Nigerian Equities Continue Upward Climb as System Liquidity Eases: ASI Hits 105,283.67

According to the Cowry Asset Management Daily Market Insight, the Nigerian equities market extended its recent rally on Wednesday, with the All-Share Index (ASI) inching up 0.51% to close at 105,283.67 points—its highest in weeks. The gain, although modest, reflects sustained investor optimism amid an improving macroeconomic backdrop and strengthening liquidity conditions in the financial system.

Market capitalization followed suit, rising to ₦66.16 trillion, a ₦338 billion gain in investor wealth. Trading activity was robust, with total volume and value increasing by 82% and 18% respectively, despite an 18.26% drop in the number of deals, indicating a tilt toward larger-ticket transactions.

Sector performance was mixed. Banking stocks led the charge with a 2.93% gain, followed by Consumer Goods (1.25%). However, the Insurance and Oil & Gas indices ended in the red, shedding 0.81% and 0.09% respectively. Industrial Goods and Commodities were largely flat. Market breadth was positive, with 34 stocks advancing and 17 declining—suggesting a strong undercurrent of bullish sentiment.

Money Market Liquidity Eases as NIBOR Declines

The Nigerian Interbank Offered Rate (NIBOR) saw declines across all maturities, supported by improved system liquidity. The Open Repo Rate remained steady at 0.0% to 2.50%, while the Overnight Lending Rate edged down by 8bps to 26.88%, indicating reduced stress in short-term funding markets. The Nigerian Treasury Bills Yield (NITTY) also declined, further underscoring subdued investor sentiment in the short-term fixed income space.

Bond Market Diverges on Domestic and Eurobond Fronts

The domestic bond market painted a more cautious picture, with yields on Federal Government of Nigeria (FGN) bonds rising marginally by 5bps to 19.04% amid mild bearish sentiment. In contrast, bullish activity continued on Nigeria’s Eurobond curve. The September 2028 maturity saw significant investor interest, pushing yields down by 46bps to 10.18%—a reflection of improving risk sentiment and demand for high-yielding frontier assets.

Naira Inches Up in Official and Parallel Markets

In the foreign exchange market, the Naira recorded marginal gains, appreciating by 0.02% to close at ₦1,602.30/$ at the official window. The parallel market also saw a slight uptick, with the Naira trading at ₦1,590/$, narrowing the spread between the two rates and providing modest relief to policymakers amid continued FX market reforms.

Investor Focus: Banks and Blue Chips

Today’s most active counters were dominated by financial heavyweights. Fidelity Bank accounted for 42% of total transaction value, followed by GTCO (21%) and MTNN (16%), reflecting institutional interest in stable dividend-paying blue chips. This aligns with recent flows targeting the banking sector, buoyed by earnings announcements and expectations of monetary easing.

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