What To Expect From The Markets This Week - 290321


Saturday, March 27, 2021 08:00 AM / Proshare Content / Header Image Credit: EcoGraphics


Nigeria: Economic Dashboard @260321   

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Editor's Note

Source: Proshare Research - March 27, 2021

Nigeria Economy

  • According to the CBN, currency in circulation in the country declined by N50bn to N2.78trn in February 2021 from N2.83trn as of January. The CBN stated that it employed the "accounting/statistical/withdrawals & deposits approach" to compute the currency in circulation in Nigeria. This approach involved tracking the movements in currency in circulation on a transaction-by-transaction basis.
  • According to NBS, petrol topped the list of products imported into the country, accounting for 11.7% of the total amount spent on imported products from January to September. The amount spent on the importation of PMS increased by +17.54% to N2.11trn in 2020 from N1.71trn in 2019.
  • Bank of Industry (BOI) under the supervision of the Federal Ministry of Industry, Trade and Investment concluded a $1bn syndicated term loan in conjunction with international partners to support Micro, Small & Medium Scale Enterprises in the country. According to the Minister of Industry, Trade & Investment Mr. Adeniyi Adebayo, the loan is aimed at improving the bank's capacity to support MSMEs across key sectors of the economy with affordable loans of medium to long-term tenor, alongside moratorium benefits.
  • Selected food price watch data for February 2021 reflected that the average price of 1 dozen of Agric eggs medium size increased year-on-year by +15.62% and month-on-month by +1.46% to N518.30 in February 2021 from N510. 84 in January 2021 while the average price of a piece of Agric eggs medium size (the price of one) increased year-on-year by 20.50% and month-on-month by +2.47% to N47.35 in February 2021 from N46.21 in January 2021. The average price of 1kg of tomato increased year-on-year by +11.33% and decreased month-on-month by -7.07% to N269.18 in February 2021 from N289.66 in January 2021. The average price of 1kg of rice (imported high quality sold loose) increased year-on-year by +21.02% and decreased month-on-month by -2.57% to N537.37 in February 2021 from N551.57 in January 2021. Similarly, the average price of 1kg of yam tuber increased year-on-year by +28.11% and month-on-month by +3.47% to N242.82 in February 2021 from N234.67 in January 2021. 

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Global Economy

  • UK inflation rate declined in February to 0.4% as the third coronavirus lockdown led to a wave of discounting by clothing retailers and secondhand car dealers. The cost of food, non-alcoholic drinks, games, toys, and hobbies also increased in price at a lower rate than in the previous month. Only a rise in the cost of petrol and diesel at the pumps which sent transport costs higher, prevented inflation from falling further towards zero.
  • According to the latest PMI data compiled by IHS Markit and CIPS, the UK's business activity returned to growth in March, led by the fastest increase in service activity since August 2020. The improvement was fuelled by a rise in new orders for the first time since September 2020, which firms attributed to a rebound in sales ahead of easing lockdown measures, alongside stronger consumer confidence and a surge in demand for residential property services. Flash UK Composite Output Index stood at 56.6 in March, Flash UK Services Business Activity Index 56.8, Flash UK Manufacturing Output Index 55.6, and Flash UK Manufacturing PMI 57.9.
  • The flash estimates from IHS Markit showed that Euro zone business activity returned to growth in March, fuelled by a survey record increase in manufacturing output as global demand continued to revive from the pandemic. Flash Eurozone PMI Composite Output Index stood at 52.5 in March, Flash Eurozone Services PMI Activity Index 48.8, Flash Eurozone Manufacturing PMI Output Index 63.0, and Flash Eurozone Manufacturing PMI 62.4.
  • The International Financial Corporation (IFC) on Monday signed an agreement with Somalia to help boost the public-private partnerships (PPPs) in the country. The accord aims at helping in the improvement of the delivery of services, creation of jobs, and enhancement of economic wealth as the Somali government plans to encourage private investment in various sub-sectors.
  • Kenya's exports to key markets in Africa rose to an eight-year high in 2020, provisional international trade data show, defying delays at border points caused by efforts to stem the spread of the global coronavirus pandemic. Data collated by the Central Bank of Kenya (CBK) indicate the value of goods that were sold to other countries on the continent amounted to Sh243.68 billion, a 9.07 percent growth over the previous year. The growth in value of trade between Kenya and Africa to the highest level since 2012 (Sh247.60 billion) was largely driven by demand in smaller export destinations on the continent.

