What to Expect from the Markets This Week - 170122


Saturday, January  15, 2022, / 07:30 AM / Proshare Content / Header Image Credit: EcoGraphics

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Nigeria: Economic Dashboard @ 140122

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Editor's Note

Source: Proshare Research - January 15, 2021

Nigeria Economy

  • The World Bank in its latest Global Economic Prospects report released on Tuesday, projects a 2.5% economic growth for Nigeria in 2022, and 2.8% in 2023. This 2022 forecast is an upward review from the estimated 2.4% growth projected earlier. According to the bank, higher oil prices and activities in the telecommunications sector and financial services, will drive growth up slightly. The Washington-based institution added that issues of violence and social unrest, alongside emerging COVID-19 threats, would restrain economic activities in the non-oil sector.
  • The Minister of Finance, Budget and National Planning, Dr. Zainab Ahmed, has charged the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) to focus on monitoring revenue collection and not get involved in the process of revenue collection. Citing paragraph 32 (a-e) of Part 1 to the Third Schedule of the 1999 Constitution, the Minister noted that the role of the Commission is to monitor accruals and disbursements of revenue from the Federation Account. While maintaining that the Federal Account is to be funded by four agencies of Government namely Federal Inland Revenue Service, the Nigeria Custom, the Department of Petroleum Resources and the Nigeria National Petroleum Corporation.
  • During the LCCI quarterly press conference the state of the Nigerian economy on Tuesday, the Lagos Chamber of Commerce and Industry advised the Federal Government to widen its tax net in order to increase its revenue. According to the chamber, government at all levels must ensure the creation of an enabling tax environment where the tax system is fair, equitable, and efficient to make tax payment easy. Commenting on Nigeria's debt stock, the chamber deplored the fact that a chunk of Federal Government revenue in 2021 is spent on debt servicing.
  • After 222 days and economic losses of about N546.5 billion, the Federal Government finally lifted the ban on Twitter operations in Nigeria. According to the Netblocks Cost of Shutdown Tool, Nigeria lost N104.02 million ($250,600) every hour to the ban, bringing the daily losses to N2.46 billion. As of Wednesday, the ban had lasted 222 days during which period the social networking site was blocked, and about N546.5 billion was lost by the economy.

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Global Economy

  • Official Customs data released on Friday shows that China's global trade surplus surged to $676.4 billion in 2021, - the highest ever for any country. Data shows that exports jumped 29.9% Y-o-Y this was despite semiconductor shortages that disrupted manufacturing. Meanwhile, the country's monthly trade surplus in December swelled 20.8% over a year earlier to a record $94.4 billion. Exports rose to $3.3 trillion in 2021 as global demand rebounded from the coronavirus pandemic. Manufacturing was also hampered by power rationing in some areas. Imports in 2021 rose 30.1% to $2.7 trillion.
  • U.S. inflation rate for December 2021 came in as expected at 7% - a 41 year high, suggesting that the world's largest economy's inflation worries are not abating. In December, the Consumer Price Index rose by 0.5% on a month-on-month basis. The December Inflation figure was due to higher prices for shelter, used cars and trucks. Prices for used vehicles went up by more than 37% Y-o-Y while Energy prices rose by about 29%, gasoline in particular increased by almost 50%. Jerome Powell on Tuesday warned that high inflation is a severe threat to the recovery and that the Fed would need to act to prevent it from becoming entrenched. Meanwhile, CPI rose in Canada also rose by 4.7%  in December- an 18-year high.
  • As part of its post-Brexit strategy, the UK government on Thursday announced the launch of free trade agreement (FTA) negotiations with India, describing it as an opportunity to put British businesses at the "front of the queue" of the Indian economy. The trade deal offers huge benefits for British businesses offering financial services and renewable technology. It has the potential to boost bilateral trade by up to GBP 28 billion a year by 2035 and increase wages by up to GBP 3 billion
  • Analysts at Goldman Sachs predicted that the euro area will outgrow the U.S. economy over the next two years. The projection is due primarily to the fact European fiscal policy is likely to remain accommodative this year, in contrast to what predictions are for the United States. Meanwhile, the investment bank expects the region to grow at a pace of 4.4% in 2021, compared to a rate of 3.5% for the United States.  As for 2023, Goldman foresees the euro zone growing by 2.5% and the U.S. by 2.2%.
  • According to U.S. Department of Labour jobless claims rose by 23,000 in the week ending Jan. 8 to reach 230,000. Weekly applications have risen in four of the past five weeks. Jobless claims had fallen mostly steadily for about a year dipping to below the pre-pandemic average of around 220,000 a week. Last week, the Labour Department shared its latest nonfarm payroll report, which found that only 199,000 jobs were added in December last year. 

