A Review of the Nigerian Energy Industry

Financial market update

05 March 2013, Sweetcrude, Lagos – Local and international financial market update.
NIGERIA: The African Development Bank Group has approved a loan of $300m to facilitate the development of Nigeria’s transportation system. A statement by the bank, which was obtained on Sunday, specifically said the loan was meant to finance the transport sector and economic reform programmes as well as Nigeria’s strategic projects for the period of 2013-2017. The loan, it added, aimed to support the implementation of the Federal Government’s reform in the transport sector and public expenditure management.

EUROPE: European stock futures climbed amid speculation that central banks around the world will continue with measures to support economic recovery. Futures on the Euro Stoxx 50 Index expiring this month added 0.5 percent to 2,637 at 7:08 a.m. in London.

INDIA: India’s service industries expanded at a slower pace in February, a private survey showed, as the weakest economic growth in a decade capped demand. The purchasing managers’ index fell to 54.2 from 57.5 in January, HSBC Holdings Plc and Markit Economics said in a statement today. A number above 50 indicates growth. Services account for about 58 percent of gross domestic product.

CHINA: Chinese stocks rebounded after the CSI 300 Index’s biggest drop in two years and as the government pledged to increase fiscal spending to support economic growth. During today’s start of the National People’s Congress, the government announced it would keep its economic growth target at 7.5 percent, unchanged from 2012, while projecting a 10 percent jump in fiscal spending to fund areas such as health care, agriculture and education. The CSI 300 Index jumped 3 percent to 2,622.81 at the close, while the Shanghai Composite Index rose 2.3 percent to 2,326.31.

Bonds – Yields trended downward about 10bps on average yesterday with some light buying across the curve and direction tipping towards a rally.

Bills – Quiet session on Monday with the central bank coming out to offer N150billion across 80,115 &164 day bills. They only sold N45billion between 10.349 and 10.50%. Secondary market activity will likely take the back foot as most of the focus goes into the primary auction and OMO auctions this week.

Money Market – OBB and unsecured O/N rates eased to 10.10% and 10.15% yesterday. Market is being kept liquid by OMO maturities.

CBN WDAS AUCTION- CBN offered $250m and sold $234.9m. Marginal rate at 155.75 naira, unchanged from previous sale on Feb. 27.

Indicative Currency Exchange Rates
Bid               Offer

EURUSD      1.3040            1.3050
GBPUSD       1.5115             1.5125
USDJPY         93.12              93.52
USDCHF       0.9409           0.9429
GBPEUR        1.1592            1.1602
USDZAR       9.0614           9.1614
USDNGN      156.92            157.67
JPYNGN        1.6851            1.7351
CHFNGN       166.78           170.78
EURNGN      204.62          208.62
GBPNGN       237.18          241.18
ZARNGN      17.32              19.32

Brent for April settlement on the London-based ICE Futures Europe exchange gained as much as 55 cents, or 0.6 percent, to $110.64 a barrel. The volume of all futures traded was 7.3 percent above the 100-day average.

Interest rates
NIBOR (%)                          LIBOR (%)

O/N             10.2500              USD 1 month               0.2052
7 Day            10.7500             USD 2 month               0.2425
30 Day         11.4583              USD 3 month               0.2831
60 Day         11.8333              USD 4 month               0.3361
90 Day         12.1250              USD 6 month               0.4554
USD 12 month             0.7450
Y/Y Consumer Inflation January 2013 :                  9.00%
FX Reserves: 21 February 2013 (USD bn)              47.017
MPR                                                                                12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

                           Hi                Low          Close      Prev.Close
USD/NGN  157.90/00    157.10/20   157.22/32   158.06/16

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