FIXED INCOME MARKET

Money Markets                                                                                 

Interbank system liquidity improved today, opening with a balance of ₦125.15 billion, higher than previous day’s opening balance of ca ₦36.52 billion, as inflows of ca ₦42.00 billion impacted the system from OMO maturities. Nonetheless, the Overnight Policy Rate (OPR) and Overnight (ON) rates trended higher to 11.00% and 11.67% from 9.00% and 9.67% respectively, the previous day.

Treasury Bills    

Despite the improved offers across the curve, activity in the NTB market remained weak due to a lack of prospective buyers. Most investors have chosen to stay on the sidelines, as the market approaches the end of the first quarter of 2022. Thus, the average rate remained unchanged across the yield curve to settle at 3.17%.

Bonds  

The FGN bonds secondary market saw the auctioned papers – 2026s and 2042s offered at 10.08% and 12.65% respectively, following yesterday’s bond auction. However, due to high market bids, trades executed were few and far between, consequently, the average yield stayed flat across the curve. We expect rates to moderate as the week progresses.

Eurobonds

Following reports that the U.S. Fed chairman, Jerome Powell, sees a 50bps rate hike as possible if needed this year, the SSA Eurobond markets traded bearish, with mild sell-offs seen across the yield curve. Overall, the average yield inched up by c.11bps settle at 8.08%.

Equities

The domestic bourse sustained its negative performance, as the Nigerian Stock Exchange All Share Index (NGX ASI) lost ca 0.20% day-on-day to close at 47,156.56pts, while market year-to-date returns extended to ca +10.39%. Sell-offs were seen in stocks like Nestle Plc (-2.79%), Guaranty Trust Holding Company Plc (-0.57%) and Zenith Bank Plc (-0.19%).

The NGX Consumer Goods, Oil and Gas, Banking and Industrial Goods indices shed ca 1.55%, 1.01%, 0.38% and 0.08% respectively, day-on-day.

Access Bank Plc topped the volume chart with ca 44.15 million units, while Zenith Bank Plc led the value chart with ca 758.01 million worth of trades.

Foreign Exchange

FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦417.00/US$1.00 from ₦416.25/US$1.00, the previous day.

Commodities

Global crude oil prices depreciated today, as U.S fed chair, Jerome Powell signaled a more aggressive tightening of monetary policy than previously expected, reporting a possible 50bps hike in interest rate this year. Thus, Brent Crude Oil price lost ca 1.18% day-on-day to settle at US$114.26pb, while WTI also lost ca 1.98% to US$109.90pb as at report time. Spot Gold lost ca 0.75% day-on-day to settle at US$1,915.20 per ounce as at report time.

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