Welcome once again to our daily market report where we look at the daily performance of major economic indicators and highlights from trading sessions and key statistics such as Treasury Bills, bonds, FX rates, inflation, oil price.
This report is dated April 16th, 2019.
***Nigeria’s Inflation Dips to 11.25% in March 2019 *** – NBS
Key Indicators
Bonds
The FGN Bond market remained slightly bullish in today’s session, with yields lower by c.4bps following some demand interest on some short and mid tenured maturities. The 2027s and 2028s remained the most actively traded, with sustained demand interest on the 27s, and some profit taking on the 28s up to c.14.58%.
We expect activities to be largely order driven in subsequent sessions, as market players wind down ahead of the Easter break. A slightly more bearish positioning is however anticipated as the FGN Bond auction for the month draws closer, whilst coupon payments on the 2037s expected Thursday may spur slight interest on that end of the curve.
Treasury Bills
The T-bills market remained slightly bearish as market players were constrained by the tight system liquidity levels. We however witnessed slight interests on some mid tenors ahead of the NTB auction scheduled for tomorrow.
The CBN will offer a total of N58.50bn of the 91, 182 and 364 day bills at the NTB auction scheduled for tomorrow, and we expect rates to clear slightly lower than their previous levels due to the smaller volumes on offer and absence of an OMO auction in the previous week.
Money Market
Rates in the money market declined sharply by c.25pct, as banks were able to access the CBN’s SLF for their funding needs. The OBB and OVN rates consequently ended the session at 16.14% and 17.43%, with system liquidity still estimated at c.N150bn negative.
We expect rates to remain relatively unchanged tomorrow, as there are no significant inflows anticipated.
FX Market
At the Interbank, the Naira/USD rate was stable at N306.95/$ at the spot market, while the SMIS rate depreciated marginally by 0.13% to N356.26/$. The NAFEX closing rate in the I&E window appreciated slightly by 0.02% to N360.23/$, as market turnover rose by 261% to $403m. At the parallel market, the cash and transfer rates remained unchanged at N358.50/$ and N364.00/$ respectively.
Eurobonds
The NGERIA Sovereigns traded on a relatively flat note, with some demand interests witnessed in the belly of the curve (30s, 31s & 32s).
In the NGERIA Corps, we witnessed renewed interests in the UBANL 22s, whilst investors took some profit on the FIDBAN 22s. The ETINL 24s also held on to gains from the previous session.
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Disclaimer:
Whilst proper and reasonable care has been taken in the preparation and accuracy of the facts and figures presented in this report, no responsibility or liability is accepted by Zedcrest Capital or its employees for any error, omission or opinion expressed herein. This report is not an investment research or a research recommendation and should not be regarded as such. The information provided herein is by no means intended to provide a sufficient basis on which to make an investment decision.
