What To Expect From The Markets This Week - 110121


Saturday, December 09, 2021 07:30 AM / Proshare ContentHeader Image Credit: EcoGraphics


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Nigeria: Economic Dashboard @ 090121

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Editor's Note

Source: Proshare Research - January 09, 2021

Nigeria Economy

  • According to data released by the National Bureau of Statistics, the total credits to the manufacturing industry as of Q3 2020 increased Q-o-Q by +15.3% to N3.03trn. The manufacturing industry received 15.25% of N19.87trn which was the total credit allocated to the private sector in Q3 2020.
  • The Transmission Company of Nigeria announced on Thursday that Nigeria recorded an all-time peak power generation of 5,552.8MW which surpassed the previous peak generation of 5,520.4MW on October 30, 2020. The new all-time peak surpasses the previous highest power generation figure by 32.4MW.
  • The latest data on trade from NBS reveals that importation of manufactured goods gulped a total of N9.28trn in the first nine months in 2020. There was a Q-o-Q increase in the value of imported manufactured goods by +23.18%, while it increased by +23.47% Y-o-Y. A total of N3.83trn was spent importing manufactured goods in Q3 2020 while N2.78trn and N2.66trn were spent in Q2 and Q1, respectively.
  • Personal statements of some members of the Monetary Policy Committee released by the CBN reveals that bank credits to the productive sectors rose by N3.97trn in 18 months after the commencement of the LDR initiative of CBN. It further notes that growth in the money supply increased slightly to 3.53% in October 2020 from 3.2% in September 2020, reflecting an increase in net foreign assets.
  • Despite the coronavirus pandemic, the Nigeria Customs Service said that it generated N1.56trn in 2020. The amount generated was above the projected revenue of N1.38trn and above N1.34trn generated in 2019.


Global Economy

  • World Bank downgraded the outlook for the global economy. It cautioned that the situation could worsen if the number of infections increases and inoculation is being delayed. The global economy is projected to grow by +4.0%, two-tenths lower than previously forecasted.
  • Britain Chancellor Rishi Sunak has announced that a support package of £4.6bn would be offered as a support package for businesses to soften an expected recession caused by a surge in COVID-19 cases which triggered a third national lockdown.
  • German retail sales grew by +4% in 2020. Retail sales rose +1.9% in November in contradiction with analyst expectations of a contraction. The improvement in retail sales could be attributed to strong growth in online sales and in spending on home improvements. A further breakdown of the data reveals that spending on household decorations, appliances, and building materials rose by +15.4% while clothing sales declined by -20% and mixed retail declined by -6.1%.
  • Singapore's economy contracted by -5.8% Y-o-Y in 2020, while it grew by +2.1% Q-o-Q in Q4 2020. Singapore's trade-dependent economy was hit by a plunge in activities in 2020, as economies imposed lockdown to halt the spread of the virus. A further breakdown of the growth figures shows that goods-producing industries grew by +3.3% Y-o-Y, while the manufacturing sector expanded by +9.5% Y-o-Y. The construction sector contracted for the 4th straight quarter in 2020, contracting by -28.5% Y-o-Y in Q4 2020.

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Commodities Market

Weekly Review and Outlook


  • Oil prices slipped from multi-month highs to end more than 1% lower on the first trading day of the year after OPEC+ failed to decide on Monday whether to increase output in February.
  • Oil prices climbed nearly 5% on Tuesday after the groups agree to lift oil production by 75,000 barrels per day over January levels.
  • Saudi Arabia's late announcement after the meeting sent oil prices soaring, the world's largest exporter would voluntarily cut an additional 1 million barrels per day in February and March above its current quota - all while OPEC's allies get to ramp up production.
  • Saudi Arabia's surprise cut lifted oil prices through the week, hitting an 11-month high on Thursday.
  • Brent had a weekly growth of +8% (see Table 1).


  • Gold futures dropped Wednesday after rising by nearly 3% on Monday, as U.S. 10-year Treasury yields jumped above 1% for the first time since March, dulling demand for the precious metal.
  • Gold depreciated by -0.6%, a reversal from the gain recorded in the previous week. Silver inched up by +0.4% W-o-W (see Table 1).


  • Cocoa prices declined by -2.9% this week.
  • Corn prices grew by +3.3% W-o-W while Sugar also appreciated by +2%  (see Table 1).

Table 1Weekly Change in Commodity Prices





Weekly Chg






































Source: Bloomberg, Proshare Research

*Data for 8th Jan, 2021 is as of 3:12 pm (Nigerian Time)



  • In the coming week, oil prices are expected to continue their steady rise as OPEC and non-OPEC allies comply with their output curbs, while the middle east tensions will also help support prices, but lockdowns and Restrictions in various parts of the world to curtail the spread of the new strain will likely pare gains.
  • Gold prices are expected to rise in the coming week, as a significantly increased economic stimulus is expected as the democrats dominate the U.S. Senate.
  • Lockdowns across Europe could further weaken demand for cocoa, keeping prices low for the upcoming week
  • Low supply from Brazil and Thailand to keep sugar prices high.
  • Corn prices to rise during the coming week, as dry weather continues to threaten corn yields prospects in Argentina, labour issues in the south American country has also added to concerns about supplies

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Fixed Income and Money Market 


Money Market

Money market rates started the week/year high despite robust system liquidity estimated at N746.26bn, although it wasn't maintained throughout the week as a result of an increase in liquidity in the system. At the close of the trading session in the week, Open Buyback (OBB) increased significantly to close at 8.0% while Overnight (O/N) rates closed at  9.33% indicating a Week-on-Week (W-o-W) rise of over +1000% for both OBB and O/N rates.

