FIXED INCOME MARKETS
Money Markets
System liquidity declined to c.₦812.90 billion compared to c.₦1.22 trillion recorded the previous day. Nevertheless, the Overnight Policy Rate (OPR) remained unchanged at 10.50% while the Overnight Rate (O/N) declined to 10.75% from 10.88% recorded yesterday.
Treasury Bills
There was a heightened demand for treasury bills at today’s session, with most investors preferring same day settlement amid a possible CRR debit tomorrow. Short-dated papers were offered at 0.40%, bids on 25 Jan 2024 paper were seen at c.2.20% levels while offers were c.30bps lower. Overall, the average mid-rate closed declined by c.10bps to 3.48%.
Bonds
The FGN bonds market traded mixed to bullish sentiments, as demand for specific papers (2026s, 2028s, 2037s and 2049s) were witnessed earlier in the day by major banks who were keen to invest their idle cash same day. However, by midday, the tide turned slightly bearish with better offers observed across 2028s and 2037s. Thus, the average mid-yield closed c.10bps lower at 13.89%.
Eurobonds
With the expected 25bps hike happening at the first FOMC meeting this year and Fed Chair Jerome Powell’s comments about policy makers making progress in the battle against inflation, raising hopes the central bank is nearing the end of its rate-hike cycle, the Eurobond market observed a bullish theme. Nigeria, Angola and Egypt papers all traded higher prices, with the latter leading the pack with c.2pts price increase. Overall, the average yield on the Nigerian curve settled at 10.05%.
In other news, the Bank of England (BoE) and European Central Bank (ECB) both raised their benchmark rates by 50bps to 4.00% and 2.50% respectively. Also, the US Weekly Jobless Claims fell by 3,000 to 183,000 (Est. 195,000).
Equities
The domestic bourse sustained positive sentiments, as the Nigerian Stock Exchange All Share Index (NGX ASI) rose by c.0.93% day-on-day to close at 53,998.12 points while market year-to-date return extended to c.5.36%. Buying interests on stocks like MTNN (+3.78%) TRANSCORP (+1.63%) and SEPLAT (+9.50%) drove the index upwards.
The NGX Banking and Industrial Indices both declined by c. 0.44% and 0.001% respectively, while the NGX Oil & Gas and Consumer Goods Indices gained c. 5.17% and 0.001% respectively. UNIVINSURE led the volume chart with c.2.72 million while AIRTELAFRI topped the values charts and c.₦ 3.49 billion worth of trades
Foreign Exchange
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated slightly to N 462.00/US$1.00 from ₦ 461.50/US$1.00 recorded the previous day.
Commodities
Oil prices were steady today after tumbling in the previous session, as a weaker dollar boosted sentiment though looming sanctions on Russian oil products added uncertainty over supply. Overall, Brent Crude Oil price lost c.1.20% day-on-day to settle at US$81.89.pb, while WTI lost c.1.11% day-on-day to settle at US$75.61b as at the time of this report. Spot Gold climbed c.0.14% day-on-day to close at US$1,945.60 per ounce as of report time.