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Review and Outlook

The World Bank upgraded Nigeria's growth forecast for 2022 by 10basis points from 2.4% to 2.5%. The Multilateral Institution identified expected improvements in the Service sector of the economy specifically the Telecoms and Financial services sectors. Crude oil prices are expected to rise but concerns about Insecurity would persist thereby threatening productivity in other sectors. The World Bank's projection of 2.5% is less optimistic than that of local fiscal authorities who project a growth of 4.2% in 2022.  A median forecast would probably be around 3.2% which still lags the growth rate of the country's population. Hence, the World banks projection that per capita income is expected to be lower in 2022 than a decade ago in Nigeria, and South Africa.  December Inflation data is expected in the coming week. Analysts forecast an inflation rate of about 15% to bring last year's average to about 16%.

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Commodities Market

Weekly Review and Outlook



  • The Federal Government of Nigeria through the Programme Manager, National Liquefied Petroleum Gas Expansion Implementation Plan, Dayo Adeshina, has said 12 states have been selected for the pilot phase of the conversation of vehicles using petrol and diesel to Autogas vehicles.
  • At least five domestic oil and gas companies are considering bidding for Royal Dutch Shell's onshore oilfields valued at between $2-3billion. The sale which is set to come up this January could see Seplat Energy, Sahara Group, Famfa Oil, Troilus Investments Limited, and Nigeria Delta Exploration and Production (NDEP) bidding for the asset.
  • TotalEnergies has declared a force majeure on its Northern option pipeline (NOPL) after a case of vandalisation at KP41 Alaoma Etche Cluster was reported at the line over the weekend.
  • Oil production of 50.788 million barrels valued at N1.474tn was shut down between January and October 2021 on the back of community interferences and other operational issues forcing oil terminals to stall production 222 times within the period, according to a Punch report.
  • The Nigeria Labour Congress on Tuesday called on its members, affiliate unions, and civil society partners to prepare for the planned nationwide protests on January 27 and February 1 against the planned removal of fuel subsidy by the Federal Government.
  • Oil marketers under the aegis of the Independent Petroleum Marketers Association of Nigeria on Wednesday stated that it has commenced the establishment of autogas conversion centres in filling stations across the selected states following moves by the Federal Government to begin the use of autogas in vehicles in 12 pilot states.
  • The Nigeria LNG Limited on Thursday announced that its board of directors had approved the supply of 100% of the Liquefied Petroleum Gas (both butane and propane) produced by the company to the Nigerian market.
  • The Nigerian National Petroleum Corporation Limited (NNPC) monthly report revealed that the corporation generated total revenue of N2.992 between January and November 2021, a shortfall of 34% from the N4.564 trillion  projected for the period.

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  • Oil prices edged up on Monday as supply disruptions in Kazakhstan and Libya offset worries stemming from the rapid global rise in Omicron infections.
  • Indonesia's Energy Minister, Arifin Tasrif, on Monday, noted that the country is hoping to resume its coal shipments in a few days as pressure mounts on the world's largest thermal coal exporter to end its current ban on coal export.
  • Rhodium Group reported that U.S. greenhouse gas emissions rose by 6.2% in 2021 from their level in 2020 due to the increased use of coal-fired electricity which jumped by 17% and drivers return to the roads after the 2020 restriction.
  • The U.S. Energy Information Administration in its Short-Term Energy Outlook (STEO) on Tuesday upgraded its oil demand outlook, seeing total U.S. demand rising by 840,000 b/d in 2022 from the 2021 level. The EIA also pared its production outlook for 2022, expecting U.S. oil output to rise by 640,000 b/d.
  • The global head of commodities research at Goldman Sachs, Jeffrey Currie, on Wednesday said commodities outperformed other asset classes in 2021 and are expected to further remain competitive in 2022, saying the commodities market, especially oil may be at the first innings of a decade long super-cycle.
  • The U.S. Senate on Thursday failed to pass a bill to impose sanctions on Russia's Nord Stream 2 natural gas pipeline, a bill sponsored by Republican Senator Ted Cruz and coming a day after the Democrats unveiled their legislation to impose full sanctions on top Russian government and military officials and banking institutions if the country engaged in hostilities against Ukraine.
  • Oil futures eased for a second session on Friday on expectations that Washington may soon act to cool prices that remain above $80 per barrel, while movement curbs in China to rein in a COVID-19 outbreak weighed on fuel demand.
  • Brent had a weekly growth of +3.96% (see Table 1).


Gold appreciated by +1.46% while Silver also appreciated by +3.22% W-o-W (see Table 1).



  • Cocoa prices appreciated by +5.93% W-o-W.
  • Corn prices dipped by -2.76% W-o-W while Sugar appreciated by +1.38% (see Table 1).

