FIXED INCOME MARKETS
Money Markets
Opening system liquidity recorded an improved balance of c.₦829.97 billion long, compared to yesterday’s opening balance of c.₦717.60 billion. However, the Overnight Policy Rate (OPR) remained unchanged at 10.50%, while the Overnight Rate (O/N) increased by 2bps to 10.83%.
Outlook: We expect the interbank rates to hover at similar levels, barring any major flows.
Treasury Bills
The treasury bills market closed on a bullish territory as market players demanded the mid-to-long bills. Given the improved system liquidity, the 22 Feb rallied to around 5.70% levels in offers, while we also saw sizeable buy interests for the May 2023 papers. Average yield declined further by c.28bps.
Outlook: We anticipate a similar performance in tomorrow’s session, with reduced offers on May 2023 and Feb 2024 papers.
FGN Bonds
The local bonds market was also bullish, as buy interests was majorly seen between the mid-to-long end of the curve, particularly on the 2028, 2037 and 2049 papers. Consequently, average mid-yield shed 6bps to settle at 13.61%.
Outlook: We expect the bullish bias to spill into tomorrow’s session.
Eurobonds
The bearish sentiment resurfaced in the Eurobonds market today, as sell offs rattled across board in SSA curves parring back the gains from yesterday. Thus, the average yield nudged upwards by 30bps to 11.75%.
Outlook: We expect market activity to be susceptible to the upcoming U.S economic data release.
Equities
The Nigerian equity market closed on a positive note, as the Nigerian Stock Exchange All Share Index (NGX ASI) appreciated in value by c.0.86% day-on-day to close at 55,806.26 points while year-to-date return closed at c.8.89%. Buying activities on pacesetters like OANDO(+9.09%), WAPCO (+5.38%) and DANGCEM (+2.21%) drove the bullish theme. The NGX Banking, Industrial Goods and Oil &Gas Indices all appreciated in value by c. 1.68%, c. 1.40%, and c. 0.41% respectively, while the NGX Consumer Goods declined by -0.09%. FIDELITYBK led the volume charts with c. 39.97 million units, while DANGCEM led the value charts with c. ₦ 1,575.83 million worth of trades.
Outlook: We expect the positive performance to persist in tomorrow’s trading session.
Foreign Exchange
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate remained unaltered at ₦ 462.00/US$1.00 from ₦ 462.00/US$1.00 recorded at the close of yesterday.
Outlook: We envisage sustained FX pressures, CBN intervention and depreciation of the Naira.
Commodities
Oil prices rose Tuesday, supported by hopes a solid economic rebound in China will drive up fuel demand, offsetting worries about further U.S. interest rate hikes dragging on consumption in the world’s biggest economy. Brent Crude Oil price increased by c.1.80% day-on-day to settle at US$83.93pb, while WTI also increased by c.1.73% day-on-day to settle at US$76.99pb as at the time of this report. Spot Gold appreciated in value by c.0.48% day-on-day to close at US$1,883.90per ounce as of report time.
Outlook: We anticipate more volatilities in Oil prices amid stronger dollar performance and supposed deepening of Russia’s oil supply cuts.
