Following FX swaps and the reversal of OMO winnings by the Apex bank, system liquidity stood at ₦186.43 billion. WoW, the Open Buy Back (OBB) rate rose 233bps to 16.58% while the Overnight (OVN) rate increased by 290bps to print at 17.80%.
We expect a moderation in rates.
Treasury Bills
The Treasury Bills market kicked off the week on a bullish note characterized by demand across the curve with only a few trades consummated on the 26-Dec-24 bill as low as 6.00% due to scarcity of offers. The PMA was also conducted in which the DMO offered and sold ₦56.56 billion across the standard maturities despite a total subscription of ₦1.14 trillion. We saw a 456bps, 578bps and 384bps decline across the standard maturities, settling at 2.44%, 4.22% and 8.39%. The CBN also declared an OMO auction with a total offering of ₦300 billion spread across the 97-day, 181-day, and 363-day tenors. The OMO auction attracted a total subscription of ₦414.20 billion, resulting in a total sale of ₦357.20 billion across the three tenors. Notably, there was an uptick in stop rates for the 97-day, 181-day, and 363-day tenors, concluding at 10.50%, 14.00%, and 17.75%, respectively. Following the result, we saw trades consummated on the newly issued OMO bill at 7.50% before bids retraced to as high as 11% levels. WoW, the average benchmark yield fell 283bps to 2.89%.
We expect a calm session with a bullish undertone.
FGN Bond Market
The FGN local bond Market traded on mixed sentiments this week with activity skewed to the 29s, 38s and 53s. We saw some trades executed on the 29s at 13.00%. On the 2053 bond, we saw trades executed at 15.85%, 15.40% and as low as 15.20% throughout the course of the week. To conclude the week, market went into quiet mode due to the illiquidity in the system. WoW, the average benchmark yield declined by 40bps to 13.75%.
We expect cautious sentiments as market waits on the bond auction calendar.
Eurobond Market
The FGN Eurobond market traded on mixed sentiments. The bearish mode stemmed from the effect of the higher-than-expected Non-Farm Payroll data (216K vs 170K), CPI data (3.40% against expectations of 3.20%) while the bullish mode was due to the PPI data (1% YoY Vs. expectations of 1.3%). Furthermore, the average benchmark yields lost 55bps week-on-week, settling at 9.82%.
We expect a bullish open to the next trading session
Currency Market
The value of the Naira to the dollar depreciated by 243bps to print at ₦890.54/$ this week at the Nigerian Autonomous Foreign Exchange Market Window.
Equities Market
Pulling the curtains on this week’s performance, the ASI marked a positive finish with a 54bps day-on-day and 424bps week-on-week advancement. Today’s favorable close was supported by gains in UBA (+0.65%), TRANSCORP (+3.36%) and GTCO (+2.89%) which was sufficient to suppress the losses in ACCESSCORP (-0.53%) and Zenith Bank (-1.15%). At closing, the year-to-date return advanced by 11.06% while market cap followed suit, growing by ₦0.24trillion to settle at ₦45.45 trillion. The market breadth reflected the positive momentum, with 75 advancers outperforming 23 decliners, resulting in a market breadth of 3.26x.
In terms of this week’s trading activity, both volume and value traded saw a decline of 32.72% and 36.51% to 600.63 million units and ₦9.10 billion, respectively. TRANSCORP stood out as the most traded stock, recording 653.26 million units, followed by FCMB with 360.64 million units and Fidelity Bank with 357.06million units. Among the top-valued equities for the week, UBA took the lead at ₦9.67 billion, trailed by Access Corporation at ₦9.32 billion, and TRANSCORP at ₦8.88 billion.
