Author: Marketforces Africa

Funding Rates Rise as T-Bills Auction Debit Squeezed Liquidity The money market funding rates heightened as outflows relating to Nigerian Treasury bills auctioned by the Debt Management Office squeezed the liquidity balance in the banking system. Banks maintained borrowing culture from the Central Bank of Nigeria (CBN) in an effort to meet their daily liquidity demand in a day money market. The financial system showed a marginal improvement but continued to operate at a deficit, affected by the net Treasury bills auction settlement debit of around N518.93 billion. The liquidity constraint in the money market caused an adjustment to the…

Naira Volatility Eased on CBN Successive Appearances in FX Market The naira exchange rate volatility eased as the Central Bank of Nigeria (CBN) sustained its aggressive forex market interventions. Spot FX data revealed that the naira strengthened by N3.99 against the US dollar in the official window to close at N1,548.59 as liquidity improved. Intraday transactions were consummated between N1,548 and N1,558 per greenback, according to FX traders amidst sustained intervention. The CBN has continued to make daily appearances in the forex market to defend the local currency, though its series of FX auctions have started to impart the gross…

NGX Index Falls as Investors Exit Positions in MTNN, Dangote The Nigerian Exchange (NGX) index, market capitalisation shrank as investors exited positions in MTN Nigeria, Dangote Sugar, and Aradel Holdings stocks. The trading session closed on a negative note on Thursday, with key performance indicators reflecting mixed results. The Nigerian Exchange All-Share index declined by 0.05% on the day, but equities market capitalisation surged marginally due to new listings.  Today, the market listed Lasaco Assurance Plc’s private placement of 9,250,000,000 ordinary shares at ₦1.20 per share. The NGX index dropped by 47.93 basis points in today’s trading session, reflecting a…

Oil Prices Decline Amidst Lower U.S Inventories Draw Oil prices fell following reports indicating an increase in US oil inventories and ongoing uncertainties surrounding the potential impact of US President Donald Trump’s planned energy policies on global oil demand. The international benchmark Brent crude fell by 0.1%, trading at $78.22 per barrel. The US benchmark West Texas Intermediate (WTI) decreased by 0.1%, reaching $75.21 per barrel, compared to its prior session close of $75.28. The downward movement in oil prices was further influenced by data suggesting a rise in US oil stocks, in the world’s largest oil-consuming country. Projections from…

IAS 29: Nigeria Not Hyperinflation Economy – Financial Reporting Council The Financial Reporting Council of Nigeria (FRC) says Nigeria is not yet an hyperinflation economy and citizens have confidence in its local currency. The council said this on Wednesday in a statement signed by the Executive Secretary/Chief Executive Officer, Dr Rabiu Olowo. The council noted that the International Accounting Standard (IAS) 29 which borders on Financial Reporting in Hyperinflationary Economies should not be applied in the preparation of financial statements for the 2024 financial year. IAS 29, Financial Reporting in Hyperinflationary Economies, on the other hand establishes rules for reporting…

Nigerian Bonds Yield Increased to 20.74% on Selloffs The average yield on Nigerian government bonds surged further to 20.74% in the secondary market due to sell pressure that has persisted for days. Investors in the local debt market have been offloading the local borrowing instruments ahead of new supply, with expectations that a higher inflation rate would act as catalysts for yield repricing. The market witnessed profit taking at the long end of the curve on Wednesday as the plan to rebase the country’s GDP and consumer price index raises a positive outlook on macroeconomic data. On Wednesday, investors sold…

Interest Rate on Nigerian Treasury Bills Drops to 21.80% The discount rate on 364-day Nigerian Treasury bills fell further at the primary market auction amidst a strong appetite for long-dated instruments. The slowdown in spot rate aligned with market expectations amidst the consumer price index rebasing plan. MarketForces Africa reported that the Debt Management Office conducted a primary market auction midweek on behalf of the Central Bank of Nigeria (CBN), where the authority offered N530 million worth of Treasury bills across standard maturities. At the auction, the DMO offered N530 billion across the 91-, 182-, and 364-day papers. Yield-hungry investors…

Interbank Rates Fall as FAAC Credit Eased Liquidity Pressure Interbank rates fall as money market pressures eased on the back of improved liquidity in the banking system, driven by inflows from the Federal Accounts Allocation Committee (FAAC). Analysts predict that liquidity will be further squeezed following N530 billion Treasury bills auction on Wednesday. According to market reports, the short-term interest rate benchmark declined to 30% range, though liquidity levels remained tight. Banks maintained borrowing streaks from the Central Bank of Nigeria’s (CBN) Standing Lending Facility (SLF) in the absence of significant fund inflows. Analysts predicted that local lenders would continue…

Banking Index Surges as Access Holdings, GTCO Rally The Nigerian Exchange (NGX) banking index advanced due to increased demand for Access Holdings and GTCO shares in the local bourse. Ticker: ACCESSCORP had the most traded units, with its 91.99 million units traded accounting for 23.30% of the total volume traded, stockbrokers said in their separate report. Despite a negative sectoral performance, the banking index was an outlier, recording a 0.61% uptick on the day due to demand for the Tier-1 stocks. Access Holdings PLC rose by 1.45% to N24.55 in the equities market as more than 91 million shares of…

MTN Nigeria Retreats amidst Tariff Hike Euphoria, Licence Renewal MTN Nigeria Plc market value bumped over sell pressures in the equities market, reversing its top maximum allowable gain in the previous day. Investors took profit selling part of their interest in MTN Nigeria Plc shares after a strong gain posted following a 50% tariff hike secured from the telecom regulator. On Wednesday, the telecom stock fell to N247 per share, losing N9.30 on the day as more than 2 million shares were transacted in the market. According to trading details, the share price had increased by 10% Tuesday as some…