Daily Financial Markets Update

Commentary

System liquidity declined by 26% to close the week with a surplus of ₦5.41 trillion following the net OMO issuance within the week. The Overnight (O/N) rate declined by 5bps to close the week at 22.31%, while Open Buy-Back (OBB) rate was unchanged, holding steady at 22.00%.

Commentary

The T-bills market ended the week on a bullish note, with the average benchmark rate declining by 7bps W-o-W to 16.12%. Sentiment was supported by the outcome of today's OMO auction, where the CBN allotted ₦1.37trn on the 138-day bill at a stop rate of 19.91%, leaving the 75-day tenor with no sale.

Commentary

The FGN bond market closed the week on a mildly bearish note, with selling pressure concentrated at the mid-curve. The 15-May-2033 bond led the selloff, rising by 34bps to 16.60%, followed by the 21-Feb-2034 and 29-Jan-2035 bonds, which rose by 21bps and 12bps respectively. The short end saw marginal gains, while the long end was largely unchanged. The average benchmark yield rose by 1bp, closing at 15.79%.

Commentary

The SSA Eurobond market ended the latest session on a softer footing, as investors remained cautious amid heightened geopolitical risk. This came despite stronger-than-expected U.S. jobless claims, which printed at 202k versus the prior 211k and consensus of 212k. Yields across key sovereigns reflected the risk-off sentiment: Nigeria widened by 7bps to 7.49%. Angola followed with a 10bps increase to 9.34%. Egypt saw the sharpest repricing, climbing 22bps to 8.53%.

Commentary

The local bourse closed the week positive, with the NGX ASI up 0.39% to 200,913.1 points, while YTD return moderated to 29.62%, on a week-on-week basis due to the public holiday. Sectoral performance closed on a negative note week-on-week, reflecting mixed but largely bearish sentiment across key indices. The Banking sector recorded a modest gain of 0.47%, supported by buying interest in GTCO, which advanced by 5.08%. On the downside, the Insurance sector declined sharply by 3.95%, pressured by sell-offs in Conhall Plc, which fell by 13.04%. The Industrial Goods sector edged lower by 0.24%, weighed down by losses in Cutix, which declined by 4.86%. Similarly, the Consumer Goods sector dropped by 2.61%, dragged by a notable 10.00% loss in one of its major constituents, Nestlé. Conversely, the Oil and Gas sector posted a positive performance, rising by 1.80%, supported by gains in Eterna, which appreciated by 3.41%. Market breadth stood at 1.38x with 33 gainers and 24 losers. Market capitalization improved to ₦129.806 trillion from ₦128.969 trillion. Trading activity closed bearish, with turnover value decreasing to ₦19.262 billion from ₦24.47 billion and volume traded declined to 559.976 million units from 595.15 million units.

Commentary

The U.S. is trading mixed. The S&P 500 (-0.04%), Nasdaq (-0.11%), and Dow Jones (-0.23%) on geopolitical tensions and rising oil prices, while the Russell gained by 0.49% as investors rotated into domestic-focused stocks. European markets closed broadly negative. The STOXX (-0.28%), FTSE (+0.69%), and CAC (-0.4%), and DAX (-0.79%), due to rising geopolitical tensions in the Middle East and expectations of further interest rate hikes hurting investor sentiment. Asian markets declined broadly, as the Shanghai Composite (-0.74%), Hang Seng Index (-0.7%), and Nikkei 225 Index (-2.38%) amid weak sentiment from Donald Trump's mixed Middle East signals and tighter liquidity by the People's Bank of China.