*Naira weakens by 0.04% to close at ₦1,375.41/$
By Bamidele Famoofo
The Nigerian equities market extended its bearish momentum on Tuesday, as the NGX All-Share Index (ASI) declined by
0.55 percent to close at 249,738.84 points.
Consequently, the year-to-date return moderated to 60.49 percent, while market
capitalization shed approximately ₦888.61 billion to settle at ₦160.09 trillion. Market breadth remained weak at 0.5x, with
37 decliners outweighing 18 gainers. Top gainers for the session included AUSTINLAZ, MCNICHOLS, INTENEGINS,
LEARNAFRICA, and HMCALL, while DANGSUGAR, TRANSPOWER, TIP, ABBEYBDS, and FIDELITYBNK led the laggards’ chart.
Sectoral performance was broadly negative, as losses were recorded across the Banking (-1.83%), Insurance (-1.41%),
Consumer Goods (-0.77%), Commodity (-0.86%), and Oil & Gas (-0.14%) indices, while the Industrial Goods index closed
flat. Trading activity was also subdued, with the number of deals, trading volume, and transaction value declining by
30.34 percent, 10.38 percent, and 33.46 percent respectively to 65,666 deals, 564.06 million shares, and ₦27.22 billion. Looking ahead, market
sentiment is expected to remain mixed in the next trading session as investors position cautiously ahead of the Muslim
festive holidays on Wednesday and Thursday.
At the money market, the Nigerian interbank offered rates (NIBOR) closed higher across all tenors on Tuesday, reflecting persistent liquidity
pressures in the banking system. The overnight rate rose by 4bps to 22.24 percent, while the 1-month, 3-month, and 6-month tenors advanced by 6bps, 15bps, and 45bps respectively. Meanwhile, funding rates remained stable, with the overnight
policy rate and open repo rate unchanged at 22.19 percent and 22.00 percent, respectively.
In the Treasury Bills secondary market, yields traded mixed as the 1-month and 12-month instruments declined by 6bps
and 2bps respectively, while the 6-month bill rose by 6bps and the 3-month tenor closed flat. Consequently, the average
NT-Bills yield eased marginally by 1bp to 17.48 percent, supported by improved investor demand and sustained positive
sentiment in the fixed-income market.
The FGN bond market closed on a bearish note on Tuesday, as average yields edged higher by 3bps to 16.25 percent, reflecting
weak investor sentiment and subdued demand for naira-denominated sovereign securities. The uptick in yields suggests
cautious positioning by domestic investors amid prevailing market uncertainties.
Conversely, the Eurobond market recorded a positive performance, with average yields declining by 7bps to 6.90 percent. The
rally was driven by improved global investor appetite and sustained confidence in Nigeria’s dollar-denominated sovereign
instruments, supported by a relatively favorable external outlook.
Meanwhile,the naira depreciated across both foreign exchange market segments on Tuesday, reflecting sustained pressure on the local currency. At the official NAFEM window, the naira weakened marginally by 0.04 percent to close at ₦1,375.41/$, while in the parallel market, it declined by 0.29 percent to settle at ₦1,370/$.
