Financial Markets Today

Financial Markets Today

Global crude oil prices rose to its highest in 7-months today, with Brent crude oil price trading at year-to-date high of ca $72.2 per barrel, on the back of better-than-expected economic growth data from China, indicating a GDP growth of 6.4% in Q1 2019 vs analysts expectation of ca 6.2%. This also comes after months of consecutive cuts to crude oil output by the Organization of Petroleum Exporting Countries (OPEC) by ca 1.4 million barrels year-to-date, and increasing expectation of a U.S./China trade deal.

With expectation of deepening of supply cuts by the Organization of the Petroleum Exporting Countries (OPEC) and allies till the end of Q2 2019, further tightening of global supply by U.S. sanctions on OPEC members Venezuela and Iran, we expect oil prices to remain elevated through Q2 2019.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity opened negative today at ca -₦59bn from ca -₦47bn it opened at yesterday. There was no Open Market Operation (OMO) auction by the Central Bank of Nigeria (CBN) today.

Treasury Bills
A relatively quiet trading day in the treasury bills secondary market today, on the back of a negative interbank liquidity position. Some demand for long dated maturities was seen on the back of the low supply of the 1yr Treasury Bill maturity at today’s Primary Market Auction (PMA). The 02 April 2020 maturity traded the most to close at 12.73% from 12.87%. Please find below a summary if the results of today’s PMA:

Tenor 91-Days 182-Days 364-Days
Maturity Date: 18-Jul-19 17-Oct-19 16-Apr-20
Amount Offered: ₦ 5.849 billion ₦ 29.245 billion ₦ 23.396 billion
Subscription: ₦ 23.968 billion ₦ 37.686 billion ₦ 161.958 billion
Amount Allotted: ₦ 5.849 billion ₦ 3.500 billion ₦ 49.141 billion
Range of bids: 9.7000% – 13.5000% 11.8000% – 14.0000% 11.8500% – 15.0000%
Stop Rates 10.1499% 12.5000% 12.7400%

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates dropped marginally day-on-day to 15.71% and 16.57% from 16.14% from 17.43%. 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.

Bonds
Another quiet trading day in the bonds secondary market today, with few activities seen at the long end of the curve. Average yields shed ca -7bps day-on-day with the February 2028 maturity closing at 14.51% from 14.58%.

Eurobonds

There was demand across the curve in the nations Eurobonds market. Average yields shed -4bps day-on-day as the January 2049 maturity closed at 8.28% from 8.30%.

Equities
The Nigerian equities market closed positive today, with the Nigerian Stock Exchange All Share Index (NSE ASI) gaining ca +0.76% day-on-day to close at 29,970.86pts, and market’s year-to-date returns at -4.64%. This was majorly on the back of gains in Nestle Nigeria Plc (+5.31%).

The NSE Banking, Industrial and Oil & Gas indices all lost ca -25bps, -37bps and -140bps respectively while the Consumer Goods index gained ca +275bps. Access Bank Plc led the volume chart with 39.24m units while Nestle Nigeria Plc led the value chart at ca ₦1.47bn.

The Naira traded flat against the dollar in the interbank and parallel markets today at ₦306.95 and ₦360/$1 respectively. It was also stable against the Pound sterling at ₦475/₤1 and depreciated against the Euro at ₦405/€1 from ₦404/€1 in the parallel market. In the Nigerian Autonomous Foreign Exchange (NAFEX) window, the Naira depreciated marginally against the Dollar to close at ₦360.27/$1 from ₦360.18/$1.

Brent crude oil traded above $72 per barrel today, after the release of better than expected GDP growth data from China and data showing U.S. crude stockpiles declined last week. Brent crude oil price gained ca +0.07% day-on-day at $71.77pb, while WTI shed ca -0.06% day-on-day at $64.01pb, as at report time. Spot gold shed ca -0.06% to close at $1,276.40 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
ACCESS 6.65 0.60 +9.92%
CHAMS 0.36 0.03 +9.09%
FIRSTALUM 0.38 0.03 +8.57%
AGLEVENT 0.28 79.70 +7.69%
NESTLE 1580.00 0.14 +5.31%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
TRANSEXPR 0.74 -0.08 -9.76%
UAC-PROP 1.50 -0.16 -9.64%
ABCTRANS 0.33 -0.03 -8.33%
LEARNAFRCA 1.34 -0.12 -8.22%
WEMABANK 0.68 -0.04 -5.56%
Benchmark T-Bills Discount Rates
17-Apr-19 16-Apr-19 Change in Rates
64Days                                      . 11.57% 11.58% -0.01%
155Days- 13.06% 13.06% -0.02%
351Days. 12.87% 12.87% -0.14%
Source: FMDQ DQL for 17 April 2019
*T-Bills Discount Rates are slightly different from current market rates
Benchmark FGN Bond Yields
17-Apr-19 16-Apr-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.62% 14.62% 0.00%
5 yrs: 15.54% 27-Apr 2023 14.47% 14.45% 0.02%
10 yrs: 16.29% 17 Mar 2027 14.51% 14.58% -0.07%
20 yrs: 16.25% 18-Apr 2037  . 14.45% 14.45% 0.00%
Source: FMDQ DQL for 17 April 2019
Benchmark FGN EuroBond Yields
17-Apr-19 16-Apr-19 Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21 4.84% 4.90% -0.06
5 yrs: NGERIA 6 3/8 07/12/23 5.49% 5.53% -0.04%
10 yrs: NGERIA 6 1/2 11/28/27 6.66% 6.71% -0.05%
20 yrs: NGERIA 7.696 02/23/38 7.74% 7.78% -0.04%
30 yrs: NGERIA 9.248 01/21/49 8.28% 8.30% -0.02%
Source: FMDQ DQL for 17 April 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.39% 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-19 106 10.70% 11.04%
17-Oct-19 183 12.35% 13.17%
07-Nov-19 204 12.65% 13.61%
16-Jan-20 274 12.45% 13.73%
Select Macro-economic Indices
Inflation % (March 2019) 11.25 (-1.16% ytd)
PMI (March 2019) 57.40
MPR (%) 13.5 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 71.19 (+0.07% d/d)
External Reserve (US$’billion) 44.735 (+2.28% ytd)
GDP % (Q4 2018) +2.38% (Q3 2018: +1.81% y/y)
NSE All Share Index (ASI) 29,970.86 (+0.76% d/d; -4.64% ytd)
Market Capitalisation (₦’Trillion) 11.26

http://www.aiicocapital.com/wp-content/uploads/2019/05/Financial-Markets-Update-17-April-2019.pdf

This document has been issued and approved by AIICO Capital and is based on information from various sources that we believe are reliable. However, no representation is made that it is accurate or complete. While reasonable care has been taken in preparing this document, no responsibility or liability is accepted for errors or fact or for any opinion expressed herein. This document is for information purposes only. It does not constitute any offer or solicitation to any person to enter into any trading transaction.
Investments discussed in this report may not be suitable for all investors. This report is provided solely for the information of AIICO Capital clients who are then expected to make their own investment decisions. AIICO Capital conducts designated investment business with market counter parties and customers and this document is directed only to such persons. AIICO Capital accepts no liability whatsoever for any direct or consequential loss arising from any use of this report or its contents. This report is for private circulation only and may not be reproduced, distributed or published by any recipient for any purpose without prior express consent of AIICO Capital. Users of this report should bear in mind that investments can fluctuate in price and value. Past performance is not necessarily a guide to future performance.
AIICO Capital is regulated by the Securities and Exchange Commission, and is licensed to provide fund and portfolio management services in Nigeria.