Angola Lead The Sub-Saharan Africa Eurobonds With Nigeria Strengthening In The Shadows

Proshare

Thursday, June 25, 2020 / 8:22 AM / By Zedcrest Capital / Header Image Credit: ilearnlot


Proshare Nigeria Pvt. Ltd.


Below are highlights of trading activities in the fixed income and forex market on June 24, 2020 


FGN Bonds

The bullish train slowed down in today's session, with some profit-taking activities caused yields to retrace at the head and belly of the curve. We noted sustained demand for mid- and longer-dated papers, with the 30-year papers remaining the preferred bonds as market participants hunted for the only yields available above 11.00%. Consequently, yields expanded by an average of c.24bps across the benchmark curve.

We expect to trade with mixed sentiments, as local investors continue to pounce on available offers as they improve across the curve.

 

Benchmark FGN Bonds

Description

Bid (%)

Offer (%)

Day Change (%)

 

14.50 15-Jul-21

5.29

3.74

0.39

 

16.39 27-Jan-22

5.68

4.20

0.58

 

12.75 27-Apr-23

7.01

5.95

(0.37)

 

14.20 14-Mar-24

9.62

6.25

2.29

 

13.53 23-Mar-25

8.10

6.99

0.45

 

12.50 22-Jan-26

9.12

7.98

0.11

 

16.29 17-Mar-27

9.78

9.19

0.00

 

13.98 23-Feb-28

9.90

8.86

0.00

 

14.55 26-Apr-29

9.89

9.04

0.00

 

12.15 18-Jul-34

10.62

10.25

(0.07)

 

12.40 18-Mar-36

10.61

10.26

(0.06)

 

16.2499 18-Apr-37

10.68

10.21

0.00

 

14.80 26-Apr-49

11.50

11.31

(0.15)

 

 

Treasury Bills

There was some slight action during the early hours of trading in the OMO bills space, as we saw demand from offshore players for August/September bills. Offers were in the range of 3.80%-4.10% for these papers, although very little volumes printed in this range. By mid-day, activities dwindled even as the market remained offered across most of the benchmark curve. We also noted some trades on the 25 May 2021 bill, which traded around 5.75% close to the end of the session. Consequently, yields expanded by c.16bps across the OMO curve. 

We saw few retail-sized interests in the NTB space, skewed to longer-dated bills (April 2021 papers and above). Bids were more aggressive across the NTB curve although offers stayed far apart thus resulting in no trades concluded. Yields compressed by an average of c.66bps in the NTB space.

The market is expected to remain calm, with some order-driven requests on selected papers expected.

 

Benchmark OMO Bills

Description

Bid (%)

Offer (%)

Day Change (%)

NGOMO 7/2/2020

5.00

1.50

0.00

NGOMO 8/13/2020

5.00

1.50

1.50

NGOMO 9/3/2020

5.25

2.00

0.25

NGOMO 10/1/2020

5.50

2.00

0.00

NGOMO 11/03/2020

5.50

2.50

(0.10)

NGOMO 12/01/2020

6.00

4.00

0.00

NGOMO 01/05/2021

6.25

4.00

(0.25)

NGOMO 02/02/2021

6.50

3.50

0.00

NGOMO 03/02/21

6.50

4.80

0.00

 

Benchmark NTBills

Description

Bid (%)

Offer (%)

Day Change (%)

NIGTB 2-Jul-20

3.00

1.00

0.00

NIGTB 1-Oct-20

2.25

1.00

(0.75)

NIGTB 12-Nov-20

2.50

1.00

(1.50)

NIGTB 14-Jan-21

3.25

1.00

(0.75)

NIGTB 11-Feb-21

3.70

1.00

(0.30)


 

Money Market

The Interbank market remained illiquid, with most banks stuck at the SLF window amidst tight liquidity. OBB rates remained unchanged while OVN rates inched up slightly by c.8bps from yesterday's close. System liquidity is expected to close the day at c.N29.31BN.

As this system liquidity is expected to persist in the interim, we expect interbank rates remain around these levels tomorrow.


Money Market Rates

 

Current (%)

Previous (%)

Open Buy Back (OBB)

14.67

14.67

Overnight (O/N)

15.75

15.67

 

FX Market

Supply remained poor in the I&E FX window, with the traded volume stable at c.$90million same as the day before. Most participants were bided between N385.00/$ and N389.00/$ with rates depreciating by 0.13% D/D. Closing rates remained unchanged for other market segments, as activities in the FX market remain low.

 

FX Market

Current (N/$)

Previous ( N/$)

CBN Spot

361.00

361.00

CBN SMIS

380.69

380.69

`I&E FX Window

387.17

386.63

Cash Market

455.00

455.00

Transfer Market

457.00

457.00

 

Eurobonds

The NGERIA Sovereign tickers strengthened in today's session as the market reacted positively to DMO's comments indicating no new Eurobond issues this year. Bids improved across the sovereign curve, with the most gains at the short-end of the curve. Yields compressed by c.19bps across the benchmark curve by the close of the day, the gains paling in comparison to the Angola papers which continued to rally for another consecutive session off the debt relief news. 

The NGERIA Corps had a quiet session today, amidst weak appetite. The SEPPLN 23s was the only gainer among tracked papers, dropping by c.15bps D/D.


Proshare Nigeria Pvt. Ltd.


Proshare Nigeria Pvt. Ltd.


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