release of an adjusted Q1 Bond issuance calendar with a maximum ₦25bn on offer on the February 2028 maturity. Average yields gained ca +19bps day-on-day, with the March 2036 maturity trading the most to close at 14.33% from 14.16%.

Equities
The Nigerian equities market depreciated for a 3rd consecutive trading day, with the Nigerian Stock Exchange All Share Index (NSE ASI) losing ca -0.27% day-on-day to close at 31,924.51pts, with market’s year-to-date returns at +1.57%. This was largely due to price depreciation in Nigerian Breweries Plc (-4.03%) and Guaranty Trust Bank Plc (-0.93%).

The NSE Oil & Gas, Consumer Goods, Banking and Industrial indices all lost ca -97bps, -17bps, -13bps and -39bps respectively. Sovereign Trust Insurance Plc led the volume chart with 62.38m units while Zenith Bank Plc led the value chart with trades worth ₦1.163bn.

Crude oil prices declined today, on rising worried of a slowdown in growth in the world’s largest economy after government jobs data indicated only 20,000 jobs were added in February vs market analysts’ expectation of 180,000. Brent crude oil price lost ca -1.43% at $65.35pb, while WTI crude lost ca -1.55% at $55.78pb, as at report time. Spot gold gained ca +1.06% day-on-day at $1,299.80 per ounce.

Crude oil prices declined today, on rising worried of a slowdown in growth in the world’s largest economy after government jobs data indicated only 20,000 jobs were added in February vs market analysts’ expectation of 180,000. Brent crude oil price lost ca -1.43% at $65.35pb, while WTI crude lost ca -1.55% at $55.78pb, as at report time. Spot gold gained ca +1.06% day-on-day at $1,299.80 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
WAPIC 0.42 0.02 +5.00%
PZ 11.65 0.55 +4.95%
NPFMCRFBK 1.55 0.07 +4.73%
SOVRENINS 0.25 0.01 +4.17%
AFRIPRUD 4.80 0.19 +4.12%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
ACADEMY 0.36 -0.04 -10.00%
NEIMETH 0.64 -0.06 -8.57%
DANGFLOUR 10.45 -0.90 -7.93%
STERLNBANK 2.35 -0.13 -5.24%
NB 75.00 -3.15 -4.03%
Benchmark T-Bills Discount Rates
08-Mar-19 07-Mar-19 Change in Rates
83Days 11.01% 11.11% -0.10%
146Days 12.17% 12.05% 0.12%
335Days 13.14% 12.73% 0.41%
Source: FMDQ DQL for 08 March 2019
*T-Bills Discount Rates are slightly different from current market rates
Benchmark FGN Bond Yields
08-Mar-19 07-Mar-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.83% 14.83% 0.00%
5 yrs: 15.54% 27-Apr 2023 14.71% 14.71% 0.00%
10 yrs: 16.29% 17 Mar 2027 14.02% 14.27% -0.25%
20 yrs: 16.25% 18-Apr 2037 14.25% 14.13% 0.12%
Source: FMDQ DQL for 08 March 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.28% per annum
Added Benefit Personal accident insurance cover
AIICO Capital Guaranteed Income Note (GIN) Rates p.a.
Amount (NGN) 30 Days 60 Days 90 Days 180 Days 364 Days
10,000,001 – 50,000,000 10.00 10.50 11.00 12.00 13.00
50,000,001 – 100,000,000 11.00 11.25 11.50 12.50 14.00
100,000,001 – 400,000,000 12.00 12.25 12.50 13.00 14.50
Trading Treasury Bills Rates p.a.
Maturity Dates Tenor (Days) Discount Rate Effective Yield
01-Aug-19 146 10.70% 11.18%
17-Oct-19 223 12.60% 13.65%
07-Nov-19 244 12.65% 13.82%
16-Jan-20 314 12.30% 13.76%

 

Select Macro-economic Indices
Inflation % (January 2019) 11.37 (-0.61% ytd)
PMI (February 2019) 57.10
MPR (%) 14 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 65.35 (-1.43% d/d)
External Reserve (US$’billion) 42.32 (-1.86% ytd)
GDP % (Q4 2018) +2.38% (Q3 2018: +1.81% y/y)
NSE All Share Index (ASI) 31,924.51 (-0.27% d/d; +1.57% ytd)
Market Capitalisation (₦’Trillion) 11.91

Financial Markets Update – 08 March 2019

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