Financial Markets Today

Price of risk assets in Developed Economies rallied today, on increased risk-off sentiments and investors’ demand for safe-haven assets. Price of gold in the international market gained ca +0.197% at $1424.40 per ounce while yields of government treasuries, which are inversely related to price trended downwards with the U.S. 10yr, Japanese 10yr and UK 10yr treasuries declined to +2.05%, -0.15% and +0.67%. This comes off the back of weaker-than-expected economic data in both the U.S. and Eurozone area, with U.S. Manufacturing Purchasing Managers Index (PMI) dropping to 50pts vs analyst expectation of 51pts, while the German PMI and French Business Growth data also dropping below market analysts expectation.

With the International Monetary Fund (IMF) cutting its expectation of global growth in 2019 for a 3rd time in 7 months as well as expectations of possible introduction of stimulus by European Central Bank (ECB) at the conclusion of its monetary policy meeting tomorrow, we expect investors to remain cautious in the near term, with increased interest in safe-haven assets.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Liquidity in the banking system opened on a positive note today at ca ₦25.59bn, up from a debit of ca -₦14.09bn yesterday. The Central Bank of Nigeria (CBN) did not conduct an Open Market Operation (OMO) auction today.

Treasury Bills
The treasury bills secondary market traded bearish sentiments today, as market saw sell offs on the short-to-mid end of the curve due to tight interbank liquidity. Average yields gained ca +34bps day-on-day as the 12 September 2019 maturity closed at 9.85% from 9.20%.

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates traded lower day-on-day at 15.86% and 16.43% from 16.71% and 17.86%. 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 opened with higher yields today, as market focus shifted to the primary auction (PMA). The Nigerian Debt Management Office (DMO) sold only ca 29% of the total subscription of ca ₦301 billion at today’s PMA, where it had offered a total of ₦145bn at the 5yr, 10yr and 30yr papers. Please find below details of
the auction results:

S/N	AUCTION DATE	MATURITY DATE	AMOUNT OFFERED (NGN)	AMOUNT ALLOTTED (NGN)	MARGINAL RATE
1	24-Jul-19	27-Apr-23	₦ 40.00 billion	₦ 28.193 billion	13.3500%
2	24-Jul-19	26-Apr-29	₦ 50.00 billion	₦ 7.226 billion	13.6400%
3	24-Jul-19	26-Apr-49	₦ 55.00 billion	₦ 51.404 billion	14.1200%

Eurobond

Bullish sentiments persisted in the nation’s Eurobonds market today, as market saw consistent demand for both corporate and sovereign instruments. Average yields lost -9bps day on day with the November 2027 paper closing at 6.01% from 6.14%.

Equities
The Nigerian equities market reversed previous day’s gain, with the Nigerian Stock Exchange All Share Index (NSE ASI) losing ca -0.20% day-on-day to close at 28,088.74pts, and market’s year-to-date returns at -10.63%. This was due to losses in Dangote Cement Plc (-0.57%), Guaranty Trust Bank Plc (-0.86%) and Nestle Nigeria Plc (-2.03%).

The NSE Oil & Gas and Consumer indices gained ca +451bps and +34bps, while the Banking & Industrial indices lost ca -20bps and -120bps respectively. Guaranty Trust Bank Plc led both the volume charts with ca 33.59m units traded at ca ₦971.44mn, for the 2nd consecutive day.

The Naira traded flat day-on-day against the dollar in the interbank and parallel markets to close at ₦306.90/$1 and ₦360/$1 respectively. In the parallel market, it traded flat against the Pound Sterling day-on-day closing at ₦455/₤1 while it depreciated against the Euro at ₦404/€1 from ₦403/€1. The FMDQ Nigerian Autonomous Foreign Exchange (NAFEX) Fixing rate depreciated day-on-day at ₦361.59/$1 from ₦361.51/$1.

Crude Oil prices rose today, after data from the Energy Information Administration (EIA) showed that U.S. crude oil stockpiles fell by 10.8 million barrels vs analysts expectation of ca 4 million barrels due to production disruptions caused by Hurricane Barry, in addition to tensions in the Iranian gulf. Brent crude oil price gained ca +0.42% day-on-day at $64.10pb, while WTI couldn’t hold onto its gains, marginally shedding ca -0.04% day-on-day at $56.75pb, as at report time. Spot gold gained ca +0.007% at $1,421.60 per ounce.

Top 5 Equitiy Advancers
Name (Symbol)	Closing Price	Gain(N)	% Change
JAPAULOIL	0.22	0.02	+10.00%
BOCGAS	5.07	0.46	+9.98%
CILEASING	5.00	0.45	+9.89%
SEPLAT	525.00	45.00	+9.38%
CHIPLC	0.30	0.02	+7.14%

Top 5 Equity Decliners
Name (Symbol)	Closing Price	Loss(N)	% Change
UNITYBNK	0.58	-0.06	-9.38%
VETBANK	3.36	-0.24	-6.67%
PRESTIGE	0.45	-0.03	-6.25%
SOVRENINS	0.20	-0.01	-4.76%
JAIZBANK	0.42	-0.02	-4.55%

Benchmark T-Bills Discount Rates
	24-Jul-19	23-Jul-19	Change in Rates
84 Days	10.33%	9.79%	0.54%
168 Days-	10.89%	10.31%	0.58%
322 Days.	11.10%	11.10%	0.00%
Source: FMDQ DQL for 24 July 2019

Benchmark FGN Bond Yields
	24-Jul-19	23-Jul-19	Change in Yield
3 yrs: 16.00% 15-Jul-2021	13.00%	13.51%	-0.41%
5 yrs: 15.54% 27-Apr 2023	13.43%	14.15%	0.26%
10 yrs: 13.98% 23-Feb 2028	13.77%	14.25%	0.13%
20 yrs: 16.25% 18-Apr 2037	13.99%	14.48%	0.05%
30 yrs: 14.80% 26-Apr 2049	14.10%	14.05%	0.05%
Source: FMDQ DQL for 24 July 2019

Benchmark FGN EuroBond Yields
	24-Jul-19	23-Jul-19	Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21	3.91%	3.98%	-0.07%
5 yrs: NGERIA 6 3/8 07/12/23	4.49%	4.55%	-0.06%
10 yrs: NGERIA 6 1/2 11/28/27	6.01%	6.14%	-0.13%
20 yrs: NGERIA 7.696 02/23/38	7.29%	7.37%	-0.08%
30 yrs: NGERIA 9.248 01/21/49	7.82%	7.89%	-0.07%
Source: FMDQ DQL for 24 July 2019

AIICO Money Market Fund (AMMF)
Net Yield (As at current date)	12.91% 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
26-Sep-19	64	9.40%	9.56%
31-Oct-19	99	9.50%	9.75%
16-Jan-20	176	10.15%	10.67%
28-May-20	309	10.20%	11.16%

Select Macro-economic Indices
Inflation % (June 2019)	11.22 (-0.18% ytd)
PMI (June 2019)	57.40
MPR (%)	13.5 (-5%/+2% around mid-point)
CRR (%)	22.5
Brent Crude Price US$ pbbl	64.10 (+0.42% d/d)
External Reserve (US$’billion)	45.087 (+1.38% ytd)
GDP % (Q1 2019)	+2.01% (Q4 2018: +2.38% y/y)
NSE All Share Index (ASI)	28,088.74 (-0.20% d/d; -10.63 ytd)
Market Capitalisation (₦’Trillion)	13.72