FIXED INCOME MARKETS
Money Markets
Opening system liquidity increased to a balance of c.₦588.39 billion, compared to yesterday’s opening balance of c.₦262.90 billion. However, the Overnight Policy Rate (OPR) and Overnight Rate (O/N) remained the same at 10.63% and 11.01%, respectively.
Outlook: We expect the interbank rates to remain relatively unchanged.
Treasury Bills
The treasury bills market traded on a calm note earlier today, as market players tilted their focus to the NTB auction. However, following the release of the NTB auction result, where the 1-year paper printed 51bps lower (9.49%) compared to the last auction (10.00%), bids adjusted to 8.00% while offers were between 7.50% and 7.70%. Consequently, average yield remained unchanged at 5.72%.
Outlook: We anticipate the market to trade mixed to bullish tomorrow, as unmet bids should filter into the secondary market while others take profit on their winnings.
FGN Bonds
The local bonds market traded on a quiet note today, as interest was mildly noticed on the 2025, 2037 and 2049 papers. Thus, the average mid-yield remained unaltered at 13.71%.
Outlook: We expect the market to extend its cautious activity tomorrow.
Eurobonds
The bearish theme persisted in today’s session amid market players’ anticipation of a rate hike by the US Fed at next week’s FOMC meeting and news of Credit Suisse’s shares plummeting by more than 30% after Saudi backer ruled out further assistance. To buttress, sell interests were seen across papers in the SSA region. Overall, the average yield expanded by 30bps to 12.94%.
Outlook: We expect sustained bearish sentiment in the interim amid next week’s FOMC meeting and selloffs across most US Banks’ stocks.
Equities
The Nigerian bourse closed on a bearish note today, as the Nigerian Stock Exchange All Share Index (NGX ASI) declined by c. 0.42% to close at 55,490.20 points while year-to-date return closed at c.8.27%. Selling interest in GTCO (-0.79%), FLOURMILL (-5.92%) and ZENITHBANK (-4.60) drove the bearish theme that was recorded today. The NGX Industrial Goods, Banking and Consumer Index, depreciated in value by c. -1.95%, c. 0.29% and c. -0.01%, respectively, while the NGX Oil and Gas Index closed flat. GTCO led both the volume charts c. 33.85 as well as the values chart at c. ₦ 841.95 billion, respectively.
Outlook: We expect the selloffs to extend into tomorrow’s trading session.
Foreign Exchange
FMDQ’s Nigerian Autonomous Foreign Exchange Fixing (NAFEX) rate appreciated to ₦ 461.09/US$1.00 from ₦ 461.42/US$1.00 recorded at the close of yesterday.
Outlook: We expect the Naira to continue to hover at $/₦ 461 handles at the NAFEX window.
Commodities
Oil extended its losses today with Brent crude hitting a three-month low as unease over Credit Suisse spooked world markets, offsetting hopes of a Chinese oil demand recovery. Brent Crude Oil price decreased by c.3.76% day-on-day to settle at US$74.56pb, while WTI decreased by c.-4.85% day-on-day to settle at US$57.87pb as at print time. Spot Gold depreciated in value by c.-0.94% day-on-day to close at US$1,928.80per ounce as of report time.
Outlook: We expect further decline in Oil prices in the interim.
