All of us at AIICO Capital wish you all the Happiness in the New Year.
Continued high volatility in global equities market today, on increased investors’ fears of a global economic slowdown in 2019 and the rising expectation of further slowdown in China’s economic growth. This comes as export data from China, the world’s 2nd largest economy, indicated a 4.4% decline in December, its largest month-on-month drop in 2years, while exports also dropped by ca 7.6%, its largest since July 2016. The U.S. Dow Jones Industrial Average (DJIA), S & P 500, NASDAQ, German DAX, London’s FTSE, French CAC and Chinese SHANGHAI indices all lost ca -0.36%, -0.53%, -0.94%, -0.29%, -0.91%, -0.39% and -0.75% respectively. The Morgan Stanley Capital International (MSCI) Emerging Market Index also declined ca -0.83% day-on-day.
With increasing global financial markets uncertainties and rising expectation of global economic slowdown in 2019, we expect this to negatively affect global crude oil demand and Brent crude oil prices in 2019, despite expected support from the implementation of production-cut agreement by the Organisation of Petroleum Exporting Countries (OPEC). We also expect this to negatively impact economic growth in Emerging (EMs) and Frontier (FMs) markets in Q1 2019, particularly commodity dependent countries like Nigeria.
Banking system liquidity opened on a negative note today, at ca -₦131.65bn. The Central Bank of Nigeria (CBN) conducted an Open Market Operations (OMO) today to further tighten system liquidity.
A relatively quiet trading day in the treasury bills secondary market today. Average rate dropped ca -3bps day-on-day, with the 19 September 2019 maturity trading the most to close at 14.63% from 14.89%. Please find below the results of the Open Market Operations (OMO) auction held today:
|Maturity Date:||18-Apr-19||18-Jul -19||02-Jan-20|
|Amount Offered:||₦ 10.00 billion||₦ 10.00 billion||₦ 30.00 billion|
|Subscription:||₦ 4.47 billion||₦ 1.13 billion||₦ 19.54 billion|
|Amount Allotted:||₦ 4.47 billion||₦ 1.13 billion||₦ 19.54 billion|
|Range of bids:||11.8000% – 11.9000%||13.5000% – 15.0000%||15.0000% – 15.0000%|
Open Buy Back (OBB) and Overnight (O/N) rates rose to 31.67% and 35.25% from 22.00% and 22.50% respectively. 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 8.00% for 30 – 60 days tenor on ₦10mln – ₦100mln.
A very quiet trading day in the bonds secondary market today. Average yields gained ca +17bps day-on-day, with the February 2028 maturity trading the most to close at 15.54%.
The Nigerian equities market appreciated for a 3rd consecutive trading day, as the Nigerian Stock Exchange All Share Index (NSE ASI) gained ca +0.45% day-on-day to close at 29,964.79pts, with market’s year-to-date returns at -4.66%. This was due to price appreciation in Dangote Cement Plc (+1.69%).
The NSE Banking, Consumer Goods and Oil and Gas indices lost ca -8bps, -7bps and -27bps respectively, while NSE Industrial index gained ca +108bps. Diamond Bank Plc led the volume chart with 50.10m units while Zenith Bank Plc led the value chart with trades worth ₦268.61mn.
The Naira appreciated against the dollar at the interbank market window today, at ₦306.85/$1 from ₦306.90/$1. In the parallel market, it appreciated against the Dollar at ₦362/$1 from ₦363/$1, while it depreciated against both the Pound Sterling and Euro at ₦462/₤1 and ₦412/€1 from ₦460/₤1 and ₦410/€1, respectively. The Naira appreciated at the Nigerian Autonomous Foreign Exchange (NAFEX) window at ₦364.41/$1 from ₦364.72/$1.
Crude oil prices declined further today, dropping below the $60 per barrel on growing fears of global economic slowdown after import and export data from China indicated further weakening in the world’s 2nd largest economy. Brent crude oil price lost ca -1.19% at $59.28pb, while WTI crude was down ca -1.57% at $50.78pb, as at report time. Spot gold gained ca +0.18% day-on-day at $1,291.80 per ounce.
|AIICO Money Market Fund (AMMF)|
|Net Yield (As at current date)||12.98% per annum|
|Added Benefit||Personal accident insurance cover|
|AIICO Capital Guaranteed Income Note (GIN) Rates p.a.|
|Amount (NGN)||30 Days||60 Days||90 Days||180 Days||364 Days|
|10,000,001 – 50,000,000||10.00||10.50||11.00||12.00||13.00|
|50,000,001 – 100,000,000||11.00||11.25||11.50||12.50||14.00|
|100,000,001 – 400,000,000||12.00||12.25||12.50||13.00||14.50|
|Trading Treasury Bills Rates p.a.|
|Maturity Dates||Tenor (Days)||Discount Rate||Effective Yield|
|Select Macro-economic Indices|
|Inflation % (November 2018)||11.28 (-26.61% ytd)|
|PMI (December 2018)||61.10|
|MPR (%)||MPR (%) 14 (-5%/+2% around mid-point)|
|Brent Crude Price US$ pbbl||59.28 (-1.19% d/d)|
|External Reserve (US$’bi l l ion)||43.05 (-0.16% ytd)|
|GDP % (Q3 2018)||+1.81% (Q2 2018: +1.50% y/y)|
|NSE Al l Share Index (ASI)||29,964.79 (+0.45% d/d; -4.66% ytd)|
|Market Capi tal i s ati on (₦’Tri l l i on)||11.17|