All of us at AIICO Capital wish you all the Happiness in the New Year.
Global equities markets rallied today, with most benchmark indices closing in week-on-week gains despite a very volatile week of trading. This comes as the U.S. Treasury Secretary indicated possible progress in on-going U.S./China trade negotiations with a 2nd meeting between both parties early holding next week and comes a day after the European Central Bank (ECB) retained its benchmark refinancing rate at record low levels of 0%. The U.S. Down Jones Industrial Average (DJIA), S & P 500, NASDAQ, German DAX and Chinese SHANGHAI index all gained ca +0.94%, +0.97%, +1.24%, +1.36% and +0.36% respectively. Emerging Markets (EMs) equities also appreciated with the Morgan Stanley Capital International (MSCI) Emerging Market Index gaining ca 1.44% day-on-day.
We expect current positive momentum in global equities market to continue in the short term. However, we expect persisting uncertainties around global economy growth in 2019 with economic slowdown in China in Q4 2018 and rising expectation of further slowdown in Q1 2019 to stir increasing volatility in global financial markets and vulnerabilities in Emerging (EMs) and Frontier (FMs) markets
Banking system liquidity opened positive today, at ca ₦86.43bn. In line with its tight monetary policy, the Central Bank of Nigeria (CBN) conducted an Open Market Operation (OMO) auction today.
A relatively quiet trading day in the treasury bills secondary market today, with only a few transactions seen at the short-to-mid end of the curve. Average rate dropped ca -4ps day-on-day, with the 07 February and 21 March 2019 maturities trading the most to close at 12.72% and 11.13% respectively. Pease find below a summary of the results of today’s OMO auction:
|Amount Offered:||₦ 20.00billion||₦ 30.00billion||₦ 100.00billion|
|Subscription:||₦ 1.11billion||₦ 20.16billion||₦ 50.27billion|
|Amount Allotted:||₦ 1.11billion||₦ 20.16billion||₦ 50.27billion|
|Range of bids:||11.9000% – 11.9000%||13.5000% – 15.0000%||15.0000% – 15.0000%|
Open Buy Back (OBB) rate dropped to 12.08% from 12.33% while Overnight (O/N) rate remained flat at ca 13.00%. 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 7.50% for 30 – 60 days tenor on ₦10mln – ₦100mln
An active and bullish trading day in the bonds secondary market today, with interest seen particularly on long-dated maturities. Average yields dropped ca -3bps day-on-day, with the February 2028 maturity trading the most to close at 15.46% from 15.45%.
The Nigerian equities market appreciated today, as the Nigerian Stock Exchange All Share Index (NSE ASI) gained ca +0.36% day-on-day to close at 30,989.60pts, with market’s year-to-date returns at -1.40%. This was largely due price appreciation in Dangote Cement Plc (+1.04%), Guaranty Trust Bank Plc (+2.68%) and Zenith Banking Plc (+3.84%).
The NSE Oil & Gas, Banking and Industrial indices gained ca +168bps, +410bps and +49bps day-on-day, the NSE Consumer Goods index lost ca -14bps. Diamond Bank Plc led the volume chart with 89.76m units while Zenith Bank Plc led the value chart with trades worth ₦806mn.
The Naira remained stable against the dollar at the interbank market window today, at ₦306.80/$1. In the parallel market, it remained stable against the Dollar at ₦364/$1 while depreciating against both the Pound Sterling and Euro at ₦467/₤1 and ₦412/€1 from ₦463₤1 and ₦411/€1, respectively. The Naira appreciated at the Nigerian Autonomous Foreign Exchange (NAFEX) window at ₦362.12/$1 from ₦362.29/$1.
Crude oil prices rose further today, as investors continue to expect a shortage of output from Venezuela would help reduce current oversupply in global crude oil. Brent crude oil price rose ca +0.43% at $61.35pb, while WTI crude also rose ca +0.64% at $53.47pb, as at report time. Spot gold was down ca +1.55% day-on-day at $1,299.60 per ounce.
|AIICO Money Market Fund (AMMF)|
|Net Yield (As at current date)||13.00% per annum|
|Added Benefit||Personal accident insurance cover|
|AIICO Capital Guaranteed Income Note (GIN) Rates p.a.|
|Amount (NGN)||30 Days||60 Days||90 Days||180 Days||364 Days|
|10,000,001 – 50,000,000||10.00||10.50||11.00||12.00||13.00|
|50,000,001 – 100,000,000||11.00||11.25||11.50||12.50||14.00|
|100,000,001 – 400,000,000||12.00||12.25||12.50||13.00||14.50|
|Trading Treasury Bills Rates p.a.|
|Maturity Dates||Tenor (Days)||Discount Rate||Effective Yield|
|Select Macro-economic Indices|
|Inflation % (December 2018)||11.44 (-25.57% ytd)|
|PMI (December 2018)||61.10|
|MPR (%)||MPR (%) 14 (-5%/+2% around mid-point)|
|Brent Crude Price US$ pbbl||61.35 (+0.43% d/d)|
|External Reserve (US$’billion)||43.11 (-0.01% ytd)|
|GDP % (Q3 2018)||+1.81% (Q2 2018: +1.50% y/y)|
|NSE All Share Index (ASI)||31,426.63 (+1.41% d/d; -0.01% ytd)|
|Market Capitalisation (₦’Trillion)||11.72|