Author: Marketforces Africa

Equities Investors Lost N303bn as Market Correction Begins Equities investors lost N303 billion to sell pressures in the Nigerian Exchange (NGX) on the back of market correction of some overpriced stocks. The bullish momentum was halted on Thursday due to profit-taking activities in some medium- and blue-chip stocks after a series of monster rallies that included stocks with weak fundamentals.  Data from the Nigerian bourse showed that the market index snapped its 6-day positive streak as it shed 40 bps to close at 120,772.68 points, while market capitalisation declined by N303 billion to settle at N76.46 trillion. Top decliners include…

Nigeria’s Eurobond Yield Falls Sharply, Closed at 8.80% The average yield on Nigeria’s sovereign Eurobond fell sharply in the international market due to sustained demand from offshore investors seeking to take positions on economic recovery hopes and US Fed rate maintenance. The sovereign asset experienced a bullish moment driven by renewed investor demand across the curve. The NOV47, SEP-28, and SEP-51 bond saw the most buying interest, resulting in a sharp yield drop, investment firm Cowry Asset Limited said in an investor note. Fixed income market analysts highlighted that the broad-based demand led to a 14 bps decline in average…

Money Market Rates Spike over Banking System Liquidity Squeeze Money market rates—open repo rate and overnight lending rate—surged by 482 bps and 478 bps to reach 31.40% and 31.90%, respectively, as system liquidity closed at a short position of N29.1 billion. The interbank market swung to a deficit position due to CBN foreign exchange settlements and commercial bank outflows to the central bank, AIICO Capital Limited said in a note. Analysts explained that the liquidity squeeze drove rates sharply higher, with benchmarks reaching 32%. The repo rate jumped 4.82% to 31.40%, while the overnight rate rose 4.77% to 31.90% ahead…

Nigerian Treasury Bills Yield Eased on Soft Rally Proceedings in the Treasury bill secondary market were bullish, as the average yield contracted by 11 basis points (bps) to 20.4%. The market experience increased demand for the naira assets as yield-seeking investors continue to put their funds to work. High yields in addition to a positive real return on investment and disinflation make a good case for local investors strong appetite in the secondary market in the absence of a midweek auction. Across the curve, the average yield contracted at the short (-1bp) and long (-23bps) ends, investment firm Cordros Capital…

Senate Extends 2024 Budget Implementation to Dec. 31 The Senate has approved a fresh extension of the implementation of the capital component of the 2024 national budget from June 30 to Dec. 31. The decision was reached during plenary on Tuesday, following the presentation and expeditious passage of an amendment bill to the Appropriation Act. The legislation, read and passed through first, second, and third readings in a single sitting, received overwhelming support from lawmakers. Deputy Senate President Sen. Jibrin Barau announced the resolution following the adoption of the report by the Senate Committee on Supply. The debate was led…

Naira Falls to N1549 as Demand for Dollar Eclipses FX Supply The naira fell against the US dollar to N1549, according to data from the Central Bank of Nigeria (CBN) foreign exchange platform. The Nigerian local currency experienced mild demand shock amidst FX intervention slowdown, with transactions consummated between N1547.50 and N1550.50 per dollar before closing at N1549.03. Despite pumping $86.6 million into the forex market last week, there were additional inflows from foreign portfolio investors (FPI), exporters, and non-bank corporates. The Nigerian forex market has appeared to be relatively dry in the last two days, causing the exchange rate…

Fitch Affirms InfraCredit’s Insurer Financial Strength Rating at BB- Global ratings agency Fitch has affirmed Infrastructure Credit Guarantee Company PLC’s (InfraCredit) Insurer Financial Strength (IFS) Rating at ‘BB-‘ and National IFS Rating at ‘AAA(nga)’ with outlooks accorded as stable. The ratings reflect InfraCredit’s high investment concentration in Nigerian sovereign bonds, its good capitalisation and leverage, and its business profile as a Nigeria-focused financial guarantor, Fitch said. Ratings analysts said high investment concentration in Nigerian sovereign bonds continues to constrain InfraCredit’s rating and is the primary driver of its very high risky asset ratio of 382% in 2024 from 388% in…

Nigerian Exchange Expands to N75.58trn as Investors Gain N764bn The Nigerian Exchange (NGX) expanded to N75.58 trillion as equities portfolio value grew by N764 billion on the back of a monster rally in the local bourse. The domestic exchange closed in positive territory, extending its bullish run from the previous sessions, as key market performance indicators appreciated by 1.02%. The year-to-date return advanced to 16.4% as stock market activities continued to improve. The upward trajectory was fueled by sustained buying interest in medium- and large-scale stocks, particularly DANGSUGAR, OKOMUOIL, WAPCO, and ELLAHLAKES, among others, reflecting continued investor confidence in the…

Okomu Oil, Dangote Drive Intraday Gain in Equities Market Okomu Oil, Dangote Sugar Refinery Plc, and a host of other early risers are driving momentum in the equities segment of the Nigerian Exchange (NGX) on Tuesday, stockbrokers said in midday notes. The domestic bourse is booming with happy investors taking positions amidst an ongoing boom in the local bourse, which has continued to break out of resistance. The market capitalisation and other key performance indexes are at the all-time record ahead of the second quarter earnings season. At midday, the NGX All Share Index recorded a gain of 0.57%, Alpha…

DMO Slashes Interest Rate on Nigerian Bond, Rejects Excess Bids The Debt Management Office (DMO) slashed the rate on Nigerian bonds maturing in April 2029 at the primary market auction, a move that was supported by excess demand from investors seeking to take positions in the naira assets. The authority floated N100 billion in bonds for subscription across reopening and a fresh issue of N50 billion each. The authority allotment matched its total offer but reduced the rate on the 5-year bond that was reopened. Details from the auction results showed that aggregate demand was 6 times more, allowing the…