;
Win BIG in the AXA
Motor Insurance Promo
LEARN MORE
| title of post
Share on facebook
Share on twitter
Share on linkedin
Share on email
Share on facebook
Share on twitter
Share on linkedin
Share on email

Wk3 (January ’25) – Weekly Market Report

Key events on the Global Scene:


Markets Up; Core CPI better than expected

Markets Down; S&P 500 and Nasdaq weakened by 1.3% and 2.3% respectively
Global stock market sentiment was guided by better-than-estimated China’s Q4:2024 GDP, slow down in US core inflation, and brighter Fed rate-cut outlook. As such, the MSCI world equity index gained 2.0% WoW. In the US, while the consumer price index increased 0.4% in December as expected (12-month inflation rate – 2.9%), annual core CPI printed at better-than-anticipated rate of 3.2%, a notch down from the prior month – resuscitating bets on interest rate cut. This factor alongside renewed interest in tech stocks like Apple and Nvidia supported gains on the S&P 500 and Nasdaq indices, up 11.9% and 0.9% WoW, respectively.

Key events on the Domestic Scene:


Inflation Rate Rises to 34.80%

Nigeria’s Headline inflation rate rose to 34.80% YoY, an increase from 34.60% in November. This marks the fourth consecutive monthly rise and represents the highest level recorded in over six months. This uptick can largely be attributed to increased consumer demand during the festive season, which led to higher prices for a range of goods and services. Food inflation remained notably high at 39.84% YoY, slightly down from November’s 39.93%. Essential items, including yam, sweet potatoes, beer, corn, rice, and fish, saw significant price hikes. The surge in demand during the festive season further intensified these inflationary pressures. Additionally, the core inflation rate, which excludes the more volatile categories of food and energy, increased to 29.28% YoY in December, up from November’s 28.75%, highlighting persistent underlying inflationary pressures.

The Treasury Bills market saw sustained bullish activity throughout the week, particularly at the long end of the curve, with high demand for bills maturing between November 2025 and January 2026. Notable interest was observed in the December 2025 and January 2026 bills. Activity on the short end of the curve was limited due to a wide bid-ask spread. As the week closed, trading activity slowed, with participants selectively engaging across the spectrum. Overall, the average mid-rate for benchmark NTB papers declined by 34bps to 22.63%.

Bearish sentiments dominates as the ASI down 2.94% WoW …

  • The Nigeria bourse market closed the week on a bearish tone driven by selloffs in DANGCEM, ARADEL, TRANSCORP, and MTNN, despite bargain hunting in OANDO and DANGSUGAR. The All-Share Index dropped 294bps WoW, closing at 102,353.68 points, while market capitalization settled at ₦62.85 trillion. DANGCEM resumed trading after limit-down closes, with FPIs selling heavily in GTCO and NB. NASCON experienced a rally, which briefly extended to DANGSUGAR and MTNN, but profit-taking ensued. Major off-market trades included over 15 million units of BUAFOODS. Stanbic Holdings’ rights issue is ongoing, with ACCESSCORP listing additional shares from its recent rights issue.

  • Sectoral performance was mostly bearish, as four indices lost while the other two gained. On a week-on-week basis, the Industrial Goods (-8.20% WoW), Insurance (-6.23% WoW), Commodity (-3.56% WoW), Oil and Gas (-0.78% WoW), and Banking (-0.23% WoW) indexes lost value in the course of the week, following selloffs in DANGCEM (-16.46% WoW), WAPIC (-15.19% WoW), TRANSPOWER (-9.97% WoW), ARADEL (-7.02% WoW), and FBNH (-3.31% WoW), respectively. Meanwhile, the Consumer Goods index (+1.33% WoW) closed higher on the back of strong demand in DANGSUGAR (+16.67% WoW).

Capital Market Review/Outlook (FI and Equities):


  • The Eurobond market experienced a volatile week, initially facing a bearish trend as prices in SSA and North African regions plummeted due to reduced expectations for Fed rate cuts following a strong jobs report. A rebound was observed mid-week, driven by bullish sentiments across African sovereigns, spurred by discussions within the U.S. economic team and softer inflation data. Despite this, caution returned with notable sell-offs as participants realized gains. By week’s end, mixed to bearish trends prevailed, with the average mid-yield for Nigerian Eurobonds declining by 7bps WoW to 9.36%.

  • The FGN local bond market traded with a bearish sentiment throughout the week, with mid-dated papers such as the February 2031 and May 2033 bonds seeing offers at 22.10% and 21.20%, respectively. Selling pressures persisted, focusing on mid to long-dated papers, including February 2031, February 2034, and June 2053. Despite some demand for the February 2031 and February 2034 bonds, overall activity remained subdued due to cautious sentiment. The release of the Q1 2025 FGN bond issuance calendar added to the market’s caution. This calendar includes three offerings: a re-opening of the bond maturing on April 17, 2029, a re-opening of the bond maturing on February 21, 2031, and a newly issued bond maturing in January 2035 By week’s end, bearish sentiments prevailed, and the average mid-yield across the curve rose by 39bps WoW to 20.09%.​

Macro Economic Variables

EquitiesThis weekPrior week
S&P 5001.96%-0.93%
NGX ASI-2.94%2.5%
Fixed Income
Overnight32.33%27.86%
Open Buy Back32.75%27.29%
1 year T-bill21.4%21.5%
5-year bond21.43%21.22%
10-year bond21.40%20.86%
Currency
FX Reserves ($’bn)40.3540.48
USD/NGN1,546.721,542.03
Crude Oil (N/$)
Brent80.7979.76

Key Economic Variables

CPI (%) YoYDEC-24NOV-24
Headline Inflation34.80%34.6%
GDP (%) YoYQ3 24Q2 24
Real GDP3.46%3.19%
Monetary Policy Rate (%)27.50%

Securities Recommendations:

SecurityRationale
AXA Mansard Money Market FundThe fund is currently at c.20.92 as at 16th Jan, 2024.
Dollar Denominated Fixed DepositProtects the investor from devaluation of the Naira and exchange rate risk with a return of c.4% – 6%p.a
Fixed Income OpportunitiesTake advantage of our Naira fixed deposits with fixed rates from 18.85% to 23.80% p.a

Subscribe to our email alerts

Be the first to know about AXA's news directly in your mailbox

As explained in our Privacy Notice specifying the use we make of your personal data and for which duration your information will be kept, AXA SA, as data controller, processes your email address to send you the AXA newsletters. You have the right to withdraw your consent with regard to the above described processing at any time. However, please note that the withdrawal of your consent will not affect the lawfulness of processing based on consent before its withdrawal.