FIXED INCOME MARKET
Interbank system liquidity opened lower with a credit balance of ca ₦306.46 billion due to the NTB auction settlement, compared to yesterday’s opening balance of ca ₦458.32 billion. Nonetheless, the Overnight Policy Rate (OPR) and Overnight Rate (O/N) held steady at 8.50% and 8.83%, respectively.
The NTB secondary market sustained its bullish theme following the fall in stop rate for the 1-year paper at yesterday’s auction. The newly issued 1-year paper dipped c.25bps as unmet demand at the auction crowded available market offers. Overall, the average rate dipped ca 15bps, day-on-day, to settle at 8.61%.
The FGN bonds market was muted albeit with a bullish undertone. Few demands were seen on 2026s, 2042s, and 2049s but wide bid/ask spreads ensured low traded volumes. Consequently, the average yield closed relatively flat, day-on-day, to settle at 14.67%.
The Eurobond market endured weak sentiments in anticipation of the US CPI data, thus risk assets were repriced lower across the African curves on average c.1.05pts. Overall, the average yield across the Nigerian sovereign curve settled at 11.51%.
In other news, The US consumer inflation for October slowed to 7.7% (vs 8.20% in September) over the past 12 months, easing some pressure on households and economy. Thus, it is unlikely the Fed hikes by 75bps in its last FOMC meeting for the year, however there’s more time to better assess the economic situation given that there’s one final CPI reading ahead of that meeting.
The domestic bourse sustained positive sentiments as the Nigerian Stock Exchange All Share Index (NGX ASI) gained 1.07% day-on-day to close at 43,942.82pts, while year-to-date returns extended to +2.87%. This performance was due to a keen interest in bellwethers such as Dangote Cement Plc (+7.77%), Access Holdings Plc (+0.63%), Airtel Africa Plc (+0.37%), and Guaranty Trust Holding Company Plc (+0.28%), respectively.
The NGX Industrial, Oil & Gas, and Banking Indices gained 3.51%, 0.12%, and 0.01% while the NGX Consumer Goods Index lost ca 0.66%, day-on-day, respectively.
Sterling Bank Plc led the volume traded chart with ca 171.15 million units while Airtel Africa Plc led the value traded chart with ca ₦700.25 million worth of trades.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to settle at ₦446.10/US$1.00 from ₦445.67/US$1.00, recorded the previous day.
Global oil prices observed ease on its bearish course as U.S. inflation figures balanced fuel demand concerns amid renewed Covid curbs in China. Brent Crude Oil price rose ca 0.73% day-on-day to settle at US$93.33pb, while WTI gained ca 0.35% day-on-day to settle at US$86.07pb as at report time. Spot Gold gained ca 2.41% day-on-day to close at US$1,755.00 per ounce as of report time.