Table 1Weekly Change in Commodity Prices





Weekly Chg






































Source: CNBC, Proshare Research

*Data for 14th January 2022 is as of 6:00pm (Nigerian Time)



  • In the coming week, oil prices are expected to continue its price surge as supply chain challenges continue.
  • Gold prices are expected to appreciate in the coming week as inflation continues to increase.
  • Cocoa prices are expected to appreciate in the coming week as demand still outpaces supply in the global market.
  • Sugar prices are expected to appreciate as exports begins to slow down forcing a possible supply to demand gap.
  • Corn prices are expected to steady as higher yield could put pressure on prices forcing its surge to slow down

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Fixed Income and Money Market 

Currency Market

The Naira traded both ways for the major part this week, at the close of trading on Wednesday it appreciated both at the I & E FX Window and NAFEX market. At the I & E FX Window, the Naira appreciated against the US dollars by -00.06. At the Nigerian Autonomous Foreign Exchange Fixing (NAFEX) window it appreciated by -0.65%.


Average Benchmark Yields




% Change

I & E FX Window








Source: FMDQ, Proshare Research


Money Market

System liquidity remained elevated this week, however, money market rates traded in double digits.


At the close of the trading on Thursday, open repo (OPR) and overnight rates (O/N) settled at 13.5% and 14.25% respectively indicating a W-o-W rise of +200.00% and +171.43%.


Money Market Rate




% Change

OPR (%)




O/N (%)




Source: FMDQ, Proshare Research


We expect rates to hover around current levels barring any significant outflows from the Apex bank.


Treasury Bills Market

The treasury bills market was mostly quiet this week as attention was skewed to the PMA auction which held this week.


At the close of trading on Friday, the market was mixed with buying interest seen at the NT Bills while the OMO Bills saw selling interest. Average benchmark yields for T. Bills fell by -0.87%, yields on OMO bills advanced by +1.63%.


Average Benchmark Yields




% Change

T. Bills (%)




OMO Bills (%)




Source: FMDQ, Proshare Research

We expect activity next week to be weak depending on the market liquidity situation. 


The DMO sold N57.55 billion worth of notes against N77.61 billion offered at its NTB auction this week. The 91-day, 182-day & 364-day notes were allotted at 2.50%, 3.45%, and 5.50%, respectively. Compared to the previous auction, the rate on the 91-day and 182-day paper was unchanged, while the 364-day paper rose by 60bps.

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FGN Bond Market


The local bond market was mostly quiet this week with minimal volumes traded across the board.


At the close of trading on Friday, the market closed bullish. Overall average benchmark yields closed at 11.82%, with benchmark yield falling by -0.73%.



Average Benchmark Yields




% Change

Short Tenor




Mid Tenor




Long Tenor




Source: FMDQ, Proshare Research 


FGN Eurobond Market


At the start of trading this week, the market continued in its bearish tone from the effect of the Fed's hawkish tone. However, the market close on a bullish note as investors took advantage of the higher yields.


At the close of trading on Thursday, the average benchmark yield declined by 1bp to 7.07%.

Nigerian Capital Market

  • The Nigerian bourse closed the week on a positive note as market sentiment remained positive. The NGXASI closed the week on a positive note with a rise of +1.37%. The Nigerian Exchange gained N323.40bn. However, year-to-date return was positive at +4.07%, while the market capitalization settled at N23.95trillion.
  • Sectoral performance across sectors tracked was mixed, at the close of trading on Friday, NGX-IND was the highest gainer for the week with +3.56% while NGX Consumer Goods recorded the highest decline with -4.35%. NGXMERIGRW, NGXAFRHDYI, and NGX Premium closed the week with +2.95%, +2.62%, and +2.11% respectively.
  • Market breadth for the week closed negative with 14 gainers led by FIDSON and JBERGER as against 17 losers led by SUNUASSUR and CUTIX


Chart 1: Movement of NSEASI Index Points 07 Jan 2022- 14 Jan. 2022

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Source: NSE, Proshare Research


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 750.02 points and N635.1bn with a rise of +0.53% and +0.54% respectively.

Dangote and Toni Index

Dangote Index closed the week positive with 141.19 basis points from 131.25 basis points recorded the previous week, representing a rise of +7.57%.

DANGCEM  recorded a rise of +8.00% NASCON recorded a decline of -0.76% while DANGSUGAR  was at a flat rate.


Table 2: Dangote Index W-o-W Change





WoW Chg
















Source: NGX, Proshare Research 


Furthermore, the Toni Index closed positive with 114.89 basis points from 110.58 basis points recorded the previous week, a W-o-W growth of +3.90%.

UBA and UBCAP and closed the week negative with -3.13%, -2.30% while TRANSCORP and AFRIPRUD closed the week positive with +16.33% and +2.38% respectively. TRANSCOHOT and closed flat W-o-W.

Table 3: Toni Index W-o-W Change




WoW Chg





















Source: NGX, Proshare Research 

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