Money Market Rate




% Change









Source: FMDQ, Proshare Research

Rates are expected to trend lower in the absence of funding obligations.


Treasury Bills Market

The trading session at the start of the year for The Nigerian Treasury Bills market (NTB) started in a quiet mood, although, the market had a bullish trend during the week.


At the end of the week, the buy-interest outstripped the sell interest for the NTB instrument. The average benchmark yields for the T.Bills fell W-o-W by -6.52% to close at 0.43% while OMO bills rose significantly by +46.55% to close at 0.85%.

Average Benchmark Yields



% Change

T. Bills (%)




Omo Bills (%)




Source: FMDQ, Proshare Research

Participation in the NTB market is expected to be mixed as investor interest could either sway to the buy-interest or sell-interest considering the tight investment opportunity space.


FGN Bond Market

The trading session for the FGN Bond market started the year on a bearish note as investors braced up for the January bond issuance calendar which is yet to be released by DMO. This trend continued throughout the week as the average benchmark yield for the week rose to 3.23%.


Average Benchmark Yields




% Change

Short Tenor




Mid Tenor




Long Tenor





Also, BUA Cement PLC, one of Africa's largest cement companies, concluded its N100billion Series 1 Fixed Rate Senior Unsecured Bond Issue (the "Bond or Issue") under its maiden N200billion Bond Issuance Programme. The bond which was oversubscribed by +19.84% is a 7-year issue and has a fixed rate of 7.5%, due to regulatory guidelines the Company was able to absorb 15% of the excess which amounted to N15bn, therefore the entire Series 1 issue amounted to N115bn.


The FGN through the DMO also offered January savings bonds for 2 years and 3 years tenor with interest rates at 2.197% and 3.197% respectively.


We expect the market to continue in a bearish trend in the coming week as investors await the Q1 bond issuance calendar.


FGN Eurobond Market

The trading session in the Eurobond market for the week was mixed even though average benchmark yields fell by 1 base point (bp) at the start of the week. This was driven by an uptick in crude oil prices. The lockdown measures in the UK sent a negative signal to the market during the week, however, positive investor sentiment was supported by Saudi Arabia crude oil production cuts at the close of the week.


We expect the market to continue the bearish trend although on a less aggressive note as a result of the increase in COVID-19 cases.


Foreign Exchange Market

At the I&E FX window, the Naira appreciated against the USD by +4.08% while at the BDC market it depreciated by +0.43% week-on-week (W-o-W).


The Naira closed the week at $/N393.5 at the I&E FX window, at the NAFEX (spot market) it closed at $/N392.18, and at the BDC market, it closed at $/N470, £/N625, and Euros/N573. 

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Nigerian Capital Market

  • The Nigerian Bourse opened the year 2021 with a decline of -0.37% WoW as investors lose N78.69bn WoW; YTD return and market capitalization currently stand at +49.47% and N20.98trn. The volume and value of stocks traded on the exchange this week dipped by -53.10% and -63.81% respectively.


  • A total turnover of 3.39bn shares worth N19.87bn in 26,808 deals was traded this week by investors on the floor of the Exchange; The most traded stocks by volume were CHAMPION, TRANSCORP, and ACCESS accounting for 2.14bn shares worth N6.00bn in  1,971 deals, contributing 63.18% and 30.21% to the total equity turnover volume and value respectively.

  • Performance across sectors was broadly positive for the week, NSE Oil and Gas was the highest advancer for the week with an increase of +13.16%, NSE-30, NSE Banking, NSE Consumer goods and, NSE Insurance advanced this week by +0.06%, +3.21%, +2.58 and, +9.49% respectively. NSE-IND recorded the highest decline with -2.29% WoW.

  • Market breadth was positive for the week with 50 gainers led by JAPAUOIL and BOCGAS as against 21 losers led by DEAPCAP and ROYALEX.

  • On January 6, 2021, the National Council of The Nigerian Stock Exchange announced the Chief Executives that will head its operating and non-operating companies upon the completion of its ongoing demutualization process.

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Chart 1: Movement of NSEASI Index Points 04 Jan.2021 - 08 Jan.2021

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The NASD OTC Security Index (NSI) and Market Capitalization closed the trading week with a positive movement in Market capitalization and NSI. The NSI and Market capitalization closed the week at 752.34 points and N539.81bn with a growth of +2.64% and +2.64% respectively. 


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Dangote and Toni Index 


Dangote Index closed the week negative at 119.68 basis points from 129.03 basis points recorded the previous week, a decline of -7.25% DANGCEM recorded decline in share price by -8.13%. DANGSUGAR gained +8.81% WoW while NASCON  closed flat WoW. DANGCEM recorded the highest loss WoW.


Table 2: Dangote Index W-o-W Change

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Furthermore, the Toni Index closed positive to close at 105.92 basis points from 129.03 basis points recorded the previous week, a W-o-W growth of +3.32%UBA closed the week positive with +2.31%, TRANSCORP, UBCAP, AFRIPRUD also closed positive with +8.89%, +6.16%, and +11.68%respectively. TRANSCOHOT closed flat WoW.



Table 3: Toni Index W-o-W Change

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