Banking & Finance

IMF Upbeats on Nigeria’s Reform

Domestic Macroeconomy: IMF Upbeat on Nigeria’s Reform…Trade Surplus Dampened by Accelerated Import Bills
This week, we spotlight the post-Article IV Consultation assessment note on Nigeria by the International Monetary Fund (IMF) and the Q4:2023 Merchandise Trade Statistic by the NBS. For context, IMF Article IV Consultation is an annual exercise in which staff of the Bretton Woods institution meet with key decision makers (fiscal and monetary) and stakeholders in the country of interest to assess the trajectory of key macroeconomic indicators and policy actions, with a view to providing recommendations and support where necessary…

Global Equities Market: Clarity on Rate Cut Timing Spark Gains
This week, positive outing on key macroeconomic variables supported the perception of a buoyant global economy, giving credence to a possible interest rate cut in the coming months from central banks in US and Europe. As such, the MSCI World index rose 0.8% w/w…

Domestic Equities Market: Bullish Outing on Customs Street… ASI up 2.6% w/w
This week, domestic equities market performance was guided by a mix of resilient corporate earnings releases and the listing of TRANSPOWER on the exchange. As such, the NGX-ASI rose 2.6% w/w to 101,330.90 points. Likewise, market capitalisation rose by 2.5%, translating to a ₦3.3tn gain to ₦57.3tn, while YTD return strengthened to 35.5% (previously 32.1%)…

Foreign Exchange Market: NAFEM Rate Maintains Spread Over Parallel Rate Amid a Stable Market
At the start of the week, OPEC+ members extended its voluntary production cuts of 2.2mbpd into Q2:2024 to support the oil market amid concerns over demand and rising oil output from non-members. The expected positive impact on price from the cut coupled with positive trade data from China and uptick in India’s oil demand, was offset by skepticism around the supply cut and increase in US crude inventories. Consequently, Brent crude oil dipped 1.7% w/w to $82.10/bbl…

Money Market: Yields Tighten Further on Liquidity Curb
This week, system liquidity rose 4.5x to ₦2.6tn buoyed by borrowings at the Standing Lending Facility (₦8.0tn) as paper sales outstripped repayments by ₦2.0tn. Consequently, the OPR and OVN rates expanded by 2.7ppts and 2.8ppts respectively to 29.8% and 31.0%…

Bonds Market: Sell-off Persists as Investors Hunt for Better Returns
Investors’ appetite dwindled this week, following the shift in focus to T-bills and Savings bonds. This led to negative performance across all trading days, except for a positive showing on Friday, pulling the average yield higher by 59bps w/w to 17.7%. The bearish outing reflected across all tenors, leading to a yield uptick across the curve, with selloffs more pronounced on the long-end as yield advanced 93bps, while the short and mid-end bonds notched gains of 36bps and 24bps w/w, respectively.

Afrinvest Research

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