What To Expect From The Markets This Week - 180121


Saturday, December 16, 2021 07:50 AM / Proshare ContentHeader Image Credit: EcoGraphics


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Nigeria: Economic Dashboard @ 150121 

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Editor's Note

Source: Proshare Research - January 16, 2021

Nigeria Economy

  • According to the CBN, the top 10 non-oil exporters in Nigeria exported $57.74m goods in August 2020. The amount earned by the top 10 exporters in Nigeria, declined by -22.8% from $74.48m worth of goods in July to $57.74m goods in August 2020. The top three non-oil exporters in August 2020 were Olam Limited which exported cocoa beans, cashew nuts, and sesame seeds to Turkey and China worth $15.11m, Starlink Global and Ideal Ltd exported cocoa beans worth $6.79m to Malaysia. The third major non-oil exporter was Dangote Cement Plc which exported Dangote portland limestone cement to Togo and the Niger Republic worth $5.71m.
  • Data from the Association of Nigerian Electricity Distributors showed that electricity consumers paid N362bn out of the N520bn billed by distribution companies in the country in the first nine months of 2020. This represents a default of N158bn, 30.38% of energy billed. The discos' revenue collected increased to N130bn in Q3 from N105bn in Q2 and N125bn in Q1.
  • Egbin and Shiroro output hit a record high on Tuesday, January 12th, 2021. Egbin output rose from 721MW as of 6 a.m on Monday to 913MW on Tuesday. Furthermore, the Shiroro hydropower plant generated a record high of 554MW as of 6 a.m on Tuesday from 400MW on Monday and 161MW on January 1st.
  • Nigeria's inflation rose by 15.75% Y-o-Y in December 2020, which is 0.86 percentage points higher than the rate recorded in November 2020 (14.89%). The composite food index rose by 19.56% in December 2020 compared to 18.3% in November 2020. The rise in the food index was caused by increases in prices of bread and cereals, potatoes, yam, and other tubers, meat, fruits, vegetable, fish, and oils & fats. Core inflation stood at 11.37% in December 2020, up by 0.32 percentage points when compared with 11.05% recorded in November 2020.

Global Economy

  • German's economy shrank by -5% last year, according to official figures, among the smallest declined anticipated in Europe despite the coronavirus pandemic causing the deepest recession since the 2008 financial crisis. German recession will be less severe when compared to other European economies expected to contract worse. Italy is expected to contract by -9%, France -9%, and UK -11.3%.
  • The International Air Transport Association in its economics chart for the week explained that ticket purchases rising towards the third week of December reversed in the same month. It stated that this development would impact travel as well as revenue for airlines in 2021. Furthermore, according to its data, there will most likely not be any significant improvement in passenger volumes in the near term.
  • The U.S government recorded an increase in its December 2020 budget deficit of $144bn from $13bn deficit in December 2019 before the advent of the pandemic. The rise in the budget deficit was due to far higher outlays with coronavirus relief spending and unemployment benefits, while revenues ticked slightly higher.
  • US President-elect Joe Biden on Thursday unveiled the details of a $1.9trn coronavirus rescue package. The plan is the first of two major spending initiatives Biden will seek in the first few months of his presidency. Some of the details of the plan include direct payments of $1,400 to most Americans, increasing the federal minimum wage to $15 per hour, extending the eviction and foreclosure moratoriums until the end of September, $350bn in state and local government aid, $50bn toward Covid-19 testing, etc.
  • The Chinese Q4 GDP growth rate is expected to be released on the 18th of January 2021. Analysts have forecasted that the Chinese economy would record its best quarterly growth for 2020 in Q4 2020. The Chinese economy contracted in Q1 by -6.8% while it returned to the path of growth in Q2 and Q3 2020 recording growth rates of +3.2% and +4.9% respectively.

