Profit-taking dominated the Nigerian equities market this week as investors consolidated recent gains across select large cap names. Sell pressures on BUAFOODS (-6.6%), MTNN (-2.6%), DANGCEM (-2.6%), WAPCO (-4.8%), and TRANSCORP (-4.3%) dragged the All-Share Index lower by 1.1% to 192,826.77 points,
February 27, 2027/Cordros Report
Global
According to the United States Department of Labor, initial jobless claims rose by 4,000 to 212,000 in the week ended 21 February, up from 208,000 in the prior week, slightly below market expectations of 215,000. Although claims eased marginally, partly reflecting holiday related distortions, the broader data set points to sustained strength in the US labor market, as total jobless claims remain below the comparable level observed in the prior year (243,000). On a non-seasonally adjusted basis, the largest increase was recorded in Rhode Island (+1,523), while the most significant declines were in Michigan (-3,648), New York (-2,589), Ohio (-2,094), Texas (-1,588) and Pennsylvania (-1,061). Similarly, the 4-week moving average rose modestly by 750, bringing it to 220,250 from the previous week’s reading of 219,500. In the near term, the US labour market is likely to remain resilient, with low and stable jobless claims pointing to limited layoffs and sustained labour demand. While some regional adjustments are evident, they do not yet signal a broad-based softening, suggesting that any easing in labour market conditions is likely to be gradual rather than abrupt.
At its February 2026 meeting, the People’s Bank of China (PBoC) left benchmark lending rates unchanged for the ninth consecutive month, keeping the one-year and five-year Loan Prime Rates at 3.00% and 3.50%, respectively. In our view, the decision reflects a deliberate preference for policy stability, as authorities balance growth support with financial stability and exchange rate considerations. Given that 2025FY GDP growth (5.0% y/y) is broadly in line with the official target, we believe policymakers are comfortable maintaining the current rate stance. Specifically, rather than pursuing broad based rate cuts, the PBoC is relying on targeted instruments, such as structural lending facilities and potential adjustments to the reserve requirement ratio (RRR), to channel credit to priority sectors and support domestic demand, particularly amid persistent property sector weakness. Looking ahead, the PBoC is expected to maintain a cautious, data-driven approach. While subdued inflation leaves room for easing, we see incremental liquidity support as a more likely tool than outright benchmark rate reductions in the near term.
Global Market
Global stock markets traded choppily this week as investors navigated renewed tariff uncertainty, geopolitical developments, corporate earnings releases, and ongoing debate around AI-driven disruption across traditional sectors. At the time of writing, US equities (DJIA: -0.3%; S&P 500: flat; NASDAQ 100: flat) were poised to close the week marginally lower, reflecting concerns over tariff policy, geopolitical tensions, stronger-than-expected producer price data and mixed reactions to corporate earnings—most notably from NVDA. In Europe, major indices (STOXX Europe: +0.4%; FTSE 100: +1.5%) advanced, supported by gains in banking and mining stocks amid solid earnings and firmer metal prices. Sentiment was further buoyed late in the week by easing concerns around AI-related disruptions and a softer-than-expected inflation print in Germany. Asian markets (Nikkei 225: +3.6%; SSE: +2.0%) also closed higher, driven by Japan’s reaffirmation of its trade commitment with the US, optimism over potentially lower US tariffs on China, a weaker yen, and supportive policy signals from the PBoC. Elsewhere, Emerging and Frontier market indices (MSCI EM: +3.3%; MSCI FM: +0.3%) advanced, led by gains in China (+2.0%) and Vietnam (+3.1%), respectively.
Domestic Economy
At the February meeting, the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) reduced the Monetary Policy Rate (MPR) by 50bps to 26.50% (Previous: 27.00%), following a hold at the last meeting. The Committee’s decision was underpinned by sustained disinflation, naira appreciation, and an improved external position. However, the Committee maintained all other parameters, including the asymmetric corridor around the MPR at +50bps/-450bps, and the Cash Reserve Requirement (CRR) for Deposit Money Banks (DMBs), Merchant Banks, and non-Treasury Single Account (TSA) public sector deposits at 45.0%, 16.0%, and 75.0%, respectively. Also, the liquidity ratio was left unchanged at 30.0%. Looking ahead, we maintain that the disinflation process is likely to gather pace in the first half of the year, supported by favourable base effects and sustained naira appreciation. This is likely to create additional scope for faster policy easing in the near term, as disinflation widens the positive real policy rate. Accordingly, barring any material shocks, we anticipate a further 100bps reduction in the MPR at the May meeting.
According to the Debt Management Office (DMO), Nigeria’s public debt increased modestly by 0.6% q/q to NGN153.29 trillion in Q3-25 (Q2-25: NGN152.40 trillion). We attribute the increase to additional borrowings undertaken to finance rising government expenditures, driven by the continued revenue shortfall. Notably, the total domestic debt stock (53.4% of total public debt) increased by 1.6% q/q to NGN81.82 trillion (Q2-25: NGN80.55 trillion), reflecting the increase in Federal government debt stock (+1.6% q/q) and states debt stock (+1.0% q/q). At the same time, total external debt stock (46.6% of the total public debt) increased by 3.1% q/q to USD48.46 billion (vs +2.2% q/q to USD46.98 billion in Q2-25). The increase reflects additional disbursements from multilateral lenders (+0.9% q/q), including the World Bank (USD157.70 million) and the African Development Bank Group (USD61.65 million), alongside higher borrowings from bilateral sources (+1.3% q/q) and a sharp uptick in syndicated loans (+437.7% q/q). In naira terms, total external debt declined by 0.5% q/q to NGN71.48 trillion (Q2-25: NGN71.85 trillion), reflecting naira appreciation as the average exchange rate appreciated by 3.7% q/q to NGN1,474.85/USD in Q3-25 (Q2-25: NGN1,529.21/USD). On a year-on-year basis, total debt grew by 7.7%. Looking ahead, we expect total public debt to continue rising, albeit at a measured pace, reflecting sustained borrowing across both domestic and external markets. However, the appreciation of the naira should mitigate the growth in external debt when expressed in local currency terms, thereby tempering the overall increase in the debt stock. Consequently, we estimate total public debt to rise by 0.7% q/q to NGN154.36 trillion in Q4-25E, equivalent to 35.4% of GDP (Q3-25: NGN153.29 trillion | Q4-24: NGN144.67 trillion).
