Market Brief: NSE sustains positive momentum on accretion into external reserve
The Nigerian equity market closed on a positive note yesterday, as all share index increased by 0.06% to close at 23,709.44 points.
The market cap of equities listed on the NSE increased to N12.356 trillion from N12.349 trillion as on the previous day.
The total volume traded closed with an exchange of 159.235 million units valued at N1.54 billion traded in 3,573 deals.
Also, market breadth was positive with 20 gainers as against 8 losers.
Market brief NSE-30
The NSE 30 index increased by 0.09 percent to close at 1,019.20 as against 1,018.27 points on the previous day.
Market turnover closed with traded volume of 108.39 million units. Unilever Nigeria and MOBIL (11 Plc) were the key gainers, while MTN Communications Plc and UBA were the key losers.
Money Markets
In the money market, as of May 13, the overnight (O/N) rate declined by 0.57 percent to close at 7.63 percent as against 8.20 percent.
Then, the open buy back (OBB) rate declined 0.40 percent to close at 7.00 percent from 7.40 percent on the previous day.
Nigeria’s FX reserves increased to $34.78 billion (as of May 12, 2020) narrowing year to date (YTD) change to -9.90 percent due to the inflows worth $3.4 billion from the IMF and the refund of Abacha Loot worth $311 million.
Nigeria seeks to borrow about $46.9 billion from the multilateral in 2020 to stimulate the economy amid the negative impact of coronavirus.
FSDH expects inflows from the World Bank worth $2.5 billion and the AFDB worth $1.0 billion by the third quarter of 2020.
Treasury bills
Nigerian T-Bills market ended the trading session on a positive note, with average yield across the curve declining by 36 bps to close at 2.30 percent from 2.66 percent on the previous day.
FSDH stated that average yields across the short (-17bps) and medium (-78bps) tenor of the curve compressed due to the maximum buying interest witnessed on the NTB 10-Sep-20(-83bps), NTB 17-Sep-20(-80bps) maturity bills.
However the average yield across long tenure of the curve remained unchanged.
At the primary Market auction held today, the CBN offerd NT-bills worth N33.84 billion across the 91 day (N4.38 billion) 182-day (12.92 billion), and 364-day (N16.54 billion) tenors.
In the OMO bills market, average yield across the curve declined by 8bps to 9.44 percent as against the last close of 9.52 percent.
Buying interest was witnessed across long-term maturities, with the average yield falling by 19bps.
However the average yield across medium-term maturities increased by 3 bps, while the average yield across short- term maturities remained unchanged.
Yields on 8 bills fell with the 1-Oct-20 maturity bill recording the highest yield decline of 80 bps, while the 17–Sep-20 maturity bill registered the highest yield increase of 116 bps
Bond Markets
The FGN bond market closed on a positive note today, as the average bond yield across the curve cleared lower by 5 bps to close at 6.32 percent from 6.37 percent on the previous day.
Average yields across short medium and long tenor of the curve fell by 5 bps, 4 bps and 5 bps respectively.
The FGNSB 15-AUG-2020 bond was the best performer with a decline in yield of 57 bps, while the FGNSB 16-MAY-2020 bond was the worst performer with an increase in yield of 23 bps.
Yesterday the DMO issued its bond offer circular for the May 2020 FGN Bond auction with no change in the supply of bonds worth N60 billion across three tenors .
The Federal Government has received the legislative approval for revised borrowing plans.
“We expect a revised bond issuance calendar by the DMO, as the market looks for guidance as to how the DMO plans to raise the additional amount approved by the legislature to finance the 2020 budget”, FSDH stated.
Market Brief: NSE sustains positive momentum on accretion into external reserve
