Author: Marketforces Africa

Naira Drops Value Against Dollar as FX Demand Rises The naira value dropped against the US dollar at the foreign exchange market due to increased demand for US dollars at the official window. Data from the Central Bank of Nigeria (CBN) showed that spot fx rate was quoted at N1530.25 per greenback. Further details revealed that the transaction rate reached an intraday high of N1533 and briefly touched N1527 per dollar before it closed at N1531. The exchange rate depreciated amidst rising external reserves, which printed higher at $37.638 billion at the beginning of the week, according to CBN Update,…

MTN Nigeria Hits N400 Per Share in Equities Market MTN Nigeria Plc rallied in the equities market on Wednesday as the price surged to N400 per share for the first time since it became a publicly listed company. The telecommunication company’s share price had plunged sharply before the latest market recovery, boosted by anticipation of earnings growth. According to data from the Nigerian Exchange (NGX), the telecom company’s share price rose to N400, its fresh all-time high, after successively breaking out every line of resistance. The price surge on Wednesday followed a huge volume of the telco stock traded at…

Nigeria’s Headline Inflation Rate Declines to 22.22% Nigeria’s headline inflation rate declined to 22.22%, the latest data released on Wednesday by the National Bureau of Statistics (NBS) revealed. This marked the third consecutive disinflation following the consumer price index rebasing exercise. Headline inflation eased by 75 basis points (bps) to 22.22% year on year in June from 22.97% in the preceding month. On a month-on-month basis, consumer prices increased to 1.68% from 1.53% in May. Food inflation increased by 83 bps to 21.97% in June from 21.14%. On a month-on-month basis, food inflation rose by 107 bps to 3.25% versus…

Oil Prices Ease as Demand Slows, OPEC+ Output Rises Oil prices declined in the global commodity market on Wednesday amidst a slowdown in aggregate demand, with data showing the Organisation of Petroleum Exporting Countries and allies members (OPEC+) pumped more in June. The market also react to uncertainty over the US Federal Reserve’s (Fed) interest rate outlook, following the release of inflation data and expectations of steady global supply. Brent crude decreased by around 0.17%, trading at $68.17 per barrel, while the US benchmark West Texas Intermediate (WTI) crude decreased by 0.16%, settling at $65.55 per barrel, compared to $65.66…

Sterling Financial Holdings to Raise $400m Sterling Financial Holdings Plc’s market value rose to N323 billion in the Nigerian stock market as investors’ sentiment improved amidst plan to raise $400 million. The financial services company’s share price rose to N6.2 at the beginning of the week as 36.637 million units of Sterling Financial Holdings Plc valued at N234.523 million were transacted in the local bourse. At the current market value, the banking stock is trading at a moderate discount to its 52-week high on the Nigerian Exchange trading platform. At the annual general meeting last week, Sterling Financial Holdings Plc…

Treasury Bills Yield Rises, Disinflation to Widen Real Return The average yield on Nigerian Treasury bills climbed slightly to 18.36% as the secondary market experienced mild selling pressure at the beginning of the week. Investors exited positions amidst successive squeezes in yields on the naira asset ahead of inflation data for June. The consumer price index has been projected to ease, reflecting the expectation that Nigeria’s reforms have started healing dislocated macro indicators. Inflation reduced to 22.97% in May, but the interest rate benchmark has remained unchanged at 27.75%, which makes the real return on investors hover at 4.53%. “If…

Oil Prices Fall Amidst Trump’s Plan to Sanction Russia Oil prices fell on Tuesday as geopolitical risks and market fundamentals continued to weigh on sentiment, with Brent crude trading at $68.71 per barrel. Brent had climbed to $70.53 on Monday before settling at $69.21 at the close. Brent crude was down 0.7% from the previous close, trading at $68.71 a barrel. At the same time, West Texas Intermediate (WTI) crude was priced at $66.39 per barrel. Market players focus on comments from US President Donald Trump, who recently warned that the US would impose 100% secondary tariffs on Russia if…

Benchmark Yield Crashes as Investors Hunt FGN Bonds The benchmark yield on Federal Government of Nigeria (FGN) bonds maintained downward movement in the secondary market as investors increased bets on the naira assets ahead of inflation with the expectation that supply for the third quarter will be tight and competitive. The bullish local bonds market has forced yield down below 17% due to tight supply expectations in the third quarter of the year. Investors are locking in elevated yields in anticipation that disinflation will force benchmark interest rates down—starting from the second half of the year. Inflation has reduced to…

Interbank Rates Rise, Liquidity Tightens as Banks Pay AMCON Levies Interbank rates edged higher with tightening liquidity levels in the financial system after deposit money banks settled their obligations to Asset Management Company (AMCON). Funding pressure heated up as the banking system deficit expanded to a N280.57 billion deficit, an increase of N118.11 billion on the day. Data from the FMDQ showed that money market rates remained at elevated levels following the monetary authority’s actions to keep liquidity at moderate levels. The effects of fast and sharp liquidity mopped up via huge open market operations forced banks to start pitching…

GCR Affirms Novare Fund Manager Nigeria Ratings with Stable Outlook GCR Ratings (GCR) has affirmed Novare Fund Manager Nigeria Limited’s national scale long-term and short-term issuer ratings of BBB+(NG) and A2(NG) respectively. The ratings agency also accorded the issuer rating outlook as stable. According to GCR, the ratings of Novare Fund Manager Nigeria Limited reflect the broad strengths and weaknesses of Novare Fund Manager Limited Mauritius. Ratings analysts explained that this is because Novare Nigeria is a core operating subsidiary of Novare Mauritius whose ultimate parent is South Africa-based Novare Holdings Proprietary Limited. The ratings balance the fund manager’s strong…