Financial Markets Today

Financial Markets Today

Global equities market declined further today, with the U.S. Dow Jones Industrial Average (DJIA), S & P 500, NASDAQ, German DAX, London’s FTSE and Chinese SHANGHAI indices all shedding ca -0.12%, -0.15%, -0.45%, -0.60%, -0.31% and -0.99% respectively, day-on-day. This comes of the back of increasing negative impact of current rising global trade tensions, with the released of weaker than expected data from the world’s largest economies – U.S. and China. Data released by the U.S. Commerce Department showed retail sales grew ca +0.5% in May vs market analysts expectation of ca +0.6% with year-on-year inflation rising to 1.8% vs U.S. Federal Reserve Bank’s gauge of 2%. Chinese industrial output growth also slowed to its lowest in more than 17years at 5%, further raising investors’ fears of a sharper decline in global economic growth.

With increasing expectation of continued escalation of global trade tensions, particularly tensions between U.S. and China, we expect further negative impact on growth in both economies, as well as on global economic growth in 2019.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity opened positive today at ca ₦376.66bn, higher than ca ₦216.29bn recorded the previous day. The Central Bank of Nigeria (CBN) did not conduct an Open Market Operation (OMO) auction today.

Treasury Bills
The treasury bills secondary market ended the week on a bullish note today, on high positive interbank liquidity. There was demand on mid-to-long dated maturities, as average rates shed ca -6bps day-on-day, with the 26 December 2019 maturity closing at 11.88% from 11.89%.

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates remained relatively unchanged day-on-day at 5.29% and 5.71% from 5.43% and 5.71%. 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 quiet end to the week in the bonds secondary market today, with few transactions at the short and long end of the curve. Average yields shed ca -10bps day-on-day, with July 2021 maturity closing at 14.63% from 14.82%.

Eurobond

The nation’s Eurobonds market ended the week on a very quiet note today, with very few transactions across the curve. Average yields remained unchanged day-on-day, with the January 2049 maturity remaining at 8.70%.

Equities
The Nigerian equities market closed on a positive note today, after 9 consecutive trading days of decline, with the Nigerian Stock Exchange All Share Index (NSE ASI) marginally gaining ca +0.06% day-on-day to close at 30,046.70pts, and market’s year-to-date returns at -4.40%. This was largely due to marginal gains in Guaranty Trust Bank Plc (+0.65%) and Dangote Cement Plc (+0.55%).

The NSE Banking and Oil & Gas indices gained ca +23bps and +112bps respectively, while the Industrial and Consumer goods indices shed ca -21bps and -104bps respectively. Guaranty Trust Bank Plc led both the volume and value charts with 55.72mn units traded at ca ₦1.72bn.

The Naira remained flat against the dollar in both the interbank and parallel markets at ₦307/$1 and ₦361/$1 respectively. It also remained stable against the Pound sterling and Euro at ₦462/₤1 and ₦402/€1 respectively, in the parallel market. The FMDQ Nigerian Autonomous Foreign Exchange (NAFEX) Fixing rate remained flat day-on-day at ₦360.46/$1.

Crude oil prices remained elevated today, despite the International Energy Agency (IEA) cutting its oil demand forecast for 2019 by 100,000 barrels per day to 1.2m barrels per day due to worsening prospects for global economic growth and rising trade tensions. Brent crude oil price gained ca +0.93% day-on-day at $61.88pb, while WTI gained ca +0.34% day-on-day at $52.46pb, as at report time. Spot gold shed ca -0.0819% at $1,342.60 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
FO 29.40 2.65 +9.91%
UNITYBNK 0.70 0.06 +9.37%
ROYALEX 0.24 0.02 +9.09%
COURTVILLE 0.21 0.01 +5.00%
WEMABANK 0.62 0.02 +3.33%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
THOMASWY 0.33 -0.03 -8.33%
INTBREW 18.55 -1.45 -7.25%
JAIZBANK 0.46 -0.02 -4.17%
FIDELITYBK 1.68 -0.05 -2.89%
AFRIPRUD 3.40 -0.09 -2.58%
Benchmark T-Bills Discount Rates
14-Jun-19 13-Jun-19 Change in Rates
83 Days                                      . 11.03% 11.21% -0.18%
174 Days- 12.25% 12.26% -0.01%
349 Days. 12.13% 12.27% -0.14%
Source: FMDQ DQL for 14 June 2019
Benchmark FGN Bond Yields
14-Jun-19 13-Jun-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.63% 14.82% -0.19%
5 yrs: 15.54% 27-Apr 2023 14.31% 14.70% -0.3%
10 yrs: 13.98% 23-Feb 2028 14.71% 14.72% -0.01%
20 yrs: 16.25% 18-Apr 2037  . 14.60% 14.60% 0.00%
Source: FMDQ DQL for 14 June 2019
Benchmark FGN EuroBond Yields
14-Jun-19 13-Jun-19 Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21 4.73% 4.74% -0.01%
5 yrs: NGERIA 6 3/8 07/12/23 5.52% 5.53% -0.01%
10 yrs: NGERIA 6 1/2 11/28/27 7.25% 7.25% 0.00%
20 yrs: NGERIA 7.696 02/23/38 8.18% 8.18% 0.00%
30 yrs: NGERIA 9.248 01/21/49 8.70% 8.70% 0.00%
Source: FMDQ DQL for 14 June 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.17% 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 48 10.15% 10.29%
17-Oct-19 125 11.20% 11.65%
07-Nov-19 146 11.15% 11.67%
16-Jan-20 216 11.85% 12.74%
Select Macro-economic Indices
Inflation % (April 2019) 11.37 (+1.07% ytd)
PMI (May 2019) 57.80
MPR (%) 13.5 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 62.02 (+1.16% d/d)
External Reserve (US$’billion) 45.162 (+1.57% ytd)
GDP % (Q1 2019) +2.01% (Q4 2018: +2.38% y/y)
NSE All Share Index (ASI) 30,046.70 (+0.06% d/d; -4.40% ytd)
Market Capitalisation (₦’Trillion) 13.23

Financial Markets Update – 14 June 2019

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