Financial Markets Today

Financial Markets Today

U.S Treasury yields today dropped to 19-month low today, with the 10yr benchmark bond declining to ca 2.269%, its lowest since October 2017, on continued rising fears of further escalation of ongoing U.S./China trade tensions. This comes of the back of comments by the U.S. President – Donald Trump indicating the trade war between the world’s 2 largest economies would run for a long period, with possible substantial increase in current tariffs by the U.S. on Chinese imports, and further raising fears of a slowdown in global economic growth for 2019.

With the trade tension showing no impending end in the near term as both the U.S and China continue to hold off negotiations, we expect risk-off sentiments on global risk assets to persist, particularly in emerging markets and for continued rise in investors’ demand for safe haven assets in Developed Economies (DMs).





Banking system liquidity opened positive today at ca ₦155.9bn higher than ca ₦99.8bn recorded yesterday, as Banks had no major funding requirements. The Central Bank of Nigeria (CBN) did not conduct an Open Market Operation (OMO) auction today.

Treasury Bills
Another quiet session in the treasury bills secondary market today, with some sell offs at the long-end of the curve. Average rates marginally gained ca +1bps day-on-day, with the 29 August 2019 maturity trading the most to close at 10.80% from 10.78%. There will be a Primary Market Auction (PMA) on Thursday with ca ₦67.37bn Please find below our expectation for the auction:



1 30-May-19 91-Day 24,372,790,000.00 10.00% 10.50%-10.75%
2 30-May-19 182-Day 23,157,656,000.00  12.30% 11.75%-12.00%
3 30-May-19 364-Day 19,842,352,000.00 12.49% 11.90%-12.15%

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates traded lower day-on-day at 12.00% and 13.43% from 14.50% and 15.29%, with improved interbank liquidity. 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.

A quiet day in the bonds secondary market today, with very few transactions across the curve. Average yields marginally shed -2bps day-on-day, with July 2021 maturity closing at 14.43% from 14.44%.


A bearish trading session in the nation’s Eurobonds market today, with sell offs on most maturities as market continues to express risk off sentiments towards emerging markets on lingering U.S./China trade tensions. Average yields gained ca +3bps day-on-day with the January 2049 maturity closing flat at 8.70% from 8.67%.

The Nigerian equities market closed positive today, with the Nigerian Stock Exchange All Share Index (NSE ASI) gaining ca +3.68% day-on-day to close at 31,307pts, with the market’s year-to-date returns at -0.39%. This was largely due to gains in Zenith Bank Plc (+9.11%), Guaranty Trust Bank Plc (+5.43%) and Dangote Cement Plc (+5.00%).

The NSE Banking, Consumer goods, Industrial and Oil & Gas all gained ca +676bps, +224bps, +342bps and +397bps respectively. Guaranty Trust Bank Plc led both the volume and value charts with ca 67.12m units worth ₦2.14bn.

The Naira remained flat against the dollar in both the interbank and parallel markets at ₦306.90/$1 and ₦361/$1 respectively. It appreciated against the Euro at ₦403/€1 from ₦403/€1 but was stable against the Pound sterling at ₦465/₤1, in the parallel market. The FMDQ Nigerian Autonomous Foreign Exchange (NAFEX) Fixing rate depreciated day-on-day at ₦360.39/$1 from ₦360.38/$1.

Crude oil prices marginally gained today, despite lingering concerns that the escalating U.S./China trade tensions an expectation of its negative impact on crude oil demand in 2019. Brent crude oil price gained ca +0.27% day-on-day at $70.30pb, while WTI gained ca +0.74% day-on-day at $59.37pb, as at report time. Spot gold lost ca -0.483% at $1,277.40 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
ETI 12.10 1.10 +10.00%
UBA 6.25 0.55 +9.65%
COURTVILLE 0.23 0.02 +9.52%
ACCESS 6.35 0.55 +9.48%
UACN 6.95 0.60 +9.45%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
ETERNA 3.65 -0.35 -8.75%
PZ 8.10 -0.40 -4.71%
NAHCO 3.18 -0.12 -3.64%
FLOURMILL 13.35 -0.40 -2.91%
FIDELITYBK 1.77 -0.02 -1.12%
Benchmark T-Bills Discount Rates
28-May-19 27-May-19 Change in Rates
86 Days                                      . 11.17% 11.24% -0.07%
177 Days- 11.73% 11.67% 0.06%
338 Days. 11.55% 11.60% -0.05%
Source: FMDQ DQL for 28 April 2019
*T-Bills Discount Rates are slightly different from current market rates
Benchmark FGN Bond Yields
28-May-19 27-May-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.43% 14.44% -0.01%
5 yrs: 15.54% 27-Apr 2023 14.29% 14.36% -0.07%
10 yrs: 13.98% 17 Mar 2027 14.37% 14.25% 0.12%
20 yrs: 16.25% 18-Apr 2037  . 14.45% 14.45% 0.00%
Source: FMDQ DQL for 28 April 2019
Benchmark FGN EuroBond Yields
28-May-19 27-May-19 Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21 4.85% 4.83% 0.02%
5 yrs: NGERIA 6 3/8 07/12/23 5.58% 5.57% 0.01%
10 yrs: NGERIA 6 1/2 11/28/27 7.14% 7.09% 0.05%
20 yrs: NGERIA 7.696 02/23/38 8.14% 8.10% 0.04%
30 yrs: NGERIA 9.248 01/21/49 8.70% 8.67% 0.03%
Source: FMDQ DQL for 28 April 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.23% 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 65 9.25% 9.40%
17-Oct-19 142 11.35% 11.87%
07-Nov-19 163 11.30% 11.90%
16-Jan-20 233 11.40% 12.29%
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 70.30 (+0.27% d/d)
External Reserve (US$’billion) 45.068 (+2.12% ytd)
GDP % (Q4 2018) +2.01% (Q4 2018: +2.38% y/y)
NSE All Share Index (ASI) 31,307.00 (+3.68% d/d; -0.39% ytd)
Market Capitalisation (₦’Trillion) 13.79

Financial Markets Update – 28 MAY 2019

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