FIXED INCOME MARKET
Interbank system liquidity opened the week lower, with a credit balance of ₦178.50 billion compared to Friday’s opening balance of c. ₦347.91 billion. Thus, Overnight Policy Rate (OPR) and Overnight (ON) rate settled at 6.33% and 7.08% respectively from 6.67% and 7.00% recorded last week Friday.
The Treasury Bills secondary market opened with mixed sentiments seen across tenors. There were notable offers on Sept to Nov 2022 Bills, while mild demand was seen on 25 May 2023 bill, as market participants continued to take positions ahead of the NTB Auction scheduled for Wednesday, 08 June 2022. Overall, average rate remained unchanged at 3.88%.
The FGN Bonds secondary market reflected sideways trading, with bids seen majorly on 2025s and 2026s at 10.10% and 10.40% levels respectively, while slightly improved offers were witnessed on 2032s, 2035s and 2035s. Thus, average yield reduced marginally by c.3bps to 11.53% at the close of the trading session.
The Eurobond market opened relatively unchanged after the 2-day holiday in the UK as weak demand was observed on some selected SSA papers, despite Beijing slowly removing COVID-19 restrictions. In other news, The Federal Government of Nigeria scrapped the proposed US$950m Eurobond issuance, owing to unfavourable market conditions during the time frame approved for the fundraising. Overall, average rate closed flat at 11.39%.
The equities market started the week on a positive note, as the ASI Index gained c.0.34% from the previous session to close at 53,086.86pts while year-to-date returns extended to 24.28%. This was largely supported by buy side activities on bellwethers such as FBN Holdings (+2.27%) and Conoil (+9.97%).
The NGX Consumer Goods and Banking indices lost c.0.12% and 0.42% respectively while the NGX Industrial goods and Oil & Gas indices gained c.0.05% and 0.68% respectively from the previous session . FBN Holdings led both the volume charts and the value charts with c.610.41 million units and ₦ 6.78 billion worth of trades respectively.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦420.25/US $1.00 from ₦419.75/US$1.00, recorded at the previous session
Oil prices opened higher at the start of the week, after Saudi Arabia raised crude prices for July and amid doubts that an increased OPEC+ monthly output target will help ease tight supply. Hence, Brent Crude Oil price gained c.0.20% to settle at US$119.96pb, as the WTI also rose c.0.17% from the previous session to settle at US$119.04pb as at report time. Spot Gold gained c.0.33% to close at US$1,856.40 per ounce as at report time.