Crude oil prices appreciated today, rising ca 1% during trade as a Reuters Survey of crude oil output for February, indicated a 2nd consecutive month of decline in output from the Organisation of Petroleum Exporting Countries (OPEC). Crude oil output dropped to a 4-year low, dropping ca 300,000 barrels per day in February. This comes as trade negotiations between the world’s largest economies, U.S. and China appear close to deal that could reverse tariffs on ca $250 billion of imports from either countries. Yields on government treasuries in develop economies declined today, on increased investors’ interest after the Chinese government lowered its 2019 GDP growth rate forecast to 6% – 6.5%, lower than the 6.6% achieved in 2018, its slowest pace since 1990. The drop in the economic growth outlook for the world’s 2nd largest economy can be attributed to continued uncertainties of the U.S./China trade negotiations, with tariffs on ca $200 billion of Chinese exports to the U.S. still in place for most of Q1, with increasing negative impact on the Chinese economy.
We expect the continued negative impact of current U.S/China trade uncertainties on the Chinese economy will further spur new domestic stimulus by the Chinese government to improve domestic demand and economic activities in the world’s 2nd largest economy. We also expect this to further increase investors’ uncertainties of global growth in 2019.
Banking system liquidity opened on a positive note today, at ca ₦279.50bn. There was an Open Market Operation (OMO) auction conducted by the Central Bank of Nigeria (CBN) today.
A relatively quiet trading day in the treasury bills secondary market, with the Central Bank (CBN) conducting an Open Market Operation (OMO) auction. Average rates gained ca +24bps day-on-day, with the 05 September maturity trading the most to close at 12.97% from 11.95%. Please find below a summary of the results of the OMO auction held today:
|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%|
Open Buy Back (OBB) and Overnight (O/N) rates dropped day-on-day to 9.33% and 10.42% from 14.00% and 14.92%. 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.
A relatively more active trading day in the bonds secondary market today. Average yields rose ca +16bps day-on-day, with the February 2028 maturity trading the most to close at 14.28% from 13.96%.
The Nigerian equities market gained for a 3rd consecutive trading day, with the Nigerian Stock Exchange All Share Index (NSE ASI) gaining ca +0.14% day-on-day to close at 32,173.66pts, with market’s year-to-date returns at +2.36%. This was largely due to price gains in Guaranty Trust Bank Plc (+1.08%), Zenith Bank Plc (+0.82%) and Stanbic IBTC Holding Plc (+0.22%).
The NSE Consumer Goods and Banking indices both gained ca +25bps and +92bps respectively, while the NSE Oil & Gas and Industrial indices both lost ca -. Diamond Bank Plc led the volume chart with 119.79m units while Zenith Bank Plc led the value chart with trades worth .1.22bn.
The Naira remained stable against the dollar at the interbank market window today, at ₦306.90/$1. In the parallel market, it remained stable against the Dollar, Pound Sterling and Euro at ₦360/$1, ₦470/₤1 and ₦408/€1 respectively. The Naira depreciated at the Nigerian Autonomous Foreign Exchange (NAFEX) window at ₦360.84/$1 from ₦360.80/$1.
Crude oil prices declined marginally today, on reports of reopening of Libya’s biggest oil field after been shut down since December 2018. Brent crude oil price dropped ca -0.77% at $65.35pb, while WTI crude declined ca -0.88% at $56.06pb, as at report time. Spot gold gained ca +0.08% day-on-day at $1,288.60 per ounce.
|AIICO Money Market Fund (AMMF)|
|Net Yield (As at current date)||13.28% per annum|
|Added Benefit||Personal accident insurance cover|
|AIICO Capital Guaranteed Income Note (GIN) Rates p.a.|
|Amount (NGN)||30 Days||60 Days||90 Days||180 Days||364 Days|
|10,000,001 – 50,000,000||10.00||10.50||11.00||12.00||13.00|
|50,000,001 – 100,000,000||11.00||11.25||11.50||12.50||14.00|
|100,000,001 – 400,000,000||12.00||12.25||12.50||13.00||14.50|
|Trading Treasury Bills Rates p.a.|
|Maturity Dates||Tenor (Days)||Discount Rate||Effective Yield|
|Select Macro-economic Indices|
|Inflation % (January 2019)||11.37 (-0.61% ytd)|
|PMI (February 2019)||57.10|
|MPR (%)||14 (-5%/+2% around mid-point)|
|Brent Crude Price US$ pbbl||65.35 (-0.77% 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)||32,173.66 (+0.14% d/d; +2.36% ytd)|
|Market Capitalisation (₦’Trillion)||12.00|