Capital markets
Equities
Profit-taking dominated the Nigerian equities market this week as investors consolidated recent gains across select large cap names. Sell pressures on BUAFOODS (-6.6%), MTNN (-2.6%), DANGCEM (-2.6%), WAPCO (-4.8%), and TRANSCORP (-4.3%) dragged the All-Share Index lower by 1.1% to 192,826.77 points, moderating month-to-date and year-to-date returns to +16.6% and +23.9%, respectively. Trading activity was mixed, with volume declining by 16.9% w/w, while value surged by 91.8% w/w. Sectoral performance was broadly negative, as the Consumer Goods (-3.5%), Industrial Goods (-0.7%), Insurance (-0.6%), and Oil & Gas (-0.4%) indices closed lower, while the Banking (+0.7%) index was the sole gainer for the week.
Looking ahead, we expect a mixed market tone as investors continue to digest 2025FY audited results and dividend declarations across key names. Over the medium term, market direction will likely hinge on macroeconomic trends, Q1-26 earnings releases, corporate actions, and the sustainability of foreign and domestic investor flows.
Money Market and Fixed Income
Money Market
The OVN rate moderated by 54bps to 22.2%, as robust system liquidity conditions persisted. Liquidity was primarily supported by inflows from OMO maturities (NGN730.70 billion) and FGN bond coupon payments (NGN656.08 billion), as well as the recent 50bps reduction in the MPR, which collectively offset debits of NGN1.11 trillion from OMO sales and NGN524.27 billion from FGN bond PMA. Consequently, system liquidity remained firmly positive, with the average net long position settling at NGN3.14 trillion, compared with NGN2.94 trillion in the prior week.
In the absence of offsetting liquidity sterilisation measures next week, the anticipated NGN951.20 billion inflow from OMO maturities is expected to support system liquidity, likely causing the OVN rate to taper.
Treasury Bills
Bearish sentiments prevailed in the Treasury Bills secondary market following the underwhelming 50bps cut. Accordingly, the average yield across all instruments increased by 23bps to 19.2%. Across segments, average NTB yields declined by 22bps to 17.2%, while average OMO yields advanced by 67bps to 21.2%. The CBN conducted an OMO auction to mop up excess liquidity, offering NGN600.00 billion across the 6, 104, and 167-day maturities. Eventually, a total of NGN1.11 trillion was issued at stop rates of 21.94%, 18.45%, and 18.77%, respectively.
Given our expectation of robust system liquidity, we anticipate yields in the Treasury bills secondary market to moderate. Furthermore, the DMO is scheduled to conduct an NTB PMA next Wednesday (March 4), with NGN1.05 trillion worth of bills on offer.
Bonds
The FGN bond market closed the week bullish, with average yields declining by 48bps to 15.5%, despite notable volatility. Sentiment was initially cautious as participants focused on the primary bond auction. Following the DMO’s under allocation and stop rates that cleared prevailing secondary market levels below, the market reacted strongly bullish, triggering renewed buying interest across the curve. Subsequently, investors positioned for a sizable MPC rate cut, driving yields lower. However, sentiment reversed after the rate decision fell short of expectations, prompting improved offers from local investors before the market ultimately stabilised into the week’s close. Across the curve, the average yield decreased at the short (-36bps), mid (-71bps), and long (-64bps) segments following demand for the FEB-2031 (-82bps), MAR-2035 (-110bps) and MAR-2036 (-104bps) bonds, respectively. At Monday’s FGN bond auction, the DMO reopened the JUN-2032, MAY-2033 and FEB-2034 bonds, offering a total of NGN800.00 billion. Total demand settled at NGN2.70 trillion (bid-to-offer: 3.4x), with the DMO eventually allotting NGN524.28 billion (bid-to-cover: 5.1x). The stop rate on the FEB 2034, which was on-the-run last month, declined by 200bps to 15.50%.
Over the medium to long term, FGN bond yields are likely to pare, driven by expectations of a sustained easing cycle and sizable liquidity in the financial system.
Foreign Exchange
The naira depreciated this week by 2.1% w/w to NGN1,369.00/USD as demand pressures undermined improved inflows from FPIs looking to participate in the OMO PMA and the USD200.00 million intervention by the CBN. Also, the gross FX reserves increased this week by USD609.76 million w/w to USD49.51 billion (February 25), marking the tenth consecutive week of increase. In the forwards market, the naira rates depreciated across the 1-month (-1.5% to NGN1,389.06/USD), 3-month (-1.6% to NGN1,426.89/USD), 6-month (-1.4% to NGN1,474.65/USD) and 1-year (-1.3% to NGN1,568.70/USD) contracts.
We expect the naira to remain broadly stable in the near term, supported by a weaker dollar and a favourable external position characterised by a sustained current account surplus and strong foreign exchange reserves. In addition, continued investor confidence and elevated naira yields should sustain capital inflows, helping to anchor the exchange rate.
