Global Markets

United States

The US Federal Reserve (Fed) held its benchmark interest rate steady at 3.50% – 3.75% for a third consecutive meeting, as policymakers remain cautious amid persistent inflationary pressures. While inflation has moderated from prior highs, it continues to run above the Fed’s 2% target, particularly within core services, and faces renewed upside risks from rising energy prices linked to geopolitical tensions. At the same time, broader economic conditions especially labour market and steady economic activity have reduced the urgency for policy easing. The decision reinforces a “higher-for-longer” stance, with the Fed signaling no urgency to cut policy rates until there is clear and sustained progress on disinflation.

Euro Area

The Euro Area’s flash Composite Purchasing Managers’ Index (PMI) declined sharply to 48.6 points in April 2026 from 50.7 points in March 2026, falling below the 50.0 points expansion threshold and signaling a renewed contraction in private-sector activity. The weakness was driven primarily by the services sector (47.4 points), while manufacturing remained in expansion at 52.2 points, though partly supported by temporary factors. The deterioration reflects softening demand, rising input costs, and heightened uncertainty linked to energy price pressures.

Asia

China’s manufacturing sector remained in mild expansion, with the official PMI at 50.3 points in April 2026 from 50.4 points in March 2026 and the Caixin PMI rising to 52.2 points in April 2026 from 51.7 points in March 2026, indicating stable-to-improving industrial momentum. Growth was supported by stronger export orders, higher production, and sustained global demand for industrial and technology goods.

Oil Markets

Oil markets sustained an upward trend during the week, supported by persistent geopolitical tensions and ongoing supply-side concerns. Bonny Light crude advanced by 20.78% to settle at US$136.86/bbl, extending its year-to-date gain to 115.80%. Similarly, Brent crude appreciated by 5.11% to US$110.44/bbl, with its year-to-date return rising to 81.50%. Overall, crude prices remain elevated, underscoring the market’s continued sensitivity to global supply disruptions and geopolitical developments.

Outlook

Global markets are expected to trade cautiously this week, driven by the Fed’s rate decision and major technology earnings. The Fed has held rates steady while maintaining a cautious, slightly hawkish tone, and the European Central Bank (ECB) is also expected to keep policy unchanged. AI sentiment remains fragile following reports that OpenAI missed internal growth targets, weighing on AI‑linked technology stocks. Energy markets remain elevated, with Brent crude trading around $110 per barrel amid continued disruption in the Strait of Hormuz. The United Arab Emirate (UAE) announced its exit from the Organisation of the Petroleum Exporting Countries (OPEC). Overall, markets are likely to stay volatile and range‑bound, with Fed communication, Powell’s tone, and tech earnings as the key near‑term drivers.

Domestic Economy

The composite Purchasing Managers’ Index (PMI) declined to 49.4 points in April 2026 from 53.2 points in March 2026, falling marginally below the 50‑point threshold and signalling a slight contraction in aggregate economic activity after sixteen (16) consecutive months of expansion. Sectoral indicators showed that both Industry and Services slipped into contractionary territory at 49.5 points and 48.8 points, respectively, while Agriculture remained marginally expansionary at 50.2 points. The observed moderation in business activity may reflect heightened geopolitical uncertainty and elevated risk tensions in the Middle East, which continue to weigh on production expectations, input costs, and overall business confidence.

Equity Market

The Nigerian Exchange All Share Index (NGX-ASI) extended its bullish run, gaining 7.33% week-on-week from 225,722.49 points to close at 242,277.81 points, lifting the year-to-date return to 55.69%. Market performance was broadly positive, driven by strong rallies in the Industrial Goods and Oil/Gas indices, which advanced by 16.89% and 14.37% respectively, while the Banking and Insurance indices posted weekly declines of 5.52% and 1.13% respectively.

Fixed Income and Money Market

The fixed income market reflected mixed but largely stable sentiment during the week, with modest movements across both money market and bond segments. In the money market, rates edged slightly lower, indicating adequate system liquidity. The Overnight (O/N) rate declined marginally by 0.10% to 22.11%, while the Open Repo Rate (OPR) remained unchanged at 22.00%. In the Nigerian Treasury Bills segment, yields moderated slightly across maturities, suggesting mild buying interest. The 91-day, 182-day, and 364-day instruments declined to 16.35%, 17.28%, and 18.84%, respectively. In the bond market, performance was mixed. Yields at the short end declined, with the 3-year dropping by 0.34% to 16.18% and the 7-year easing to 16.64%. However, the 5-year yield rose by 0.20% to 16.80%, while the 10-year remained unchanged at 14.95%, indicating subdued activity at the long end. Overall, the market exhibited a neutral to mildly bullish bias, with declining yields across most instruments amid steady liquidity conditions and selective investor demand.

Outlook:

Equity Market

The Nigerian equity market is expected to sustain its bullish bias this new week, supported by continued foreign investor interest, elevated oil prices, and improving corporate earnings momentum as Q1 2026 results season gathers pace. Banking, Building Materials and Oil & Gas stocks are likely to remain in focus, with strong results from leading names capable of driving index gains. However, profit-taking at elevated index levels remains a near-term risk, and broader global caution following the Fed’s decision to hold rates and Powell’s hawkish tone could temper foreign participation. Overall, the market is expected to trade positively but with selective momentum, as investors rotate toward value plays and earnings-driven names.

Fixed Income Market

The Nigerian fixed income market is expected to remain active, with system liquidity and Central Bank of Nigeria (CBN)’s open market operations continuing to set the tone for short-term yields. Nigerian Treasury Bill (NTB) demand is likely to stay firm from both domestic and foreign investors, particularly at the short end where real returns remain attractive. At the longer end, the 10-year yield currently around 14.95% is expected to hold broadly steady, with any meaningful compression dependent on the CBN’s policy signals and the direction of global rates. The Fed’s decision to hold rates, coupled with Powell’s hawkish tone, could dampen appetite for Nigerian fixed income among foreign portfolio investors and exert mild upward pressure on yields in the near term. Overall, the market is expected to remain range-bound, with the short end outperforming amid elevated liquidity and cautious sentiment at the long end.