Financial Markets Today

Financial Markets Today

Crude oil prices rose to their highest since November 2018, with Brent crude oil price rising to its year-to-date high today, at ca $71.08 per barrel, supported by expectation of a supply shock from Libya, on current eruption of a civil war and potential political crisis in the member of the Organisation of Petroleum Exporting Countries (OPEC). This comes after last Friday’s release of stronger-than-expected economic jobs data from the U.S. and rising expectation of a U.S./China trade deal spurred gains in crude oil prices, and is expected to further reduce output from OPEC in April by ca 400,000 barrels per day.

 

With expected positive sentiments of an improvement to global crude oil demand on recent positive economic data from both the U.S. and China, and expectation of reduced global crude oil output with OPEC expected to significantly lower crude oil supply in till its next annual general meeting at the end of June 2019, we expect Brent crude oil price to remain elevated for most of Q2, ranging ca $68 – $75 per barrel.

MONEY MARKETS

CAPITAL MARKETS

FOREIGN EXCHANGE

COMMODITIES

Banking system liquidity was expected to open positive today. There was no Open Market Operation (OMO) auction today by the Central Bank of Nigeria (CBN).

Treasury Bills
The treasury bills secondary market kicked off the week on a rather quiet note with most activities on mid-to-long dated maturities. Average yields gained +2bps day-on-day with activity concentration on the 8th August Maturity which closed at 12.28% from 12.06%.

Bank Placements
Open Buy Back (OBB) and Overnight (O/N) rates rose day-on-day to 16.57% and 17.43% from 5.00% and 5.57%, respectively. 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 with some demand on the short-to-mid dated maturities. March 2024 was the most active as it shed ca -3bps day on day to close at 14.41% from 14.44%.

Eurobonds

A quiet day in the nations Eurobonds market today despite Oil prices crossing the $70 per barrel mark. Average yields shed ca -1bps day-on-day with the February 2038 and January 2049 maturities closing at 7.72% and 8.24% respectively.

Equities
The Nigerian equities market commenced the week on a negative note today, as the Nigerian Stock Exchange All Share Index (NSE ASI) lost ca -1.53% day-on-day to close at 29,162.24pts, with market’s year-to-date returns at -7.22%. This was majorly on the back of losses in Dangote Cement Plc at (-1.85%), Guaranty Trust Bank Plc (-2.86%) and Stanbic IBTC Holdings Plc (-6.59%).

The NSE Banking, Consumer Goods and Industrial indices all lost ca -251bps, -35bps and -88bps respectively, while the NSE Oil & Gas index gained +8bps day on day. Sterling Bank Plc led the volume chart with 93.42m units while Guaranty Trust Bank Plc led the value chart with ca ₦2.66bn worth of trades.

The Naira remained stable against the dollar in both the interbank and parallel markets today, at ₦306.95/$1 and ₦360/$1 respectively. It was also stable against the Pound sterling and the Euro at ₦475/₤1 and ₦405/€1 respectively, in the parallel market. In the Nigerian Autonomous Foreign Exchange (NAFEX) window, Naira appreciated against the Dollar at ₦360.27/$1 from ₦360.42/$1.

Oil prices rose to a five-month high today, driven by expectations for tighter global supply with expected cut to output from Libya, the Organisation of Petroleum Exporting Countries (OPEC) led cuts and expected increased U.S. sanctions against Iran and Venezuela. Brent crude oil price gained ca +1.05% day-on-day at $71.08pb, while WTI gained ca +1.90% day-on-day at $64.28pb, as at report time. Spot gold gained ca +0.47% to close at $1,301.60 from $1,295.90 per ounce.

Top 5 Equitiy Advancers
Name (Symbol) Closing Price Gain(N) % Change
MBENEFIT 0.22 0.03 +10.00%
NEIMETH 0.56 0.02 +9.80%
LEARNAFRCA 1.34 0.02 +8.94%
CHAMS 0.26 0.55 +8.33%
ETERNA 4.25 0.21 +6.25%
Top 5 Equity Decliners
Name (Symbol) Closing Price Gain(N) % Change
FIDSON 4.05 -0.05 -10.00%
TRIPPLEG 0.7 -0.07 -9.09%
NPFMCRFBK 1.36 -0.45 -8.72%
CHIPLC 0.25 -0.05 -7.41%
MCNICHOLS 0.63 -0.05 -7.35%
Benchmark T-Bills Discount Rates
08-Apr-19 05-Apr-19 Change in Rates
66Days                                      . 11.53% 11.65% -0.12%
157Days- 13.02% 12.92% 0.10%
325Days. 13.00% 12.92% 0.08%
Source: FMDQ DQL for 08 April 2019
*T-Bills Discount Rates are slightly different from current market rates
Benchmark FGN Bond Yields
08-Apr-19 05-Apr-19 Change in Yield
3 yrs: 16.00% 15-Jul-2021 14.40% 14.40% 0.00%
5 yrs: 15.54% 27-Apr 2023 14.42% 14.31% 0.11%
10 yrs: 16.29% 17 Mar 2027 14.46% 14.46% 0.00%
20 yrs: 16.25% 18-Apr 2037  . 14.34% 14.32% 0.02%
Source: FMDQ DQL for 08 April 2019
Benchmark FGN EuroBond Yields
08-Apr-19 05-Apr-19 Change in Yield
3 yrs: NGERIA 6 3/4 01/28/21 4.88% 4.88% 0.00%
5 yrs: NGERIA 6 3/8 07/12/23 5.46% 5.47% -0.01%
10 yrs: NGERIA 6 1/2 11/28/27 6.66% 6.67% -0.01%
20 yrs: NGERIA 7.696 02/23/38 7.72% 7.74% -0.02%
30 yrs: NGERIA 9.248 01/21/49 8.24% 8.25% -0.01%
Source: FMDQ DQL for 08 April 2019
AIICO Money Market Fund (AMMF)
Net Yield (As at current date) 13.62% 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-19 115 11.10% 11.50%
17-Oct-19 192 12.35% 13.21%
07-Nov-19 213 12.45% 13.43%
16-Jan-20 283 12.30% 13.60%

 

Select Macro-economic Indices
Inflation % (February 2019) 11.31 (-1.14% ytd)
PMI (March 2019) 57.40
MPR (%) 14 (-5%/+2% around mid-point)
CRR (%) 22.5
Brent Crude Price US$ pbbl 71.08 (+1.05% d/d)
External Reserve (US$’billion) 44.648 (+3.55% ytd)
GDP % (Q4 2018) +2.38% (Q3 2018: +1.81% y/y)
NSE All Share Index (ASI) 29,162.24 (-1.53% d/d; -7.22% ytd)
Market Capitalisation (₦’Trillion) 10.95

 

Financial Markets Update – 02 April 2019

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