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Commodities Market

Weekly Review and Outlook


  • Earlier in the week, Nigerian fuel marketers raised the price of Automotive Gas Oil, also known as diesel, to a new high of N265 per litre against the backdrop of the recent rise in global oil prices.
  • On Monday, Oil prices steadied as hopes of a pick-up in demand later this year helped limit last week's broad sell-off, but prices stayed under pressure as new European coronavirus lockdowns made a quick recovery look less likely.
  • Oil prices plunged about 6% on Tuesday, falling even lower in post-settlement trade, as concerns over new pandemic curbs and slow vaccine rollouts in Europe added to oversupply uneasiness.
  • Prices rebounded about 6% on Wednesday after a ship ran aground in the Suez Canal, and worries that the incident could tie up crude shipments gave prices a boost after a slide over the last week.
  • Oil prices fell 4% per barrel on Thursday, extending a string of market weakness on renewed lockdowns in Europe and Asia to head off a rising coronavirus infection rate.
  • On Friday, Oil prices reversed a sharp sell-off a day earlier to rise 1% on mounting fears that it could take weeks to dislodge a giant container ship blocking the Suez Canal, which squeezes supplies of crude and refined products.
  • Brent had a weekly growth of 0.48% (see Table 1).


Gold depreciated by -0.41%, while Silver also dipped by -4.32%W-o-W (see Table 1).


  • Cocoa prices declined by -1.81% this week.
  • Corn prices declined up by -1.48% W-o-W while Sugar also plunged by -3.19% (see Table 1).


Table 1Weekly Change in Commodity Prices





Weekly Chg






































Source: Bloomberg, Proshare Research

*Data for 26th Mar 2021 is as of 4:30 pm (Nigerian Time)




  • In the coming week, oil prices are expected to rise with the Suez blockage likely to last for weeks, consequently squeezing supplies of crude and refined products.
  • Gold prices are expected to be mixed in the coming week,  as strengthening dollar and rising Treasury yields continue as headwinds for the yellow metal.
  • Cocoa prices to decline next week amid concerns that demand in Europe could be curbed as another wave of the COVID-19 pandemic hits the continent.
  • Sugar prices are expected to dip next week due to the lack of demand and oversupply.
  • Corn prices are expected to be little changed in the coming week as traders look ahead to U.S. planting estimates next week while also assessing harvest prospects in South America.

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Fixed Income and Money Market 


Money Market

Funding rates for the week continued its double-digit trend despite system liquidity estimated to be over N100bn.


At the close of the trading session this week, Open Buyback (OBB) closed at 10.50% while Overnight (O/N) rates closed at 10.75% indicating a Week-on-Week (W-o-W) significant decline of -58.00% for OBB and -57.84% for O/N rates.


Money Market Rate




% Change









Source: FMDQ, Proshare Research

Rates are expected to continue to trend in double-digit supported funding obligations.


Treasury Bills Market

The trading session for the Nigerian Treasury Bills started the week quiet, however, trading ended bearishly.


At the close of the week, there was a significant uptick in average benchmark yields for the T-bills, it increased W-o-W by +21.55% to close at 4.23%, and OMO bills yields fell by -0.61% to close at 6.55%. Yield for CBN's Special bills also saw an uptick of +8.49% W-o-W.


Average Benchmark Yields



% Change

T. Bills (%)




OMO Bills (%)








Source: FMDQ, Proshare Research


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FGN Bond Market

The FGN bond market continued its quiet trend this week, as investor attention was skewed towards the March bond auction in the week and the outcome of the MPC meeting. At the close of the week, the market ended in bearish notes as selling pressure was seen majorly at the short and long end of the curve.


Overall average benchmark yields closed at 6.83% for the week which increased W-o-W by +9.15%.


Average Benchmark Yields



% Change

Short Tenor (%)




Mid Tenor (%)




Long Tenor (%)




Source: FMDQ, Proshare Research


The Debt Management Office (DMO) sold N262.10 billion worth of bond against N150.00 billion offered at its bond auction today. The 10-year, 15-year & 25-year bonds were allotted at 10.50%, 11.50%, & 12.00% respectively.


Primary Market Auction Result - March Bonds


Amount Offered (N'bn)

Total Subscription (N'bn)

Amount Allotted (N'bn)

Marginal Rates (%)

10 Year





15 Year





25 Year





Source: DMO, Proshare Research

FGN Eurobond Market

The FGN Eurobond market continued its bearish trend this week as market sentiment remains soft on the back of the rising US treasury yields stoked by inflationary concerns and crude oil price concerns.


Average benchmark yields rose by +5.76% to close at 6.35% at the end of the week.


Seplat announces that it has priced its offering of $650 million in aggregate principal amount of 7.75% senior notes due 2026 (the "Notes"). The Notes will be issued by the Company and guaranteed by certain of its subsidiaries. The gross proceeds of the Notes will be used to redeem the existing $350 million 9.25% senior notes due 2023, to repay drawings of $250 million under the existing $350 million revolving credit facility, for general corporate purposes, and to pay transaction fees and expenses.


