FCSL WEEKLY MARKET REPORT- 18TH SEPTEMBER, 2020

Global Economy –Rundown:
According to the organization of Economic Corporation and development have revised its economic outlook for the rest of the year, its global economic projection stands at 4.5% contraction, which is an improvement from the previous projection of global economic contraction of 6%, despite the improved projection, the global economy is still embodied by the risk element of the pandemic, as countries still contend with the resurgence in infection rate, whose ripple effects are still felt within the aviation and tourism Industries. The global economic projection for 2021 is estimated at 5% growth. Given the state of resurging infection rate that might propel some government to reintroduce restriction measures, which may hamper economic activities.
Domestic Economy –Rundown:
Nigeria’s inflation rate accelerates by 40bps to 13.22% year-on-year in August 2020 against 12.82% in July 2020. Increases were recorded across the board of the index divisions. The food index advanced by 52bps to 16% in August 2020 as against 15.48% in the previous month. Increases in the prices of Bread and cereals, potatoes, yam and other tubers, meat fish, fruits, oils and fats and vegetables led to the rise in the food index. While m-o-m, the food index increased to 1.67, higher by 15bps from 1.52% recorded in July 2020. Core inflation rose higher by 42bps to 10.52% in August as against 10.10% in July 2020, while m-o-m, the index increased by 1.05%. Expansion in core inflation was recorded in prices of passenger transport by air, hospital services, medical, pharmaceutical products, maintenance and repair of personal transport equipment, vehicle spare parts, motor cars, passenger transport by road, miscellaneous services relating to the dwelling, repair of furniture and paramedical services.
Currency:
The Naira closed flat, as the exchange rate at the I&E FX window settled at N386.00/USD, while at the parallel market, Naira dipped to N465/USD.
Equities
The equities market maintained its bearish run for the second consecutive week, as the week-on-week performance indicated a 0.08% contraction, while the YTD ASI growth was a negative growth of 4.73%. The sector performance of the NSE indices was also bearish for the week, as the average change of the NSE Indices was 0.21%, based on the indices monitored.
Fixed Income:
The system liquidity at the end of the week trended low to N219.0BN, and the open buy back rate, and overnight rates for the week inched up to 2.00% and 3.00% respectively.
T-Bills secondary market activities were bullish as average yield dipped by 29bps to 1.07% for the week, most yield declined occurred at the short end of the yield curve.
The Bond secondary market, activities were mainly bullish, as the average yield for the week dipped by12bps to 7.78%, as most yield decline was recorded across the maturity structure.
 
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