Money Market
The interbank rate exhibited consistent stability over the week, owing to the relatively steady liquidity in the financial system. When compared on a week-to-week basis, there was a slight uptick of 50 basis points in the Open Buy Back (OBB) rate, and a 53 basis points increase in the Overnight rate (O/N), concluding the week at 1.50% and 2.20% respectively.
We expect the rate to remain around similar levels next week.
Treasury Bills
The Treasury bills market experienced a bearish trend this week despite relatively robust financial system liquidity. However, there was a mild demand observed in some long-term papers. As a result, the average benchmark yield rose by 15 basis points to reach 6.02%.
We expect a calm session at the start of the week ahead of the mid-week NTB auction.
FGN Bond Market
This week, the FGN bond market displayed bullish sentiment. There was notable interest in purchasing shorter-term maturities, whereas some selling interest was seen on the April 20237 maturity. The long end of the curve experienced relatively subdued activity throughout the week. Consequently, the average benchmark yield dipped slightly by 4 bps to 14.64%.
We expect to see some buying interest next week, albeit on a less aggressive note.
Eurobond Market
Throughout the week, the FGN Eurobonds market experienced a predominantly bearish trend, characterized by widespread selling activities. As a result, the average benchmark yield increased by 79 basis points, ultimately settling at 12.66%.
We expect the market to be swayed by the U.S. ISM manufacturing PMI next week.
Currency Market
The value of the naira to the dollar depreciated by 568 bps to print at ₦808.27/$ this week at the Nigerian Autonomous Foreign Exchange Market (NAFEM).
Equities Market
During the final trading session of the week, the local stock exchange experienced another day of decline, with the NGX All-Share Index (NGXASI) dropping by 27 basis points compared to the previous day and a 42 basis point decrease compared to the previous week, ultimately settling at 66,382.14 points. This negative performance was primarily attributed to consistent selloffs observed in GEREGU (-7.22%), DANGSUGAR (-2.31%), and FLOURMILLS (-9.03%). Consequently, the market breadth concluded on a negative note at 0.68, indicating 19 decliners for every 13 advancers. Trade volumes also decreased by 31.07% to 205.89 million units, while trade value saw an expansion of 42.32% to N6.38 billion. FIDELITYBK led the volume chart, trading 28.13 million units (constituting 13.66% of the market volume), while GEREGU topped the value chart with deals worth N3.20 billion (accounting for 50.10% of the total value traded). The year-to-date (YTD) return for the All-Share Index declined to 30.56%, and the market capitalization dropped by N156.34 billion week-on-week (WoW), settling at N36.76 trillion.
Throughout the week, losses in STANBIC (-13.06%), GEREGU (-7.22%), MTNN (-0.20%), NESTLE (-0.49%), and NB (-9.52%) highlighted the market’s overall weak performance, overshadowing gains seen on banking stickers UBA (+8.26%), ZENITHBANK (+3.28%), and GTCO (+2.31%).
