Bonds & Fixed Income | |
Bonds & Fixed Income | |
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Wednesday, March 4, 2020 / 06:50 AM
/ By Zedcrest Capital / Header Image
Credit: Business Trumpet
Below are highlights of trading activities
in the fixed income and forex market on March 03, 2020
FGN Bonds
The
Bond Market traded on a mixed note, with decent activity across the curve. The
mid- to long-end saw the most traction, with local investors exhibiting a
bullish demeanor, as the market continues to recover from last week's bearish
view, buoyed by the news of the first case of the Coronavirus pandemic in
Nigeria. Yields, however, expanded by an average of 3bps across the benchmark
bond curve.
We
expect to see some bullish activity at the long-end, as local corporates take
advantage of its attractive yields.
Benchmark
FGN Bonds |
||||
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
|
14.50 15-Jul-21 |
6.68 |
5.96 |
(0.02) |
|
16.39 27-Jan-22 |
6.94 |
5.17 |
0.25 |
|
12.75 27-Apr-23 |
8.34 |
7.32 |
(0.33) |
|
14.20 14-Mar-24 |
8.79 |
7.86 |
0.17 |
|
13.53 23-Mar-25 |
9.47 |
6.97 |
0.00
|
|
12.50 22-Jan-26 |
9.87 |
9.20 |
0.04 |
|
16.29 17-Mar-27 |
10.38 |
9.90 |
0.00
|
|
13.98 23-Feb-28 |
10.58 |
9.99 |
0.13 |
|
12.15 18-Jul-34 |
11.09 |
10.27 |
0.07 |
|
12.40 18-Mar-36 |
10.93 |
10.31 |
0.12 |
|
16.2499 18-Apr-37 |
10.99 |
10.29 |
(0.06) |
|
14.80 26-Apr-49 |
12.26 |
12.05 |
0.04 |
|
Treasury Bills
The Treasury Bills market continued its bearish
outlook, as we continue to see an uptick in yields across the OMO curve. The
long-end had improved offers with January OMO bills gathering the most
traction, with supply coming mostly from offshore investors, who continue to
take advantage of the profitably spread between the primary OMO market and
secondary market. Yields compressed by c.1bp across the benchmark OMO curve.
The NTB side traded on a somber note, as the
unattractiveness of yields across the NTB curve caused local investors to
sell-off, heralding interest in other Federal government-backed instruments e.g
Promissory notes etc. Yields expanded by an average of c.24bps across the
benchmark NTB curve.
We expect the bearish outlook to persist going into
tomorrow's session, as banks sell-off, looking for short term fixes to aid
funding cost, till respite comes via the OMO maturity window.
Benchmark OMO Bills |
|||
Description |
Bid (%) |
Offer (%) |
Day Change
(%) |
NGOMO 19-Mar-20 |
13.00 |
12.25 |
0.00 |
NGOMO 2-Apr-20 |
12.90 |
9.00 |
0.05 |
NGOMO 14-May-20 |
12.85 |
9.00 |
0.00 |
NGOMO 4-Jun-20 |
13.00 |
9.00 |
0.15 |
NGOMO 2-Jul-20 |
12.90 |
9.00 |
0.05 |
NGOMO 13-Aug-20 |
12.85 |
11.00 |
0.00 |
NGOMO 3-Sep-20 |
12.85 |
11.05 |
0.00 |
NGOMO 1-Oct-20 |
12.85 |
11.00 |
0.00 |
NGOMO 3-Nov-20 |
12.90 |
11.00 |
0.05 |
NGOMO 1-Dec-20 |
12.85 |
11.10 |
0.00 |
NGOMO 5-Jan-21 |
12.75 |
12.00 |
(0.10) |
NGOMO 02-Feb-21 |
12.50 |
11.00 |
(0.35) |
Benchmark
NTBills |
|||
Description |
Bid (%) |
Offer (%) |
Day Change
(%) |
NIGTB 2-Apr-20 |
5.00 |
1.00 |
(2.00) |
NIGTB 2-Jul-20 |
6.00 |
1.00 |
(1.50) |
NIGTB 1-Oct-20 |
8.00 |
2.00 |
1.00 |
NIGTB 14-Jan-21 |
8.95 |
2.00 |
1.95 |
NIGTB 11-Feb-21 |
9.00 |
3.60 |
2.00 |
Money Market
Interbank rates remained in double-digit figures, despite system
liquidity figures opening with c.N205.70bn, as banks are still feeling the
effect of last week's CRR debit. OBB and OVN closed at 14.67% and 15.42%
respectively.
We expect rates to remain unchanged, with no liquidity respite expected
until Thursday (OMO maturities).
Money Market Rates |
||
|
Current (%) |
Previous (%) |
Open
Buy Back (OBB) |
14.67 |
14.83 |
Overnight
(O/N) |
15.42 |
15.58 |
FX Market
At the Interbank, the Naira/USD spot rate and SMIS
rate remained unchanged to close at N307.00/$ and N358.51/$. The Naira
depreciated at the I&E FX window, gaining 55k to close at N366.01/$.
The parallel market, the cash and transfer rate
remained unchanged at N358.30/$ and N367.00/$ respectively.
FX Market |
||
Current
(N/$) |
Previous (
N/$) |
|
CBN
Spot |
307.00 |
307.00 |
CBN
SMIS |
358.51 |
358.51 |
I&E
FX Window |
366.01 |
365.46 |
Cash
Market |
358.30 |
358.30 |
Transfer
Market |
367.00 |
367.00 |
Eurobond
The NGERIA Sovereign tickers
continued to rally across the sovereign yield curve, as investors continue to
trade oil price sentiment, supported by a c.3.82% increment D/D in oil prices,
despite the U.S Federal Reserve cutting rates by c.50bps, as it looks to combat
the Coronavirus scourge. Yields dropped by an average of c.9bps across the
sovereign yield curve.
The NGERIA Corps tickers traded on bullish sentiment, with yields
on the SEPLLN 2023s still strengthening by c.4bps D/D. Also, yields on the
ACCESS 2021s and FIDBAN 2022s dropped by c.1bps apiece.
Related News
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of PMA
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362-DTM Closing at 13.00%
4. Another Positive Outcome for the DMO At the February 2020
Auction
5. The Bulls Still Out in the T-Bills Market as DMO Drops
Rates
6. DMO Request for EOI for the Appointment of the
Transaction Parties for the Issuance of FGN Eurobonds
7. Treasury Bill Auction Holds On Wednesday Feb 26th, 2020
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V and VI Now Open
9. Anchoria Fixed Income Monitor: CBN Regulates Customer's
Deposit in Domiciliary Account
10. NT-Bills Average Yield Up 7bps WoW to 3.9%; Coronation MB
CP Available
11. OMO Yields Drop Further in the T-Bills Market as the
Long-dated Maturities Trade below 12% Levels
12. Nigeria Has A Good Chance To Boost Its Reserves And
Prevent Devaluation In 2020 - Coronation MB