FIXED INCOME MARKET
Interbank system liquidity opened the day with a credit balance of ca ₦114.81 billion compared to yesterday’s deficit balance of ₦146.42 billion as coupon inflows hit the system. Thus, the Overnight Policy Rate (OPR) and Overnight Rate (O/N) trended lower to 14.83% and 15.33% from 16.34% and 16.51%, recorded the previous day.
Post-auction trading in the NTB secondary market was mixed to bullish, with most demand skewed to April 2023 papers, while offers on the newly issued paper printed at ca 14.00%. Overall, the average rate closed ca 5bps higher, day-on-day, to settle at 9.43%.
The FGN bonds market traded bearish earlier today in reaction to the 150bps increase in stop rate for the 1-year NTB paper, however coupon inflows fueled renewed buying interest, with most trades witnessed on 2026s, 2035s, and 2037s, respectively. Overall, the average yield closed ca 3bps higher, day-on-day, to settle at 14.47%.
The Eurobond space sustained its bullish run, with further buying witnessed across the Nigeria and Angola curves amid positive equities trading. Nonetheless, Ghana and Egypt endured a softer tone, with the latter reaching a preliminary agreement with the IMF on a $3bn loan to combat soaring inflation. Overall, the average yield across the Nigerian sovereign curve settled at 13.28%.
In other news, Egypt hiked its key interest rates by 2% and switched to a more flexible exchange rate system in a bid to combat the country’s mounting economic issues.
The domestic bourse closed the day on a bearish note, with sell activity observed on stocks like Airtel Africa Plc (-2.83%), Geregu Power Plc (-1.72%), and Guaranty Trust Holding Company Plc (-1.10%), respectively. The Nigerian Stock Exchange All Share Index (NGX ASI) lost ca 0.52% day-on-day to close at 44,625.18pts, while market year-to-date returns dropped to ca +4.47%.
The NGX Banking and Consumer Goods Indices gained ca 1.11% and 0.01% day-on-day, respectively. The NGX Industrial and Oil & Gas Indices closed flat.
Mutual Benefits Assurance Plc led the volume chart with ca 47.85 million units, while Airtel Africa Plc topped the value charts with ca ₦573.53 billion worth of trades.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦444.50/US$1.00 from ₦441.67/US$1.00, recorded the previous day.
Global oil prices rose further amid optimism over record US crude exports and signs that recession fears are fading. Brent Crude Oil price gained ca 1.10% day-on-day to settle at US$96.74pb, while WTI rose ca 1.43% day-on-day to settle at US$89.18pb as at report time. Spot Gold dipped ca 0.48% day-on-day to close at US$1,661.20 per ounce as of report time.