FIXED INCOME MARKET
Interbank system liquidity opened higher today with a balance of ca ₦151.13 billion, compared to yesterday’s opening balance of ca ₦91.44 billion. Thus, the Overnight Policy Rate (OPR) and Overnight (ON) rate closed lower at 14.38% and 15.25% respectively from 15.75% and 16.25%, recorded the previous day.
Activity in the NTB market was bullish with rates dropping across the curve, especially on the mid to long dated papers. The latest 1-year paper (07-Dec-2023) traded around 10.20% ahead of tomorrow’s NTB auction, while offers hovered at sub 10.00% levels.
The FGN bonds market traded bullish following yesterday’s bond auction results, with offers dropping significantly across the auctioned papers (2029s, 2032s and 2037s), as investors scrambled to fill lost auction bids. The surrounding tenors also declined in tandem as investors sought alternatives. Thus, the average mid yield closed ca 31bps, day-on-day to settle at 13.87%.
The Eurobond space was mixed to bullish, especially across the Ghana curve following a staff level agreement reached with the IMF and the commencement of talks with bilateral lenders and foreign investors. Also, the lower than expected US CPI reading (7.10% vs 7.30%) spurred further buyside activity across the other SSAs and MENAs. All eyes will be on the Fed’s interest rate decision tomorrow. Overall, the average yield across the Nigerian sovereign curve closed at 10.91%.
The domestic bourse reflected a bearish performance as the Nigerian Stock Exchange All Share Index (NGX ASI) lost 0.09% day-on-day to close at 48,853.54pts, while year-to-date returns further reduced to +14.37%. This can be attributed to the profit taking on stocks like MTN Nigeria Communications Plc (-3.26%) and Stanbic IBTC Plc (-1.83%), respectively.
The NGX Industrial and Banking indices gained ca 1.78% and 0.64% day-on-day, respectively. The NGX Oil & Gas and Consumer Goods Indices closed flat.
Sterling Bank Plc led the volume chart with ca 31.61 million units, while MTN Nigeria Communications Plc topped the value charts with ca ₦2.60 billion worth of trades.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to settle at ₦446.38/US$1.00 from ₦446.00/US$1.00, recorded the previous day.
Global oil prices rose due to supply disruptions and the easing of Covid restrictions in China. Brent Crude Oil price gained ca 2.26% day-on-day to settle at US$79.72pb, while WTI rose ca 1.91% day-on-day to settle at US$74.57pb as at report time. Spot Gold gained ca 2.25% day-on-day to close at US$1,832.40 per ounce as of report time.