Financial Markets Today

Financial Markets Today

Nigerian economy expanded for the 8th consecutive quarter, with GDP growth of +2.01% year-on-year recorded for Q1 2019 vs +1.89% in Q1 2018, data released by the National Bureau of Statistics indicated today. The Economic growth was mainly attributed to growth in the non-oil sector, with growth of +2.47% year-on-year, while the oil sector declined for a 4th consecutive quarter, at -2.40% year-on-year vs +14.02% in Q1 2018. This comes as the 3rd Monetary Policy Committee (MPC) meeting of the Central Bank of Nigeria (CBN) of 2019 commenced today, with key considerations on recent reversal in headline inflation and escalating global trade tensions.

We expect the Monetary Policy Committee (MPC) to retain all key policy rates unchanged at the end of its meeting tomorrow, with the Central Bank of Nigeria buoyed by positive GDP data and possible short-term rise in headline inflation, expected to be more focused on further stimulating economic growth.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity opened positive today at ca ₦259.8bn marginally down from ca ₦297.74bn on Friday. The Central Bank of Nigeria (CBN) did not conduct an Open Market Operation (OMO) auction today.

Treasury Bills
The treasury bills secondary market kicked off the week on a bullish note today; as demand persisted on mid-to-long dated maturities. Average rates shed ca -6bps day-on-day, as rates recovered towards the end of the session to see the 26 December 2019 maturity closing at 11.13% from 11.68%.

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates marginally traded higher day-on-day at 5.00% and 5.71% from 4.57% and 5.29%. 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
The bonds secondary market kicked off the week on a quiet note today, with few transactions at the mid-to-long end of the curve. Average yields gained marginally ca +1bps day-on-day, with April 2037 maturity closing at 14.29%.

Eurobonds

The nation’s Eurobonds market kicked off the week with some buying interest today, as investors continue to cherry-pick elevated yields. Average yields trended downwards, shedding ca -5bps day-on-day with the February 2038 maturity closing at 7.99% from 8.01%.

Equities

The Nigerian equities market began the week on a positive note today, with the Nigerian Stock Exchange All Share Index (NSE ASI) gaining ca +1.74% day-on-day to close at 29,373.40pts, with the market’s year-to-date returns at -6.54%. This was mainly due to gains in Dangote Cement Plc (+1.14%) and MTN Nigeria Plc (+9.96).

The NSE Banking, Industrial and Oil & Gas indices all lost ca -108bps, -4bps and -111bps respectively, while the Consumer goods index gained +4bps. MTN Nigeria Plc led both the volume and value charts with 51.40m units traded at ₦6.16bn.

The Naira remained flat against the dollar in both the interbank and Parallel markets at ₦306.95/$1 and ₦361/$1 respectively. It also remained unchanged against the Pound sterling and the Euro at ₦471/₤1 and ₦404/€1 respectively, in the parallel market. The FMDQ Nigerian Autonomous Foreign Exchange (NAFEX) Fixing rate appreciated to ₦360.18/$1 from ₦360.23/$1.

Oil prices rose today, after OPEC and its allies signaled their intention to maintain current production-cuts beyond June 2019, and further escalation of on-going tensions between U.S. and Iran. Brent crude oil price gained ca +0.18% day-on-day at $72.33pb, while WTI gained ca +0.54% day-on-day at $63.06pb, as at report time. Spot gold gained ca +0.06% to close at $1,276.50 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Price Gain(N) % Change
MCNICHOLS 0.55 0.05 +10.00%
MTNN 119.75 10.85 +9.96%
THOMASWY 0.34 0.03 +9.68%
LIVESTOCK 0.70 0.06 +9.37%
LINKASSURE 0.48 0.04 +9.09%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
FO 25.55 -2.80 -9.88%
ETRANZACT 2.38 -0.26 -9.85%
NEIMETH 0.56 -0.05 -8.20%
STERLNBANK 2.30 -0.20 -8.00%
ACCESS 6.10 -0.35 -5.43%
Benchmark T-Bills Discount Rates
20-May-19 17-May-19 Change in Rates
80 Days 10.12% 10.04% 0.08%
171 Days 11.54% 11.37% 0.17%
332 Days. 11.63% 12.15% -0.52%
Source: FMDQ DQL for 20 May 2019
Benchmark FGN Bond Yields
20-May-19 17-May-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.41% 14.00% 0.41%
5 yrs: 15.54% 27-Apr 2023 14.32% 14.07% 0.25%
10 yrs: 13.98% 17 Mar 2028 14.23% 14.23% 0.00%
20 yrs: 16.25% 18-Apr 2037  . 14.29% 14.29% 0.00%
Source: FMDQ DQL for 20 May 2019
Benchmark FGN EuroBond Yields
20-May-19 17-May-19 Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21 4.81% 4.92% -0.11%
5 yrs: NGERIA 6 3/8 07/12/23 5.55% 5.64% -0.09%
10 yrs: NGERIA 6 1/2 11/28/27 6.97% 7.01% -0.04%
20 yrs: NGERIA 7.696 02/23/38 7.99% 8.01% -0.02%
30 yrs: NGERIA 9.248 01/21/49 8.56% 8.57% -0.01%
Source: FMDQ DQL for 20 May 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.32% 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 73 9.70% 9.89%
17-Oct-19 150 10.80% 11.30%
07-Nov-19 171 10.75% 11.32%
16-Jan-20 241 10.70% 11.51%
Select Macro-economic Indices
Inflation % (April 2019) 11.37 (+1.07% ytd)
PMI (April 2019) 57.70
MPR (%) 13.5 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 72.33 (+0.18% d/d)
External Reserve (US$’billion) 45.023 (+2.22% ytd)
GDP % (Q4 2018) +2.01% (Q3 2018: +2.38% y/y)
NSE All Share Index (ASI) 29,373.40 (+1.74% d/d; -6.54% ytd)
Market Capitalisation (₦’Trillion) 12.94

Financial Markets Update – 20 MAY 2019

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