FIXED INCOME MARKET
Interbank system liquidity improved significantly with a positive opening balance of c.₦325.63 billion compared to c.₦ 174.68 billion recorded yesterday. Thus, the Overnight Policy Rate (OPR) and Overnight (ON) rate declined to 10.00% and 10.28% respectively from 10.63% and 10.88% recorded the previous day, amid less funding pressure.
It was a lull treasury bills trading session today, as market participants anticipated the outcome of the NTB auction. However, passive demand was recorded across Jan 2023 to Mar 2023 papers, but the offers were relatively scarce. Thus, the average mid-rate closed lower by c.5bps at 7.48%.
The FGN bonds market also endured a quiet theme, with sideways interest recorded across the 2026, 2029, 2032 and 2037 papers, albeit traded volumes were few and far between. Overall, the average mid-yield closed c.2bps lower, to settle at 14.45%.
Following the stock markets’ sustained selling interest amidst mixed signals from China and global economic concerns, the Eurobond market witnessed another weak session, with average price reduction of c.1.25pts observed across the major SSAs and MENAs. Overall, the average yield across the Nigerian sovereign curve settled at 11.58%.
In other news, Ghana’s local debt score was cut to ‘selective default’ by S&P amidst debt exchange plan, outlook negative and Kenya seeks $750m funding from World Bank as part of planned external borrowing.
The domestic bourse closed on a positive note, as the Nigerian Stock Exchange All Share Index (NGX ASI) gained c.0.12% day-on-day to close at 48,426.49pts, while year-to-date returns improved to +13.37%. Buying interest on bellwethers like NB (+4.62%) and NESTLE (+1.67%) drove the index upward.
The NGX Consumer Goods Index gained c.0.90bps, the NGX Banking and Oil & Gas indices lost c.0.17% and c.0.08% day-on-day respectively, while the NGX Industrial Index remained unchanged from the previous day. First Bank of Nigeria Holdings Plc continued to lead the volume chart c.59.27 million units while GEREGU also continued to lead the value charts with c.₦1.53 billion worth of trades.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦445.83/US$1.00 from ₦445.80/US$1.00 recorded the previous day.
Oil briefly weakened on Wednesday, with Brent crude falling close to its lowest this year, pressured by concern about recession and easing fears that a Western cap on Russian oil prices would significantly curb supply. Overall, Brent Crude Oil price gained c.0.58% day-on-day to settle at US$79.89pb, while WTI lost c.2.26% day-on-day to settle at US$75.14pb as at report time. Spot Gold gained c.0.41% day-on-day to close at US$1,788.40 per ounce as of report time.