FIXED INCOME MARKETS
Opening system liquidity declined to c.₦400.5 billion compared to yesterday’s opening balance of c.₦ 459.3 billion. Consequently, the Overnight Policy Rate (OPR) and Overnight Rate (O/N) increased to 10.75% and 11.13% respectively from 10.50% and 10.81% recorded the previous day.
The bargain hunting across the long end treasury bills curves persisted in today’s session, especially on the newly issued 1-year Bill. The mild rally was sustained, due to scarcity of supply in the secondary market, with offers falling to 1.40% levels. To qualify, the average mid-rate shed 10bps to settle at 2.33%.
In the absence of any positive catalyst, the bond market remained bearish across the mid-to-long end of the curve, although on a less aggressive note. Most offers were seen on the 2028, 2037 and 2049 papers, as market players take position ahead of Monday’s FGN bond auction. Overall, the average mid yield settled at 13.40% to close the week.
The risk-off sentiments in the Eurobonds market drove the market to close on a bearish note, on the back of market players fully digesting the hawkish commentary by some members of the board of governors at the Federal Reserve. Thus, the average mid-yield in the Nigerian curve settled at 11.86%.
Meanwhile, Egypt’s inflation climbed to 25.8% in January from 21.3% in December, marking the highest inflation in 5 years.
The Nigerian domestic bourse closed on a negative note, as the Nigerian Stock Exchange All Share Index (NGX ASI) decreased by c.0.06% day-on-day to close at 54,327.30points while year-to-date return closed at c.6.00%. Selling activities on trendsetters like FIDELITYBK (-2.11%) MTNN (-0.82%) and NB (-0.49%) drove the bearish theme.
The NGX Banking and Oil & Gas Indices both appreciated in value by c. 0.01% and c.0.72% respectively, while the NGX Industrial Goods and Consumer Goods Indices both depreciated in value by c. 0.01% and c. 0.19% respectively. AIRTELAFRI led the values charts with c. 1.29 billion units while FBNH led the volumes charts with c. ₦30.22 million worth of trades.
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate depreciated to ₦461.50/US$1.00 from ₦ 461.10/US$1.00 recorded at the close of the previous day.
Oil prices fell in early trades today but were headed for a weekly gain, with the market continuing to seesaw between fears of a recession hitting the United States and hopes for strong fuel demand recovery in China, the world’s top oil importer. Brent Crude Oil price gained c.2.21% day-on-day to settle at US$86.37pb, while WTI gained c.2.22% day-on-day to settle at US$79.79pb as at the time of this report. Spot Gold grew by c.0.07% day-on-day to close at US$1,879.80 per ounce as of report time.