A Review of the Nigerian Energy Industry

Financial market update

28 August 2012, Sweetcrude, Lagos – Local and international financial market update. NIGERIA: Nigeria United States of America Chamber of Commerce has announced plans to attract N330 billion worth of small and medium scale private business investment into Nigeria on a yearly basis, Chuck Nnabuike disclosed this during the chamber’s third summit in Lagos.

EUROPE: European stocks declined, snapping two days of gains, after Japan lowered an assessment of its economy for the first time in 10 months. The Stoxx Europe 600 Index lost 0.2 percent to 268.64 at 8:02 a.m. in London. The benchmark measure has still rallied 15 percent from this year’s low on June 4 as European Central Bank President Mario Draghi pledged to do whatever it takes to preserve the euro.

CHINA: China’s stocks rose, with the benchmark index heading for its biggest gain in two months, as steelmakers and oil refiners jumped amid speculation more state- owned companies will announce share buybacks. The Shanghai Composite Index rose 1 percent to 2,075.49 at 2:31 p.m. local time, after closing yesterday at the lowest level since Feb. 2, 2009.

INDIA: Indian stocks swung between gains and losses amid concern the political standoff between Prime Minister Manmohan Singh’s government and the main opposition party will delay implementation of economic reforms. The BSE India Sensitive Index, or Sensex, traded little changed at 17,679.25 at 11:14 a.m. in Mumbai, after changing directions at least seven times.

Bonds – Another flat session on bonds yesterday due to a slowdown in demand for bonds. Yields still expected to dip further across the curve.

Bills – OMO auction announcement came through early into yesterday’s session which curtailed expected demand in the market yesterday due to current liquidity levels, nothing was however sold at this auction with no reason from the CBN, yields closed relatively flat on the session after an initial upward move on yields.

Money Market – Lending rates up 150bps respectively at the open of the week to 12.00% and 12.50% respectively, market however remains liquid with additional inflow expected later in the week.

CBN CUT- OFF RATE – $/NGN 155.80

                          Hi              Low           Close          Prev.Close
USD/NGN  158.25/35   157.90/00   157.90/00   158.22/32

Interest rates
NIBOR (%)                       LIBOR (%)
O/N                12.3333     USD 1 month        0.2345
7 Day              13.1250     USD 2 month        0.3300
30 Day           13.6667     USD 3 month        0.4249
60 Day           14.0833     USD 4 month       0.5324
90 Day           14.4583     USD 6 month       0.7122
USD 12 month     1.0365
Y/Y Consumer Inflation June 2012 :            12.9%
FX Reserves: 24 August 2012 (USD bn)      38.005
MPR                                                                     12.00%

Source: FMD and CBN



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