FIXED INCOME MARKETS
Money Market
Opening system liquidity increased by 87.36% from ₦117.32 billion last week to ₦219.82 billion today. Thus, the Open Repo Rate declined by 12bps to 15.38%, and the Overnight Rate lost 90bps to 16.10%.
Outlook: We expect rates to stay elevated tomorrow.
Treasury Bills
The Treasury bills market was quietly stirred in today’s session, with mixed sentiment on selected papers. Although, the backdrop displayed a substantial bullish bias. As a result, average mid-yield declined by 131bps to close at 13.07%.
Outlook: We expect the market to trade sideways tomorrow.
FGN Bonds
Similarly, the local bonds market traded sideways, with activities revolving around the 2029, 2033 and 2038 papers. At the closing bell, average mid-yield fell by c.14bps to settle at 16.46%.
Outlook: We expect a similar occurrence in tomorrow’s session.
Eurobonds
The Eurobonds market witnessed a generally subdued pace of activity, marked by a blend of positive and negative movements across Sub-Saharan African papers. Angola saw bullish trading, while Nigeria and Ghana experienced a bearish trend. Kenya also traded slightly bullish, despite the ongoing book building of a 6-year Eurobond with initial price talks (IPTs) at 11.00% and a subsequent yield set at 10.375%, with an expected size of $1 billion to $1.5 billion. Overall, Nigeria’s average mid-yield marginally declined by 1bp, closing at 9.64%.
Outlook: We expect the U.S CPI data to impact the direction of the market tomorrow.
Equities
The Nigerian equity market exhibited a bullish bias today, as ASI gained 0.18% to settle at 102, 042.32 points while the year-to-date return ticked up to c.36.47% and total market capitalization was valued at ₦55.84 trillion. To buttress, GEREGU (+6.75%) and NB (+2.63%) drove the market to close bullish.
Overall, trading activity was negative, with a 24.68% decline in total volume and a 30.31% fall in total value. UNIVINSURE led the volume chart with 42.77 million units while ZENITHBANK led the value charts with ₦1.12 billion. The Banking, and Industrial Indices declined by 0.88% and 0.07%, respectively, while the Consumer Goods and Oil & Gas Indices shed 0.60% and 0.15%, respectively.
Outlook: We expect a similar momentum tomorrow.
Foreign Exchange
FMDQ’s Nigeria’s Autonomous Foreign Exchange (NAFEM) depreciated by 4.38% (or ₦64.42) to $/₦1,534.39 from $/₦1,469.97 recorded last Friday.
Outlook: We expect the volatility to persist.
Commodities
Oil prices were largely flat today after the significant rally last week on escalating Middle East tensions. Brent crude reached $81.85 per barrel, while West Texas Intermediate (WTI) stood at $76.74 per barrel at the time of reporting. Additionally, the price of gold surged to $2,027.00 per ounce at the same time.
Outlook: We expect geopolitical tensions to continue to weigh on crude oil prices.
