Financial Markets Today

Financial Markets Today

Global financial markets rallied today, on rising optimism of U.S. and China closing on a trade deal as the U.S. President – Donald Trump, indicated a possible push back of deadline date if both sides were close to reaching a trade deal before the deadline date. The U.S. Dow Jones Industrial Average (DJIA), S & P 500, NASDAQ, German DAX, London’s FTSE and Chinese SHANGHAI indices gained ca +0.25%, +0.17%, +0.13%, +0.37%, +0.81% and +1.84% respectively. Crude oil prices also gained with Brent crude oil price rising ca 2% day-on-day
at ca $63.99 per barrel.

We expect global financial markets to remain volatile in the near term on continued expectation of slowdown in global economic growth, despite current optimistic sentiments of U.S./China trade negotiations.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity was expected to open on a negative note today. There was Open Market Operation (OMO) auction conducted by the Central Bank of Nigeria (CBN) today.

Treasury Bills
The bearish trend from yesterday continued in the treasury bills secondary market today. Sell-offs was seen particularly on short-dated maturities, with average rate gaining ca +5bps day-on-day. The 28 February maturity traded the most to close at 10.27%. Please find below a summary of the results of today’s Primary Market Auction (PMA):

Tenor 91-Days 182-Days 364-Days
Maturity Date: 02-May-19 01-Aug-19 30-Jan-20
Amount Offered: ₦ 3.384billion ₦ 10.000billion ₦ 140.000 billion
Subscription: ₦ 11.577 billion ₦ 22.114billion ₦ 404.892billion
Amount Allotted: ₦ 3.384 billion ₦ 10.000 billion ₦ 140.000 billion
Range of bids: 10.8000% – 12.5000% 12.0000% – 13.5000% 14.8000% – 16.5237%
Stop Rates 10.9700% 13.4000% 14.9500%

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates dropped to 20.00% and 23.17% from 24.17% and 27.50%. Average fixed deposit rates amongst banks monitored showed:
– tier-1 rated banks at 3.50% for 30 – 60 days tenor on ₦10mln – ₦100mln.
– tier-2 rated banks at 8.00% for 30 – 60 days tenor on ₦10mln – ₦100mln.

Bonds
A very quiet trading day in the bonds secondary market today, with activities seen at the mid-end of the curve. Average yield gained ca +44bps day-on-day with the March 2024 maturity trading the most to close at 14.59%.

Equities
The Nigerian equities market declined today, after 8 consecutive trading days, as the Nigerian Stock Exchange All Share Index (NSE ASI) lost ca -0.15% day-on-day to close at 32,413.92pts, with market’s year-to-date returns at +3.13%. This was majorly due to depreciation in prices of Guaranty Trust Bank Plc (-2.57%) and Zenith Bank Plc (-0.40%).

The NSE Oil & Gas and Banking indices lost ca -224bps and -179bps respectively, while the NSE Industrial and Consumer Goods indices gained ca +161bps and +89bps. Diamond Bank Plc led the volume chart with 131m units while Zenith Bank Plc led the value chart with ₦1.10bn worth of trade.

The Naira remained stable against the dollar at the interbank market window today, at ₦306.75/$1. In the parallel market, it also remained stable against the Dollar, Pound Sterling and Euro at ₦361/$1, ₦473/₤1 and ₦411/€1 respectively. The Naira depreciated at the Nigerian Autonomous Foreign Exchange (NAFEX) window at ₦361.58/$1 from ₦361.38/$1.

Crude oil prices gained further today, on continued positive impact of yesterday’s reports of output cuts by the Organisation of Exporting Countries (OPEC) in January, despite rising U.S. stockpiles. Brent crude oil price gained ca +1.99% at $63.66pb, while WTI crude rose ca +2.03% at $54.18pb, as at report time. Spot gold rose ca +0.09% day-on-day at $1,315.20 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
BERGER 8.25 0.75 +10.00%
UNILEVER 44.00 4.00 +10.00%
UNITYBNK 1.04 0.09 +9.47%
LIVESTOCK 0.60 0.05 +9.09%
JAIZBANK 0.60 0.05 +9.09%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
CILEASING 7.33 -0.81 -9.95%
CHAMPION 1.61 -0.17 -9.55%
PZ 12.00 -1.25 -9.43%
UCAP 3.20 -0.32 -9.09%
CHIPLC 0.26 -0.02 -7.14%
Benchmark T-Bills Discount Rates
13-Feb-19 12-Feb-19 Change in Rates
78Days 11.30% 11.10% 0.20%
169Days 12.50% 13.35% -0.85%
302Days 14.84% 14.88% -0.04%
Source: FMDQ DQL for 13 February 2019
*T-Bills Discount Rates are slightly different from current market rates
Benchmark FGN Bond Yields
13-Feb-19 12-Jan-19 Change in Yield
3 yrs: 16.00% 29-Jun 2019 12.89% 13.40% -0.51%
5 yrs: 15.54% 13-Feb 2020 16.80% 15.33% 1.47%
10 yrs: 16.29% 17 Mar 2027 14.73% 14.79% -0.06%
20 yrs: 16.25% 18-Apr 2037 14.50% 14.53% -0.03%
Source: FMDQ DQL for 13 February 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.22% 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
14-Mar-19 29 10.20% 10.28%
09-May-19 85 11.55% 11.87%
01-Aug-19 169 12.20% 12.93%
07-Nov-19 267 14.35% 16.03%

 

Select Macro-economic Indices
Inflation % (December 2018) 11.44 (-25.57% ytd)
PMI (January 2019) 58.50
MPR (%) 14 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 63.66 (+1.99% d/d)
External Reserve (US$’billion) 42.91 (-0.48% ytd)
GDP % (Q4 2018) +2.38% (Q3 2018: +1.81% y/y)
NSE All Share Index (ASI) 32,413.92 (-0.15% d/d; +3.13% ytd)
Market Capitalisation (₦’Trillion) 12.09

 

Financial Markets Update – 13 February 2019

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