Dear Afrinvestor,
Please
find below our Weekly Update for the week ended 4th May,
2012.
Key Highlights: -
Macroeconomic
/Socio-Political Update
·
Current
data from the Central Bank of Nigeria indicates that foreign reserves have
reached its highest point in just over a year, inching up by 2.96% on the
month, to US$36.52bn.
·
The
Minister of Finance, Dr. Ngozi Okonjo-Iweala has set a new price tariff on all
types of imported rice in the second quarter of 2012.
Equity Market
Review & Outlook
·
Equities
recorded mostly negative performances globally. European stocks posted their
biggest weekly drop since March, as Spain entered a recession while investors
awaited election results in France and Greece last weekend.
·
On a
contrarian mode, the Nigerian equity market was upbeat last week with the
market gaining 252bps, as it continued in an upward trend for the third week
running.
Money Market Review &
Outlook
·
Interbank
rates inched up last week, as the excess liquidity within the money market gradually
eased out via debits from WDAS and OMO auctions.
·
We
expect a further hike in market rates this week, on the back of scheduled
debits for WDAS and T-bill auctions.
Foreign Exchange Market
Review & Outlook
·
The CBN
offered and sold US$270.0m at the WDAS last week. The marginal bid rate at
Monday’s auction was N155.70/US$1.00 with the Naira losing 5k to the Dollar
from its previous close price.
·
We do
not anticipate significant changes in Naira trading patterns this week.
Bond Market Review & Outlook
·
Sentiments
were bullish in the bond market last week, with yields dipping on all traded
instruments. The Nigerian Eurobond gained 96cents in its price from US$109.38
in the previous week to US$110.34, as its yield subsequently dipped by 13bps
from 5.39% to 5.29%.
·
We
expect a further decline in yields albeit marginal this week, as scheduled
inflows form maturing OMO and T-bills should buffer average market liquidity
levels.
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Update.
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Kind regards,
Investment Research
27
Gerrard Road,
Ikoyi,
Lagos
T: +234-1-2701680 Ext 311
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Website: www.afrinvest.com
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