FINANCIAL MARKETS TODAY – 10 August 2021

FIXED INCOME MARKET
Money Markets

Liquidity in the banking system improved today (buoyed by OMO maturities of ₦80bn), opening with a balance of ca ₦133.77 billion, higher than the previous day’s opening of ca ₦26.27 billion. Thus, the Open Buy Back (OBB) remained flat at 13.00% while the Overnight (ON) rate trended lower to settle at 13.50% from 13.75% respectively, the previous day.

Treasury Bills

The NTB secondary market maintained a bullish theme with demand seen at the long end of the curve, particularly for the June and July NTB maturities at ca 7.20% levels, however, few trades were executed due to a dearth of offers. Thus, the average rate fell by ca 14bps, day-on-day. Likewise, demand was seen on selected maturities across the OMO curve. Thus, average yield lost ca 4bps, day-on-day.

Bonds

The FGN Bonds secondary market traded with a bullish theme, with buy interest observed on the 2027s, 2028s, 2035s, 2036s, and 2050s at ca 12.00%, 12.05%, 12.90%, 12.88%, and 13.15%, respectively. However, towards the close of today’s trading session, a slight reversal in yield level was seen, as market players reacted to the release of the August FGN bond auction offerings. Nevertheless, average yield dipped ca 6bps, day-on-day.

Eurobonds

Bearish trading sentiment was witnessed in the Eurobonds space today, with sell offs seen across the yield curve. Consequently, average yield rose by ca 2bps, day-on-day.

Equities

With gains recorded in stocks such as Airtel Africa Plc (+10.00%) and MTN Nigeria Communications Plc (+2.38%), the domestic bourse reversed its bearish stance as the Nigerian Stock Exchange All Share Index (NSE ASI) gained 158bps day-on-day to close at 39,176.62pts, while market year-to-date loss pared to –2.72%.

The NSE Oil & Gas Index gained ca 0.11%, while the NSE Consumer Goods, Industrial Goods and Banking indices fell ca 0.09%, 0.06% and 0.02% day-on-day, respectively.

B.O.C Gases Plc led both the volume and value charts with ca 249.77 million units traded at ca ₦1.37 billion.

Foreign Exchange

In the parallel market, the Naira remained stable against the U.S Dollar and Euro at ₦510.00/$1.00 and ₦596.00/€1.00 respectively, while appreciating against the Pound Sterling to ₦703.00/₤1.00 from ₦705.00/₤1.00. FMDQ Nigerian Autonomous Foreign Exchange Fixing (NAFEX) remained flat at ₦411.50/$1.00.

Commodities

Global crude oil prices reversed earlier losses, amid increasing optimism on market conditions as reports of an upsurge in demand across Europe and the United States outweighed concerns of the increase in Coronavirus cases. Thus, Brent Crude oil price gained ca 2.87% day-on-day to $71.00pb, while WTI rose ca +3.37% to $68.77pb, as at report time. Spot Gold gained ca 0.14% day-on-day to $1,728.80 per ounce as at report time.

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