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Commodities Market

Weekly Review and Outlook


  • Oil prices steadied on Monday after strong gains last week, as tough coronavirus lockdowns around the world renewed concerns about global fuel demand, while a stronger dollar weighed on prices.
  • Oil prices rallied on Tuesday after American Petroleum Institute (API) reported crude oil inventories of 5.821m for the week ending January 8.
  • Prices fell on Wednesday, pulling back from recent gains, on concerns that rising global COVID-19 will hamper global fuel demand.
  • On Thursday, oil prices edged higher, boosted by a weak dollar and bullish signals from Chinese import data.
  • Brent had a weekly growth of +0.4% (see Table 1).


  • Gold was quite shaky this week, as a firmer dollar and high Treasury yields weighed on prices.
  • Gold depreciated by -2.5%, extending losses recorded in the previous week. Silver declined by -6.3% W-o-W (see Table 1).


  •  Cocoa prices declined by -0.9% this week.
  • Corn prices grew by +7.2% W-o-W while Sugar also appreciated by +3.6% (see Table 1).

Table 1Weekly Change in Commodity Prices





Weekly Chg






































Source: Bloomberg, Proshare Research

*Data for 15th Jan 2021 is as of 3:23 pm (Nigerian Time)



  • In the coming week, oil prices are expected to rise marginally as Saudi Arabia’s Voluntary output cuts continue to stabilize the market coupled with U.S. plans for a large stimulus package, gains are expected to be capped by rising coronavirus cases in China and Europe.
  • Gold prices are expected to rise in the coming week, likely to garner support from a weak dollar, stimulus expectations, and depressed real interest rates.
  • Lockdowns across Europe could further weaken demand for cocoa, keeping prices low for the upcoming week.
  • Low supply from the European Union and Thailand is expected to keep prices high.
  • Corn prices to remain stable in the coming week, as Argentina ends a strike over corn export restrictions and near-term development weather looking good for most of Argentina and Brazil.

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Fixed Income and Money Market 


Money Market

Money market rates trended lower as the week started on robust system liquidity estimated at N132.7bn. The trend was maintained for the most trading session of the week, at the close of the trading session in the week, Open Buyback (OBB) closed at 0.50% while Overnight (O/N) rates closed at 1.00% indicating a Week-on-Week (W-o-W) significant decline -93.75% for OBB and -89.28% for 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 overall trading session of the Nigerian Treasury Bills market (NTB) was bearish. At the start of the week average benchmark yield rose by 4bps, the bearish trend continued during the week although on a less aggressive tone.

At the close of the week, the average benchmark yields for the T-bills rose W-o-W by +18.60% to close at 0.51% while OMO bills declined by -10.59% to close at -0.76%.

Average Benchmark Yields



% Change

T. Bills (%)




OMO Bills (%)




Source: FMDQ, Proshare Research

Participation in the NTB market is expected to be quiet as depressed yields persist.


FGN Bond Market

The trading session for the FGN Bond market for the week was mixed as investor sentiment was mixed as investors braced up for the First Quarter bond issuance calendar which was released by DMO during the week. Average benchmark yields closed flat for the week at 3.23%.


Average Benchmark Yields




% Change

Short Tenor (%)




Mid Tenor (%)




Long Tenor (%)





FMDQ approved the quotation of the Total Nigeria PLC N2.25 billion Series 1 and N12.75 billion Series 2 Commercial Papers under its N30.00 billion CP Issuance Programme and the Mixta Real Estate PLC N2.00 billion Series 32 Commercial Paper under its N20.00 billion CP Issuance Programme, as well as the registration of the Valency Agro Nigeria Limited N20.00 billion Commercial Paper Programme, on its platform.


Also, during the week, The Central Bank of Nigeria on the authority of The Debt Management Office on behalf of the Federal Government of Nigeria Offered for Subscription by Auction:

  • N50,000,000,000 - 16.2884% FGN MAR 2027 (10-Yr Re-opening) *
  • N50,000,000,000 - 12.50% FGN MAR 2035 (15-Yr Re-opening) *
  • N50,000,000,000 - 9.80% FGN JUL 2045 (25-Yr Re-opening) *

Auction date is January 20, 2021, while the settlement date is January 22, 2021.


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 bearish at the start of the week, investor sentiment was negative as a result of renewed rising cases of COVID-19 in China. However, at the end of the week, yield rebounded marginally reacting to the uptick in the prices of Brent Crude.


