Daily Market Update –June 21, 2013
Money Market: Interbank Rates Flat on Maturing Bills
The interbank lending rates ended the week unchanged at an average of 11.33%, as maturing treasury bills and anticipated flows of public funds kept the market from tightening.
The central bank repaid about ₦160 billion ($990 million) on Thursday in matured open market operation debt notes, swelling liquidity.
"The cost of borrowing in the market had gone to an average of 14% for overnight in the week because of shortage of funds, but dropped on Friday after the cash flow from matured bills and expectation of budget allocation," a dealer told Reuters.
Dealers said the market opened with a cash balance of about ₦76.65 billion on Friday, compared with ₦136 billion a week earlier.
The secured Open Buy back (OBB) was unchanged at 11%, 100 basis points lower than the Central Bank's benchmark interest rate.
Both overnight placement and call money closed at 11.5% apiece, same level last week.
Traders said rates will drop to around 10.25% for overnight next week by the time cash from the May budget allocation to government agencies hits the market.
Nigeria distributes ₦620.7 billion in May revenues to its three tiers of government –federal, state and local, but bankers said half of the amount is expected to hit the money market by Monday, helping to provide liquidity support for the banking sector.
Stock Market: All-Share Index Depreciates
The NSE All-Share Index depreciated by 2.11% to close on Friday at 36,464.39 basis point while the market capitalisation of the listed equities on the main board also declined by 2.11% to close at ₦11.72 trillion. Also, the NSE 30 Index sheds 1.99% to close at 1,744.40.
A turnover of 1.63 billion shares worth of ₦21.68 billion in 30,952 deals were traded this week by investors on the floor of The Exchange in contrast to a total of 3.73 billion shares valued at ₦75.87 billion that exchanged hands last week in 39,060 deals.
Meanwhile, the former United States of America Ambassador to Nigeria, Dr. Robin Sanders, paid a courtesy visit at the Exchange today during a Bell Ringing Ceremony.
A turnover of 272.82 million units valued at ₦310.62 billion in 1,903 deals were recorded this week in contrast to 184.033 million units worth ₦206.53 billion in 1,179 deals recorded in the preceding week.