Financial market products & services update

*Financial markets.

16 March 2017, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: The value of trading at the stock market surged 133% Wednesday as investors staked N2.164 billion on 233.777 million shares in 3,196 deals, up from N928.5 million invested in 227.757 million shares in 32,543 deals the previous day. The market also maintained its uptick as the bulls sustained their hold, driving the Nigerian Stock Exchange (NSE) higher by 0.07% to close at 25,301.23.
Having opened on weak note on Monday, the market rebounded on Tuesday following activities of bargain hunters, who swooped on bellwether stocks. Hence, the NSE ASI went up by 0.59% on Tuesday. The bullish trend was sustained yesterday, although marginally. However, investors committed more funds to equities.

FX: The result for the CBN auction announced on Tuesday with $150mio on offer was released yesterday and the CB had called for another auction today with $100 mio on Offer.

FIXED INCOME: The secondary market was dominated by auction expectations. Amount sold by DMO increased by 31% and 128% respectively on the popular 1 year and 20year. Prints at the bond auction were particularly aggressive. The 10 year debuted at 16.2884% while the 5 year and 20 year at 16.24% (-31bps) and 16.28% (-49bps) respectively. T-Bill prints came in at 14.08% (-5bps), 18.81% (-) and 22.78% (+10bps) yield on the 91, 182 and 364 day bills. Overall, street is long paper and we could see some slight sales today in both bills and bonds.

COMMODITIES: Oil extended gains above $49 a barrel as U.S. government data showed an unexpected fall in crude stockpiles, the first decline this year.
Futures rose as much as 1.6% in New York after advancing 2.4% on Wednesday, snapping a seven-session decline. Crude stockpiles dropped by 237,000 barrels last week, according to an Energy Information Administration report. A Bloomberg survey had forecast a 10th weekly expansion. Iraq plans to increase output to 5 million barrels a day by the end of 2017, Oil Minister Jabbar Al-Luaibi said at a news conference in the southern city of Basra.

U.K: Faster inflation appears to be making a case for a rate hike at the Bank of England, but recent signs of a weakening economy and the looming Brexit negotiations mean officials aren’t ready to go there yet.
The BOE announces its policy decision at noon in London, and economists predict the benchmark rate would stay at a record-low 0.25%. With the pound’s 18% drop since the referendum fanning consumer prices and starting to squeeze households, officials will probably allow inflation to wander above target so as not to subdue growth. That contrasts with the U.S. Federal Reserve, which raised rates on Wednesday and signaled more to come as inflation gets close to its goal.

CHINA: China’s central bank raised borrowing costs as a stable economy and factory reflation give it scope to follow the Federal Reserve in tightening policy.
Hours after the Fed’s quarter-percentage-point move, the People’s Bank of China increased the rates it charges in open-market operations and on its medium-term lending facility.
The central bank said markets expected higher borrowing costs and that open-market rate increases don’t necessarily equate to interest-rate hikes, according to a statement. With the economy steady, inflation rising and real lending costs going down, financial institutions have strong incentives to expand credit, and housing prices have surged in some cities, it said.

Macro Economic Indicators
Inflation rate (Y-o-Y) for February 2017,     17.80%
Monetary Policy Rate current                         14.00%
FX Reserves (Bn $) as at Mar 14, 2017,        30.231

Money Market Highlights

O/N                           14.7500
30 Day                      17.1968
90 Day                      20.0890
180 Day                    23.0381
USD 1 Month          0.92833
USD 2 Months        0.97722
USD 3 Months        1.13733
USD 6 Months        1.43239
USD 12 Months      1.72400

Benchmark yields
Tenor       Maturity      Yield (%)

91d             15-Jun-17        16.72
182d          14-Sep-17         19.34
364d          01-Mar-18       22.15
2y               29-Jun-19       15.76
3y               13-Feb-20       16.03
5y               15-Jul-21         16.19

Indicative Currency Exchange Rates
Bid         Offer

USDNGN        314.50       315.00
EURUSD         1.0608      1.0809
GBPUSD          1.2149       1.2351
USDJPY           113.45       113.47
USDCHF         0.99465    1.0048
GBPEUR         1.1339       1.1544
USDZAR         12.6348    12.8383
JPYNGN         2.7297       2.8303
CHFNGN        314.33       316.02
EURNGN        334.14       335.50

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