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

It was a bearish market for the Naira this week against major currencies and at the different windows. At the I&E FX window, the Naira depreciated against the USD by -0.13% while at the BDC market it depreciated by -1.06% week-on-week (W-o-W).


The Naira closed the week at $/N394 at the I&E FX window, at the NAFEX (spot market) it closed at $/N393.68, and at the BDC market, it closed at $/N475, £/N642, and Euros/N580. 

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Nigerian Capital Market

  • The Nigerian Bourse closed the week with a growth of +2.63% WoW as investors gain N552.12bn in Market capitalization. WoW to close at N21.05trn. YTD return and market capitalization currently stands at +53.40% and N21.53trn. The volume and value of stocks traded on the exchange this week advanced by +100% and +75.32% respectively.
  • A total turnover of 3.45bn shares worth N32.73bn in 30,327 deals was traded this week by investors on the floor of the Exchange; The most traded stocks by volume
  • were UPDCREIT, MBENEFIT, and TRANSCORP accounting for 1.24bn shares worth N4.46bn in  929 deals, contributing 35.52% and 13.63% to the total equity turnover volume and value respectively.
  • Performance across sectors was broadly positive for the week, NSE Insurance was the highest advancer for the week with an increase of +17.48%, NSE-30, NSE Banking, NSE Consumer goods, NSE Oil & Gas and NSE-IND advanced this week by +8.47%, +2.53%, +3.11, +7.25% and, +2.84 respectively.
  • Market breadth was positive  for the week with 60 gainers led by JAPAUOIL and MBENEFIT as against 19 losers led by CUTIX and DAARCOMM.

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Chart 1: Movement of NSEASI Index Points 08 Jan.2021 - 15 Jan.2021

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The NASD OTC Security Index (NSI) and Market Capitalization closed the trading week with a negative movement in Market capitalization and NSI. The NSI and Market capitalization closed the week at 740.04 points and N530.99bn with a growth of -1.63% and -1.63% respectively. 


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Dangote and Toni Index 


Dangote Index closed the week positive at 126.46 basis points from 119.68 basis points recorded the previous week, an advancement of +5.66% DANGCEM recorded a growth in share price by +5.33%, DANGSUGAR gained +8.62% WoW and NASCON  closed positive by +21.03% WoW. NASCON  recorded the highest gain WoW.


Table 2: Dangote Index W-o-W Change

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Furthermore, the Toni Index closed positive to close at 109.88 basis points from 105.92 basis points recorded the previous week, a W-o-W growth of +3.74%UBA closed the week positive with +4.52%. UBCAP and AFRIPRUD also closed positive with +5.80% and +0.29% respectively. TRANSCOHOT and TRANSCORP closed flat WoW.


Table 3: Toni Index W-o-W Change

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With limited opportunities for high yields in other asset classes due to macroeconomic challenges and a high inflation rate environment, we expect the market to sustain the bullish momentum as investor sentiment remains positive in the equities market. 

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Previous Week(s) Market Outlook

1.      What To Expect From The Markets This Week - 110121

2.     What To Expect From The Markets This Week - 281220

3.     What To Expect From The Markets This Week - 211220

4.     What To Expect From The Markets This Week - 141220

5.     What To Expect From The Markets This Week - 071220

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2.     Covid Related Reports

3.     62.18% of Nigeria's Total Public Debt as of Q3 2020 Was Domestic - NBS

4.     Active Voice Subscribers Grew by 4.59% in Q3 2020 - NBS

5.     Headline Inflation Increases by 15.75% YoY In December 2020, 0.86% Higher Than November 2020 Rate

6.     Average Price of 1kg of Rice Increases by 23.46% YoY in November 2020 - NBS

7.     NBS Publishes COVID-19 Impact Monitoring Survey Report for October 2020

8.     Average Air Fare Increases by 18.47% YoY in November 2020 - NBS

9.     Capital Importation into Nigeria Stood At $1,461.49m in Q3 2020 - NBS

10.  Banking Sector Records 2.78bn Volume of Transaction in Q3 2020 - NBS

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