FINANCIAL MARKETS TODAY – 05 August 2021

FIXED INCOME MARKET

Money Markets

System Liquidity eased slightly today, opening with a balance of ca ₦107.27 billion, lower than the previous day’s opening of ca ₦155.00 billion. The Open Buy Back (OBB) and Overnight (ON) rates trended lower to settle at 5.25% and 5.50% from 8.50% and 9.00% respectively, the previous day.

Treasury Bills

The NTB secondary market was largely bullish today, with demand seen on the June and July 2022 papers at 7.70% levels. The Jan’22 papers also sparked interest, with few trades executed at sub. 4.50% levels. Thus, average rate fell by ca 7bps, day-on-day. In contrast, the OMO market remained quiet, with scanty offers. Consequently, average rate stayed flat, day-on-day.

Bonds

Bullish sentiment was witnessed in the FGN bonds secondary market, with most activity skewed to the 2027, 2035 and 2036 maturities at 12.35%, 13.20% and 13.25% levels respectively. Also, some cherry-picking activity was witnessed on the 2026 and 2050 maturities at 12.15% and 13.30% levels respectively. Consequently, the average yield declined by ca 6bps, day-on-day.

Eurobonds

The Eurobonds traded bearish today, with sell-offs seen across the yield curve. Average yield gained ca 6bp, day-on-day.

Equities

The Nigerian Equities Market lost some of the previous day’s gains , with the Nigerian Stock Exchange All Share Index (NSE ASI) losing 0.32% day-on-day, to close at 38,801.51pts, while market year-to-date loss expanded to -3.65%. This was largely due to losses in GTCO Nigeria Plc (-1.23%) and Zenith Bank Plc (-0.41%).

The NSE Consumer Goods and Industrial Goods indices gained ca 0.26% and 0.04% respectively, while the NSE Banking and Oil and Gas indices fell ca 0.30% and 0.04% respectively, day-on-day.

United Bank for Africa Plc led the volume chart with ca 16.43 million units, while GTCO Nigeria Plc led the value chart with ca ₦364.85 million worth of trades.

Foreign Exchange

In the parallel market, the Naira appreciated against the U.S Dollar and Euro to ₦508.00/$1.00 and ₦598.00/€1.00 from ₦506.00/$1.00 and ₦595.00/€1.00 respectively, while remaining flat against the Pound Sterling at ₦705.00/₤1.00. FMDQ Nigerian Autonomous Foreign Exchange Fixing (NAFEX) appreciated to ₦411.25/$1.00 from ₦411.44/$1.00.

Commodities

Global crude oil fell further today, as the U.S Energy Information Administration reported a rise in U.S crude inventories of 3.5 million barrels per day. This comes despite reports of tensions in the Middle East between Israel and Lebanon. Thus, Brent Crude oil price lost ca 0.20% day-on-day to settle at $70.29pb, while WTI lost ca 0.16% to $68.08pb, as at report time. Spot Gold lost ca 0.08% day-on-day to $1,813.10 per ounce as at report time.

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