Bonds & Fixed Income | |
Bonds & Fixed Income | |
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Wednesday, October 16, 2019 / 10:43 AM / By Zedcrest Capital / Header Image Credit: Financengr
Below are
highlights of trading activities in the fixed income and forex market on
October 15, 2019
Bonds
The Bond market traded on a cautious note, with mixed sentiments
noted on across the curve. We noted buying interests at the short- (2022s) and
long-end (2034s) of the curve, while the mid-end (2025s) were sold-off in the day's
trading session. Yields consequently closed higher by c.1bp on the average
across the benchmark bond curve.
With inflations figures inching up by 22bps from the previous, we
expect a cautious opening to tomorrow's trading session as investors continue
to evaluate the real return on their portfolios.
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Description |
Bid (%) |
Offer (%) |
Day Change (%) |
14.50 15-Jul-21 |
14.32 |
13.47 |
0.02 |
16.39 27-Jan-22 |
14.16 |
13.72 |
0.01 |
12.75 27-Apr-23 |
14.40 |
14.28 |
0.02 |
14.20 14-Mar-24 |
14.19 |
13.72 |
0.01 |
13.53 23-Mar-25 |
14.34 |
14.18 |
0.10 |
12.50 22-Jan-26 |
14.38 |
14.28 |
0.00 |
16.29 17-Mar-27 |
14.27 |
14.10 |
0.00 |
13.98 23-Feb-28 |
14.39 |
14.28 |
0.00 |
12.15 18-Jul-34 |
14.53 |
14.34 |
0.00 |
12.40 18-Mar-36 |
14.49 |
14.31 |
(0.04) |
16.2499 18-Apr-37 |
14.52 |
14.43 |
(0.03) |
14.80 26-Apr-49 |
14.67 |
14.59 |
0.00 |
Source: Zedcrest Dealing Desk
Treasury Bills
The T-bills market traded bullish across the short- to mid-end of
the NTBills curve, while yields on the long-end retraced higher. We noted significant
demand on some December - February maturities, as market players position ahead
of the PMA to hold tomorrow. We however also noted a slowdown of the demand for
maturities at the long-end due to the prospect of higher yields at the coming
PMA, most notably the October maturities which closed higher by c.15bps.
We expect a quiet market as market participants shift focus to the
Primary Market Auction coming up tomorrow.
Benchmark
Treasury Bills |
|||
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
14-Nov-19 |
11.20 |
10.00 |
(1.10) |
5-Dec-19 |
11.70 |
11.10 |
(0.60) |
2-Jan-20 |
12.00 |
11.05 |
(0.50) |
6-Feb-20 |
12.50 |
11.00 |
0.00 |
19-Mar-20 |
12.00 |
11.00 |
(0.50) |
2-Apr-20 |
11.75 |
11.25 |
(0.75) |
14-May-20 |
12.80 |
11.50 |
0.00 |
04-Jun-20 |
12.75 |
11.60 |
0.25 |
02-Jul-20 |
12.85 |
12.20 |
0.00 |
13-Aug-20 |
12.85 |
12.30 |
0.00 |
3-Sep-20 |
12.70 |
12.30 |
(0.15) |
1-Oct-20 |
12.90 |
12.35 |
0.05 |
Source: Zedcrest Dealing Desk
Money Market
Money market rates crashed by an
average of c.700bps from yesterday's close. Market liquidity figures opened
with c.N250bn, with FX auction refunds providing some respite to system
liquidity levels. OBB and OVN rates closed today at 8.43% and 9.14%
respectively.
We expect rates to remain stable
at single digits, with no expected outflows being provided for by banks.
Money Market Rates |
||
|
Current (%) |
Previous (%) |
Open Buy Back (OBB) |
8.43 |
16.00 |
Overnight (O/N) |
9.14 |
16.79 |
Source: FMDQ, Zedcrest
FX Market
The Naira/USD remained stable at the
interbank, as the Naira/USD spot and SMIS rates remained stable at N306.95/$
and N358.13/$ respectively. At the I&E FX window, depreciated by 50k the
previous day.
The cash and transfer rates at the parallel
markets also remained stable, closing unchanged at N358.00/$ and N362.50/$ respectively.
FX Market |
||
|
Current (N/$) |
Previous ( N/$) |
CBN Spot |
306.95 |
306.95 |
CBN SMIS |
358.13 |
358.13 |
I&E FX Window |
362.63 |
362.13 |
Cash Market |
358.00 |
358.00 |
Transfer Market |
362.50 |
362.50 |
Source: CBN, FMDQ, REXEL BDC
Eurobonds
The NGERIA
Sovereigns had a quiet trade session for the second day this week with little
activity witnessed. Brent crude prices further dipped from yesterday by 0.64%,
but had little effect across the sovereign curve.
We had an active NIGERIA Corps trade session, we noted a sell-off at the short- to
mid-end dated papers, especially UBANL 2022 which lost an average of c.19bps.
Related News
1.
Money Market
Rates Hit A 3-week High, As CBN Drains Liquidity Via Wholesale FX Auction
2.
DMO Lists Series
II FGN N15bn 7-Year Green Bond on NSE
3.
Sustained
Bullish Run as Average Yield Falls 0.7% WoW to 12.6%
4.
Money Market
Rates Close The Week Higher as Retail FX Take Out Liquidity
5.
NSE, LuxSE Sign
MoU to Expand the Green Bond Markets
6.
Bullish Trend
Continues for Treasury Bills Ahead of Expected OMO Auction
7.
T.Bills Yields
Drop Further As Market Liquidity Persists
8.
The Bulls Take
Centre Stage as Average Yield Declines 6bps WoW to 13.3%