August 29, 2025/United Capital Report

Global Markets:

United States

• US Q2 2025 Gross Domestic Product (GDP) rose to 3.3% from 3.0% reported in Q2 2024.
• The Q2 growth is due  to stronger spending, investment, and lower imports.
• S&P 500, DJIA, and NASDAQ all appreciated closing in the green.

Europe

• European indices fell amid French political risks.
• Investors were cautious ahead of the release of Euro Area inflation and US personal consumption expenditure reports.
• CAC 40, STOXX600 and FTSE 100 closed  in the red territory.

Asia

• Indian stocks ended lower as early gains from Fed rate cut optimism faded amid renewed concerns over China’s growth.
• Hong Kong’s Hang Seng Index rose early on strength in property and tech stocks but later reversed as corporate earnings disappointed.
• However, Shanghai Composite Index (SCHOMP) rallied on government stimulus and People Bank of China’s liquidity support.

Oil Markets

• Brent crude oil rose by 1.28% week-on-week to settle at $67.98 per barrel. 
• Oil prices are on track for a weekly gain amid uncertainty over Russian supply.

Outlook:

Global equity market could be volatile next week as investors weigh key US inflation and jobs data for clues on a potential Fed rate cut. Also, investors will monitor and react to political events in France. However, Chinese equities could outperform and enjoy selective rallies amid broader caution. This will depend on whether policy support translates into stronger domestic growth and improved investor confidence.

African Markets:

Mozambique

• Qatari conglomerate Al Mansour Holdings pledged US$20 billion investment in Mozambique.
• The funding will support key sectors including energy, agriculture, infrastructure, oil and gas, renewable power, fisheries, livestock, tourism, housing, healthcare, and logistics.
• This is in line with the country’s 2025–2029 development goals.

Kenya

• Standard and Poor’s global (S&P) upgraded Kenya’s sovereign credit rating from B- to B with a stable outlook.
• The upgrade was hinged on improved liquidity from strong export and remittance inflows.

South Africa

• Producer inflation climbed to 1.5% in July from 0.6% in June.
• However, the Rand was relatively steady at about 17.66 per US dollar.
• Meanwhile, gold fields reported a threefold increase in first-half profits.
• This is supported by record high average gold prices of around $3,281 per ounce and stronger output, which prompted an upward revision to its dividend.

Outlook:

African equities could trade with a mixed bias next week. Banking and resource-linked stocks could see selective gains on solid earnings momentum and elevated commodity prices. However, overall sentiment will likely remain cautious, weighed down by high domestic interest rates, inflationary pressures, volatile exchange rates, and subdued foreign portfolio inflows. Regional dynamics such as Nigeria’s FX liquidity position, South Africa’s fiscal concerns, and Kenya’s rising borrowing costs will further shape performance, keeping investors selective and favouring fundamentally strong stocks.

Domestic Economy:

 FEC Approved 2024–2027 Medium-Term Debt Strategy

• The Federal Executive Council (FEC) approved Nigeria’s 2024–2027 Medium-Term Debt Strategy (MTDS).
• The 2024–2027 MTDS adjusts the debt mix to 55:45 in favour of domestic borrowing, with a focus on longer-term local instruments.

US Posts Trade Surplus with Nigeria in H1 2025

• In H1 2025, the US registered a $576mn trade surplus with Nigeria, reversing a $779mn deficit from the prior year.
• The shift was driven by stronger US exports to Nigeria coupled with a decline in Nigerian shipments to the US.

Equity Market

• The NGX-ASI fell by 0.32% week on week (w/w), closing at 140,557.23 points.
• WAPCO (-3.38%), GTCO (-2.07%) and ETI (-3 .76%) led large cap losses.
• Market capitalisation dropped to ₦88.93tn due to profit taking.
• The Nigerian equity year-to-date returns stood at 36.56%.

Money Market

• System liquidity increased from a deficit balance of ₦0.39tn reported to ₦1.43tn surplus.
• Short-term rates were mixed, with Open Repo Rate (OPR) remaining unchanged to settle at 26.50%, and Overnight Rate (OVR) fell by 0.04% week-on-week to 26.96%.
• Open Market Operations (OMO) yields fell by 1.44% week-on-week to close at 23.08% for the 313-day paper.

Outlook:

Equity Market

Equity market could be cautiously optimistic, driven by expectations of a potential interest rate cut from the Central Bank of Nigeria due to moderating inflation, alongside a relatively stable Naira and an increase in foreign reserves.

Fixed Income Market

Fixed income market could remain attractive to investors seeking high yields. Prospect for potential rate cut by Fed could attract renewed foreign inflows.