For the FGN Eurobond market, we expect the market to continue to react to the news both on the domestic level and international level especially to movement in crude oil prices and the US treasuries.


Foreign Exchange Market

The Naira closed flat W-o-W against the USD at the BDC window, for the I & E FX market it also remained unchanged. At the BDC window, the Naira against the British Pound and Euro appreciated W-o-W by +0.44% and +0.35% respectively.


The Naira closed the week at $/N410 at the I&E FX window, at the NAFEX (spot market) it closed at $/N407.55, and at the BDC market, it closed at $/N485, £/N675, and  Euros/N576. 

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Nigerian Capital Market

  • Investors' sentiment on the market was positive as investors reacted to dividends declared by blue-chip stocks such as DANGCEM, LAFARGE and STANBIC. The Nigerian bourse closed the week positive as Investor Sentiment on the market was mixed on the equities market with a growth of +2.17%. The Nigerian Stock Exchange gained N436.25bn in Market capitalization W-o-W while YTD return and market capitalization currently stands at +46.10% and N20.52trn respectively.
  • The volume and value of stocks traded on the exchange this week declined by -13.66% and -30.56% respectively. A total turnover of 1.53bn shares worth N21.31bn in 20,016 deals was traded this week by investors on the floor of the Exchange.
  • Performance across sectors was positive this week as all tracked sectors closed positive the NSE Ind Banking Index was the highest gainer for the week with a gain of +2.94%, NSE-30, NSE Consumer Goods, NSE Insurance, NSE Oil and Gas and NSE Banking advanced by +0.21%, +2.64%, +1.41%, +0.94% and +0.69% respectively.
  • The African Development Bank on Tuesday launched the second phase of the West African Capital Markets Integration (WACMI) Project to establish a common securities listing and trading platform across West African bourses. In December 2020, WACMI received a grant of $850,000 from the Capital Markets Development Trust Fund (CMDTF), a multi-donor fund administered by the African Development Bank and supported by Luxembourg and the Netherlands.

Phase 2 of the integration project, financed by the grant, entails harmonization of regulations in participating capital markets as well as building capacity of market regulators and operators to handle cross-border investments.

  • The monetary policy committee decided to retain the MPR at 11.5%

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Chart 1: Movement of NSEASI Index Points 19 Mar. 2021 - 26 Mar 2021

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Source: NSE, Proshare Research


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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 710.73 points and N505.20bn with a growth of +2.14% and +2.14% respectively.



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Dangote and Toni Index 


Dangote Index closed the week positive with 118.77 basis points from 116.47 basis points recorded the previous week, a growth of +1.97%. DANGSUGAR recorded a decline in share price by -3.53%, NASCON advanced by +2.01% while DANGCEM advanced by +2.27% WoW. DANGSUGAR recorded the highest decline W-o-W.


Table 2: Dangote Index W-o-W Change

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In addition, the Toni Index closed negative with 84.84 basis points from 88.01 basis points recorded the previous week, a W-o-W decline of -3.60%AFRIPRUD, UBA  and TRANSCORP  closed the week negative with -1.87%, -4.90% and -1.22% respectively, UBCAP closed the week positive with +0.59% while TRANSCOHOT closed flat WoW.


Table 3: Toni Index W-o-W Change

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In the coming week, we expect astute investors to take positions in dividend-paying stocks as more companies release their full-year 2020 corporate earnings although full year result season is gradually coming to an end.


In addition, we expect investors to monitor the bond auction results and focus on movement of yields in the fixed income market.

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Latest Reports This Past Week

1.      Average Price of 1kg of Tomato Increased by 11.33% YoY in February 2021 - NBS

2.     Average Fare Paid by Commuters for Intercity Journey Increased by 1.13% MoM in February 2021 - NBS

3.     FAAC Disburses N619.34bn in January 2021 - NBS

4.     NBS Publishes COVID-19 Impact Monitoring Survey Report for January 2021

5.     Active Voice Subscribers Declined by -0.32% QoQ in Q4 2020 - NBS

6.     Headline Inflation Increases by 17.33% YoY In February 2021, 0.86% Higher Than January 2021 Rate

7.     Nigeria's Unemployment Rate Increases to 33.3% in Q4 2020 from 27.1% in Q2 2020 - NBS

8.     NBS Publishes COVID-19 Impact Monitoring Survey Report for Nov-Dec 2020

9.     FAAC Disburses N2.49trn to FG and N2.30trn to States in Year 2020 - NBS

10.  FAAC Disburses N604.00bn in November 2020 - NBS

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