……Also Mixed Sentiment In Eurobond Market
Researchers at Comercio Partners, one of Nigeria’s firms with core business in trading fixed income securities and equities as well as providing financial advisory and assets management services, have projected bearish sentiment in the nation’s Treasury Bills (TBs) and FGN’s Bond markets this week in view of the micro and macroeconomic indices that influenced transactions in the markets last week.
The analysts, in the ‘Comercio Partners Weekly Markets Round-up’ report circulated to our correspondent at the weekend, noted that amidst a constrained interbank liquidity setting, the Treasury Bills market predominantly witnessed bearish sentiments throughout the week.
They attributed the trend primarily to the adjustment of the offer amount, increased from N417 billion to N1 trillion, for the NTB auction conducted within the week, as the Debt Management Office (DMO) offered and allocated N1 trillion, with total subscriptions amounting to N1.98 trillion.
Similarly, the experts recalled that stop rates for the 91-, 182-, and 364-day papers closed higher compared to previous levels, standing at 17.24%, 18.00%, and 19.00%, respectively, as opposed to 5.00%, 7.50%, and 11.54% at the last auction.
In addition, they reported that post-auction, yields were repriced across the curve, with notable interest observed in the newly issued 1-year paper (6-Feb-25) and that as anticipated, the average benchmark yield surged by 512 bps, concluding the week at 15.05%.
The investment researchers anticipated sustained bearish sentiment this week.
The firm’s researchers recalled that the market also displayed a bearish trend for most of the trading sessions in the week because of the result of the NTB auction and noted that the bearish sentiment s further fuelled by the constrained liquidity in the system.
Consequently, they reported that the average benchmark yield concluded the week at 15.51%, marking a 63 bps increase on a week-over-week (WoW) basis.
On the FGN bond market outlook for this week, they anticipate a sustained continuation of this prevailing trend in the upcoming week.
However, the Comercio Partners’ researchers predicted that the FGN Eurobonds market would sustain mixed trading sentiments this week as it trended last week.
While recalling that demand for bonds was influenced by favorable policies from the Nigerian government and central bank addressing the FX conditions of the economy, the analysts noted that conversely, profit-taking activities towards the week’s end led to selling pressures.
