Global Markets:

United States

The United States (US) labour market showed mild softening this week, as initial jobless claims rose slightly but remained historically low, indicating that while layoffs are rising modestly, overall labuor conditions are still relatively resilient rather than sharply deteriorating. Despite this, Wall Street remained strong, with the S&P 500 and Dow Jones reaching nearrecord highs on optimism over a soft-landing and resilient corporate earnings.

Euro Area

Euro Area inflation hit the European Central Bank (ECB)’s target: In December 2025, annual inflation in the Euro Area eased to 2.0% (exactly on the ECB’s target rate) down from 2.1% in November. Core inflation (excluding food and energy) also moderates slightly, easing pressure on monetary policy and bolstering expectations that the ECB will keep interest rates unchanged in the near term.Asia

China’s inflation dynamics showed mixed signals, with December consumer prices rising to a ~3-year high driven largely by food prices, yet overall inflation remains weak and the Producer Price Index (PPI) continued to fall, underscoring persistent domestic demand weakness and structural challenges in the economy

Oil Markets

Oil prices closed higher, after a sharp rebound from the prior sessions as markets fretted over potential supply disruptions in Russia and Iran, while developments in Venezuela continued to command attention.

Outlook:

This week, markets are likely to remain cautious, balancing resilient US labour data and supportive policies against slowing growth and weak demand. US stocks may hold near highs, Europe may see modest moves on soft Purchasing Managers Index (PMI) data, and Asia could be mixed with China supported by policy but constrained by weak demand. Oil may stay pressured from oversupply, while metals like copper could see support from infrastructure demand. 

Domestic Economy:

Total foreign exchange inflows into the FX market rose sharply by 38% month on month to $2.8 billion in December 2025, marking a rebound from the much steeper 67% contraction recorded in the previous month. While most supply sources improved, domestic corporate inflows fell to $420 million (down 5%) month on month. The overall volume remains the second lowest in 16 months, signalling that foreign exchange liquidity remains fragile

Equity Market:

The Nigerian Exchange All Share Index (NGX-ASI) rose by 3.72% week on week (W/W), closing at 162,298.08 points. Market capitalisation stood at ₦103.78tn and year to date (YTD) return stood at 4.30%.

Fixed Income and Money Market:

The fixed-income market was bearish last week as investors rotated capital into equity market. Nigerian Treasury Bill yields rose across the entire curve due to tepid demand, while the bond market remained mixed, seeing the 3-year, 5- year, 7-year, and 10-year tenors rise marginally. In the money market, the Open Repo (OPR) and Overnight (OVR) rates settled at 22.50% and 22.71%, respectively, while the 208-day OMO paper closed at a yield of 21.76%.

Outlook:

Equity Market

This week, the equity market is expected to remain positive but selective, supported by improving business confidence and strong momentum in consumer goods, banking, and insurance stocks. However, gains may moderate as investors make profits after recent advances and await fresh catalysts.

Fixed Income Market

The fixed-income market is likely to stay mixed, with Treasury bill yields remaining under mild downward pressure due to strong demand and ample liquidity, while bond yields may continue to move sideways. Investor positioning will remain cautious, focusing on attractive tenors amid elevated money market rates