System Liquidity
System liquidity swung sharply into a wider surplus as a large OMO maturity inflow more than offset prior tightness, even as DMBs stayed active at the SDF window. Funding costs held steady as a result but are expected to face renewed upward pressure next session once the FGN Bond auction proceeds settle and pull liquidity back down.
Treasury Bills
The NTB market traded calm-to-bullish, with demand concentrated on select short-dated bills, pushing discount rates lower on those maturities. With no NTB auction scheduled this week, demand should stay anchored on the same bill.
FGN Bonds
Secondary market activity picked up notably following the week’s auction, as successful bidders took profit while investors with unmet demand rotated into the reopened maturities. Buying was concentrated at the belly of the curve, pulling yields lower there. Trading should stay concentrated in the same tenors as investors continue positioning around post-auction levels.
Eurobonds
The Nigerian Eurobond curve turned bearish, tracking a broader global bond sell-off as renewed geopolitical tensions lifted oil prices and revived inflation concerns, pushing U.S. Treasury yields higher and dulling the relative appeal of EM/frontier debt. Selective buying could resume, but profit-taking may cap the pace of any rally.
Nigerian Equities
The market closed bearish, led lower by Banking and Consumer Goods, with Oil & Gas also softer and Industrial Goods flat; Insurance was the lone gainer. Despite the pullback, broader sentiment remains resilient given the strong year-to-date performance. Expect continued cautious, choppy trading as profit-taking follows the rally, with selective support from names offering strong earnings and dividend visibility.
Foreign Exchange
The naira weakened marginally at the official window even as reserves ticked higher. Stability should hold near-term on improving FX liquidity, though persistent demand and the official-parallel market gap could limit further gains.
Commodities
Gold held firm as softer U.S. economic data pushed back expectations for further Fed tightening, with rates now seen on hold at the next meeting; safe-haven flows added further support. Oil prices rose after the U.S. signaled no interest in extending a regional truce that has now expired, reviving supply-disruption concerns. Gold should stay supported by safe-haven positioning, while oil remains volatile on escalating geopolitical risk.
