Trading activities in Nigeria’s fixed income markets declined to its lowest in 2019, with only ca ₦73 billion worth of trades today vs ₦381 billion averaged daily year-to-date. This comes on the back of the postponement of the nation’s general elections at the week-end, by 1 week and can be attributed to a gradual rise in political uncertainties. However, sell-offs was more evident in the nation’s equities market, with major highly capitalized equities declining day-on-day and the Nigerian Stock Exchange All Share Index losing ca -1.61%.
We expect a subdued reaction by investors to the current political uncertainties, particularly as Brent crude oil price rises to its highest in 2019 at ca $66.44 per barrel and on better than expected GDP and inflation data released last week. However, further reaction from Foreign Portfolio Investors on the nation’s Eurobonds with the resumption of the U.S. capital markets after today’s bank-holiday.
Liquidity in the banking system was expected to open on a negative note today. There was an Open Market Operation (OMO) auction conducted by the Central Bank of Nigeria (CBN) today, closing with a no sale on all 3 maturities offered.
Continued quiet trading in the treasury bills secondary market today, with only few activities seen across the curve. The 09 May maturity traded the most to close at 12.62% from 12.36%, with average rate remaining relatively flat day-on-day. Pease find below the result of today’s Open Market Operation (OMO) auction:
|Amount Offered:||₦ 5.00billion||₦ 10.00billion||₦ 15.00 billion|
|Subscription:||₦ 3.15billion||₦ 10.57billion||₦ 114.05 billion|
|Amount Allotted:||No Sale||No Sale||No Sale|
|Range of bids:||11.9000% – 11.9000%||13.5000% – 13.5000%||15.0000% – 15.0000%|
Open Buy Back (OBB) and Overnight (O/N) rates rose to 23.33% and 26.08% from 15.83% and 17.50%. 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.
A very quiet trading day in the bonds secondary market today, with only a few trades seen across the curve. Average yield remained stable day-on-day, with the February 2028 maturity trading the most to close at 14.78%.
The Nigerian equities market declined today, after 2 consecutive trading days of gains, as the Nigerian Stock Exchange All Share Index (NSE ASI) lost ca -1.61% day-on-day to close at 32,190.07pts, with market’s year-to-date returns at +2.42%. This was largely on the back of price depreciation in Dangote Cement Plc (-0.36%), Nigerian Breweries Plc (-9.64%), Guaranty Trust Bank Plc (-3.82%) and Zenith Bank Plc (3.03%).
The NSE Oil & Gas, Industrial, Consumer Goods and Banking indices dropped ca -292bps, – 116bps, -154bps and -321bps respectively. Access Bank Plc led the volume chart with 25.32m units while Nestle Nigeria Plc led the value chart with ₦779bn worth of trade.
The Naira depreciated against the dollar at the interbank market window today, at ₦306.80/$1 from ₦306.75/$1. In the parallel market, it appreciated against the Dollar and Pound Sterling at ₦360/$2 and ₦470/₤1 from ₦362/$2 and ₦472/₤1 respectively, while it remained stable against the Euro at ₦411/€1. The Naira depreciated at the Nigerian Autonomous Foreign Exchange (NAFEX) window at ₦361.66/$1 from ₦361.54/$1.
Crude oil prices gained today, rising to its highest in 2019, on continued investors’ optimism of the positive impact of lower output from the Organisation of Petroleum Exporting Countries (OPEC) in January vs rising U.S. shale output. Brent crude oil price gained ca +0.29% at $66.44pb, while WTI crude rose ca +0.61% at $55.93pb, as at report time. Spot gold rose ca +0.55% day-on-day at $1,329.40 per ounce.
|AIICO Money Market Fund (AMMF)|
|Net Yield (As at current date)||13.28% per annum|
|Added Benefit||Personal accident insurance cover|
|AIICO Capital Guaranteed Income Note (GIN) Rates p.a.|
|Amount (NGN)||30 Days||60 Days||90 Days||180 Days||364 Days|
|10,000,001 – 50,000,000||10.00||10.50||11.00||12.00||13.00|
|50,000,001 – 100,000,000||11.00||11.25||11.50||12.50||14.00|
|100,000,001 – 400,000,000||12.00||12.25||12.50||13.00||14.50|
|Trading Treasury Bills Rates p.a.|
|Maturity Dates||Tenor (Days)||Discount Rate||Effective Yield|
|Select Macro-economic Indices|
|Inflation % (December 2018)||11.44 (-25.57% ytd)|
|PMI (January 2019)||58.50|
|MPR (%)||14 (-5%/+2% around mid-point)|
|Brent Crude Price US$ pbbl||66.44 (+0.29% d/d)|
|External Reserve (US$’billion)||42.86 (-0.59% ytd)|
|GDP % (Q4 2018)||+2.38% (Q3 2018: +1.81% y/y)|
|NSE All Share Index (ASI)||32,190.07 (-1.61% d/d; +2.42% ytd)|
|Market Capitalisation (₦’Trillion)||12.00|