Investors Exiting Positions in Bond Market Provoke Yield Surge
With sustained risk-off sentiment, local investors exiting positions in the Nigerian bond market have provoked a surge in benchmark yield in the secondary market segment.
Sell pressures persisted after an inflation jerk up triggered riskoff sentiment, with buckets of macroeconomic uncertainties mitigating against the investing environment.
Bonds sell-offs were observed at the short (+1 p) and mid-segment (+1 bp) of the curve on Monday, traders said in separate notes. Fixed income market analysts at CardinalStone Securities Limited said investors sold down JUL-30 (+2bps) and FEB-31 (+3bps) papers.
The notable offers for the February 2031 and May 2033 bonds dragged the yield curve down ahead of the first quarter of 2025 supply. In a note, AIICO Capital Limited said due to the significant spread between the bids and ask yields, only a few trades were executed.
Most of the sell trade centred on the auctioned bond May-33, which closed at 21.30%, 10 bps higher than its previous close of 21.20%, TrustBanc Financial Group Limited told investors in a note.
Traders reported that the inflow of coupon payments worth N66 billion triggered mild buying interest on the Jan-42 instrument, with trades consummated at 19.20%.
Overall, the average benchmark yield nudged higher by 1 basis point to settle at 20.07%, reflecting the presence of bearish bias. #Investors Exiting Positions in Bond Market Provoke Yield Surge CBN Opens FX Window for BDC to Stock up at NFEM Rate
