MON NOV 04 2024-theGBJournal| The Treasury bond secondary market were bullish, as the average yield declined by 3bps to 19.1% by close of trade on Monday.
Across the benchmark curve, the average yield declined at the short (-13bps) end, driven by demand for the MAR-2025 (-70bps) bill, but remained unchanged at the mid and long segments.
The FGN Eurobonds Market traded on mixed sentiments last week.
The bears and the bulls each had their turns but ultimately, it was a bearish close to the week.
In addition, It was a data filled week from the U.S.
Amongst that data included the United JOLTS Job Openings which printed at 7.443M vs 7.99M expected against 7.861M prev, indicating a further slowdown of the jobs market.
The United States Q3 GDP data showed that the economy grew by 2.8% against 3% prior while the ADP employment change printed at 233k vs 130k predicted and 159k previous. Today, the NFP printed at 12K vs 106k predicted and 223k forecasted.
Week-on-week, the average benchmark yield appreciated by 15bps to close at 9.54%.
The T-bills secondary market traded on a bullish note, as the average yield contracted by 27bps to 24.0%.
Across the curve, the average yield contracted at the short (-4bps), mid (-51bps), and long (-25bps) segments following buying interests in the 80DTM (-10bps), 171DTM (-144bps), and 185DTM (-150bps) bills, respectively.
Similarly, the average yield declined by 6bps to 26.2% in the OMO segment.
Meanwhile, the fixed income market was fluid last week with average liquidity reaching N371.69bn, and a degree of market activity in the secondary markets, though the general tone of the market remained bearish.
Prices were influenced by expectations that OPEC+ (ie OPEC plus Russia) could delay planned production increases due to concerns over weak demand and rising supply.
Meanwhile, positive news from China’s manufacturing sector and rising tensions between Iran and Israel added uncertainty, contributing to the risk premium.
Despite these factors, oil prices still faced a weekly decline, likely reflecting weak employment data from the US.
We still expect Brent’s average price this year will exceed the US$77.96/bbl assumed in Nigeria’s 2024 budget.
The overnight lending rate expanded by 2bps to 19.7% in the absence of any significant funding pressure on the system.
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