FIXED INCOME MARKET
Interbank system liquidity improved to c.
₦392.48 billion versus c.₦368.47 billion reported the previous day. However, the Overnight Policy Rate (OPR) and Overnight Rate(O/N) increased to 12.00% and 12.50% respectively from 7.00% and 7.50% reported at yesterday’s session, due to the Retail SMIS auction.
The treasury bills market closed the week on a tepid note, albeit with mixed interest recorded on the long-dated papers, ahead of the NTB Primary Market Auction scheduled to hold next week. Overall, average rate closed relatively flat at 7.55%.
The FGN bonds market traded on a quiet note as well, although mild buying interest was recorded on 2042s and 2050s at 14.10% and 13.55% levels respectively, with weak offers to match. Thus, average yield remained unchanged at 12.84% due to the low traded volumes.
The Eurobond space traded bullish on the back of encouraging Non-farm payroll data, with several lifts recorded across the major curves we track (Nigeria, Ghana and Angola), causing prices to appreciate by c.1.80pts on average. In other news, the US economy added 315,000 jobs in the month of August, above market estimate, however, the unemployment rate rose to 3.7% from 3.5% recorded in July.
The domestic bourse continued to trade with bullish sentiment as the Nigerian Stock Exchange All Share Index (NGX ASI) gained 0.31% day-on-day, closing at 50,045.83pts while year-to-date returns improved to +17.61%. Buying sentiment on stocks such as NB (+3.30%), ACCESSCORP (+2.35) and MTNN (+0.50%) drove the performance.
The NGX Consumer Goods, & Banking Indices both gained by c.0.38% and 0.90% respectively, the NGX Oil & Gas Index lost c. 0.05% while the NGX Industrial Index closed flat. Sterling Bank led the volume chart with c.93.73million units while MTNN topped the value charts with c.₦ 1.21 billion worth of trades
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦431.50/US$1.00 from ₦430.00/US$1.00 recorded on at the previous day.
Oil prices climbed today on the expectation that OPEC+ will discuss output cuts at a meeting on Sept. 5, but the benchmarks were still on track to post their worst weekly drop on fears that Covid-19 restrictions in China and weak global growth will hit demand. Brent Crude Oil gained c.1.92% day-on-day to settle at US$94.17pb, as the WTI also gained c2.00% day-on-day to settle at US$88.33pb as at report time. Spot Gold rose by c.1.09% day-on-day to close at US$1,728.40 per ounce as of report time.