Bonds & Fixed Income | |
Bonds & Fixed Income | |
2951 VIEWS | |
![]() |
Thursday, June 20, 2019 / 8:00PM /
Zedcrest Capital
The NGERIA Sovereigns posted significant gains in today’s session, with most tickers gaining as much as 2.5pct from their previous closing prices. This came on the back of the dovish leaning amongst major central banks and optimism on resolution of US-China trade tensions.
Below are highlights from activities in the fixed income and forex market today.
Bonds
The FGN Bond market remained relatively stable, with yields compressing marginally by c.4bps following some demand mostly on the short end of the curve. We also witnessed slight demand interests on the 28s and 36s during the session, whilst there were better sellers of the 34s.
Despite
expectations for renewed supply of bonds at the auction next week, we expect
yields to remain relatively stable as moderately dovish sentiments and
declining bond yields in developed markets are expected to support demand for
higher yields in emerging markets.
|
|||
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
14.50 15-Jul-21 |
14.31 |
13.92 |
0.00 |
16.39 27-Jan-22 |
14.19 |
13.89 |
(0.35) |
12.75 27-Apr-23 |
14.66 |
14.35 |
0.01 |
14.20 14-Mar-24 |
14.48 |
14.09 |
(0.03) |
13.53 23-Mar-25 |
14.59 |
14.30 |
(0.02) |
12.50 22-Jan-26 |
14.67 |
14.54 |
0.00 |
16.29 17-Mar-27 |
14.65 |
14.40 |
0.06 |
13.98 23-Feb-28 |
14.55 |
14.46 |
(0.11) |
12.15 18-Jul-34 |
14.73 |
14.54 |
0.03 |
12.40 18-Mar-36 |
14.63 |
14.56 |
(0.02) |
16.2499 18-Apr-37 |
14.65 |
14.49 |
(0.06) |
Source: Zedcrest Dealing Desk
Treasury Bills
The
T-bills market traded on a relatively flat note despite the inflows from OMO
maturities. We witnessed slight demand on the short end (Jul- Sep), whilst
there were better sellers on the mid tenors (Feb/Mar). Yields were consequently
lower by c.3bps on the day.
We expect the market to remain relatively stable in the near term due to the robust system liquidity levels.
|
|||
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
18-Jul-19 |
11.25 |
6.00 |
(0.25) |
1-Aug-19 |
11.50 |
6.00 |
0.00 |
12-Sep-19 |
11.30 |
10.00 |
(0.45) |
3-Oct-19 |
11.90 |
11.70 |
0.10 |
14-Nov-19 |
12.15 |
11.75 |
0.00 |
5-Dec-19 |
12.05 |
11.80 |
0.00 |
2-Jan-20 |
12.10 |
11.85 |
0.00 |
6-Feb-20 |
12.25 |
12.00 |
0.10 |
19-Mar-20 |
12.25 |
12.00 |
0.05 |
2-Apr-20 |
12.20 |
11.95 |
0.05 |
14-May-20 |
12.20 |
11.95 |
0.05 |
04-Jun-20 |
12.20 |
12.00 |
0.00 |
Source: Zedcrest Dealing Desk
Money Market
Rates in the money market moderated further by c.3bps as inflows from OMO maturities bolstered system liquidity higher. The OBB and OVN rates consequently ended the session at 4.43% and 5.00%, with system liquidity currently estimated at c.N260bn.
We
expect rates to close the week on a stable note, as there are significant
outflows anticipated.
Money Market Rates |
||
|
Current (%) |
Previous (%) |
Open
Buy Back (OBB) |
4.43 |
6.86 |
Overnight
(O/N) |
5.00 |
7.50 |
Source: FMDQ, Zedcrest
Research
FX Market
At the interbank, the Naira/USD rate remained stable to close at
N306.95/$ (spot) and N356.92/$ (SMIS), whilst the NAFEX rate at the I&E
window closed slightly higher at N360.69/$. At the parallel market, the cash
and transfer rates closed unchanged at N359.80/$ and N362.50/$ respectively.
FX Market |
||
|
Current (N/$) |
Previous ( N/$) |
CBN
Spot |
306.95 |
306.95 |
CBN
SMIS |
356.92 |
356.92 |
I&E
FX Window |
360.69 |
360.53 |
Cash
Market |
359.80 |
359.80 |
Transfer
Market |
362.50 |
362.50 |
Source: CBN, FMDQ,
REXEL BDC
Eurobonds
Investors’ demand were markedly higher in the NGERIA corps space,
with the most interest on the FIDBAN 22s and ETINL 24s which gained as much as
1pct on the day. This came on the back of anticipated inflows from the
announced call on the $400m ACCESS 2021s Subordinated Eurobonds.
Related News
1. Lafarge Africa
Plc Redeemed Its N26.4 Billion Series 1 Bond Due On June 15, 2019
2. Nigerian
Eurobonds Surge on Trump-Xi’s Planned Meeting at G-20 Summit
3. Treasury Bills
Market Sustain Bull Run As CBN Holds Off On OMO
4. DMO Lists FRN
Dual-Tranche $2.5bn and Triple Tranche $2.86bn Eurobond on FMDQ OTC
5. A Quiet Trading
Session as Primary Market T-Bills Auction Takes Centre Stage
6. Market Interest
Rates Edge Upwards
7. June 2019 FGN
Savings Bonds Offer for Subscription
8. Average Money
Market Rate Rose By 6.61% To Settle At 11.15% Due To Constraint In System
Liquidity
9. Ecobank Hosted
by London Stock Exchange After Successful $500m Eurobond Issuance
10. Dangote Cement
Plc Series 8, 9 and 10 Commercial Paper To Open Soon
11. Why Nigeria
Needs To Utilize The Green Bonds Market - Olumide Lala
12. Treasury Bills
Yields Expand Across the Curve as Market Adjusted to Anticipated Supply