Monday, February 05

AXA Mansard Monthly Commentary Recap

Economy Overview in December

On the Global Scene, In response to the current economic landscape, the US Federal Reserve has opted to maintain the interest rate at 5.5%, signaling a deliberate stance on avoiding immediate rate reductions. The S&P500 responded positively, gaining +1.11% in the wake of this decision. The Fed recognized the ongoing expansion of the US economy, noting a moderation in job gains since the beginning of the previous year. Despite this, employment remains robust, and the unemployment rate remains low. Inflation, while having eased over the past year, continues to be elevated.

The committee acknowledged the existing risks in achieving both employment and inflation objectives, emphasizing the uncertainty in the economic outlook. Attention is keenly focused on inflation risks, reflecting the Federal Reserve's cautious and vigilant approach to the evolving economic conditions.

In December 2023, Nigeria's headline inflation climbed to 28.92% YoY, marking a 0.72% increase from the 28.20% recorded in November 2023. On a month-over-month (MoM) basis, headline inflation rose to 2.29% in December 2023, showing a 0.20% uptick from the 2.09% reported in November 2023.

The primary driver behind this upward trend was the Food Inflation component, which surged by 33.93% YoY, reflecting a 1.09% rise compared to the 32.84% reported in November 2023. On a MoM basis, food inflation increased to 2.72% in December 2023, indicating a 0.30% rise from the 2.42% recorded in November 2023.

Oil prices inched slightly higher as brent crude closed the month at $82.07 per barrel (vs. $77.53 per barrel in December) as geopolitical concerns remains major contributors to price fluctuations in the market



Monthly Indicators

Dec 2023

Jan 2024

Average Inflation (%)



Oil Price($/b)



Exchange Rate(N/$)



External Reserves($`bn)



Monetary Policy Rate(%)



Quaterly Indicators

Q3 2023

Q4 2023

Real GDP Growth (%)



Oil Production(mbpd)



The Nigerian Capital Market

The Domestic Equity Market closed the month of January 2024 on a positive note, as the All-Shares Index surged by 35.3%, reaching 101,154.46pts with market capitalization at N55.537trillion representing an increase of N14.44trillion within the month under review.

Sectoral performance revealed that NGX Banking Index dropped by 3.4% to 866.93basis points from 897.20 basis points it opened this year, while NGX Consumer Goods Index closed at 1,394.05 basis points, representing an increase of c.24% from 1,121.29 basis points it opened for trading in 2024

As NGX Oil/Gas Index gained 19.9% to close January 31, 2024, at 1,251.22 basis points from 1,043.06 basis points, NGX Industrial Index emerged the best-performing index, gaining c.107.86 % to close at 5,637.83 basis points as of January 31, 2024, from 2,712.27 basis points the stock market closed for trading in 2023


The Nigerian Fixed income was largely bullish in the month of January as investors cherry-picked most on-the-runs maturities at attractive levels. Consequently, average yields declined by 99bps (vs 15.80% in Nov’23).

At the FGN Bond Auction, the DMO offered four maturities- Mar’27, Apr 29, Jun’38 and Jun’33 with stop rates at 15%, 15.5%, 16.0% and 16.50% respectively with the DMO selling a total of N360bn with Total bid/cover ratio at c.1.45x.

At the last NTB primary auction conducted during the month, stop rates stood at 5%, 7.15% and 11.54% for the 91-day, 182-day and 364-day papers respectively. The DMO allocated N231.82bn across the three tenors surpassing the offer size by 4.69x. Despite the surge in rates, market was stirred moderately, given that the stop rates were at similar levels with the secondary market rates.

In February, we expect elevated liquidity on the back of expected maturities, coupon payments and FACC inflows. Albeit, with the MPC meeting in the month we opine yields may inch slightly higher also strengthened by CBN operations such as CRR debits and OMO auctions.


Securities Recommendations:




AXA Mansard Money Market Fund

The fund is currently at c.11.06% as at 5th February, 2024.


Protects the investor from devaluation of the Naira and exchange rate risk, with a return of c.5% p.a



This article is prepared for informational purposes only and is not intended to predict or guarantee the future performance of any individual security, market sector, or markets. The views and strategies described may not be appropriate for all investors. While every effort has been made to ensure the information provided is accurate, do not rely solely on this information to make a financial or investment decision. Kindly consult your financial adviser before making any financial or investment decision.

AXA Mansard Investments Limited and its employees do not assume any liability or responsibility in relation to the information provided in this material.