The domestic equity market closed the week on a positive note, recovering from an early-week sell-off on the back of improved investor sentiment. Precisely, buying interest in AIRTELAFRI (+10.0%), MTNN (+3.2%), FIRSTHOLDCO (+11.5%), GTCO (+0.9%) and OANDO (+10.4%) lifted the All-Share Index by 0.6% w/w to 244,738.74 points.
June 11, 2026/Cordros Report
Global
According to the Bureau of Labour Statistics (BLS), US headline inflation rose for the third consecutive month to its highest level in three years, printing at +4.2% y/y in May (April: +3.8% y/y), broadly in line with market expectations. The increase was driven primarily by sustained energy inflation, reflecting the still elevated oil prices linked to the ongoing Middle East tensions. Breaking down the data, energy prices jumped 23.5% y/y in May (April: +17.9% y/y), primarily due to the spike in gasoline (+40.5% y/y vs April: +28.4% y/y) and fuel oil (+58.9% y/y vs April: +54.3% y/y) prices. By contrast, food inflation moderated to +3.1% y/y (April: +3.2% y/y), reflecting lower prices for food at home (+2.7% y/y vs April: +2.9% y/y) and food away from home (+3.5% y/y vs April: +3.6% y/y). Elsewhere, core inflation (excluding volatile components) edged higher by 10bps to 2.9% y/y (April: +2.8% y/y) – the highest level since September 2025 – driven by higher prices across the apparel, shelter and medical care services components. On a month-on-month basis, consumer prices growth slowed to 0.5% m/m (April: +0.6% m/m), despite energy prices rising at a slightly faster pace. Looking ahead, we expect inflation risks to remain tilted to the upside, driven by the elevated oil prices and higher energy cost pass through. As such, the Fed is likely to keep rates unchanged at its June 17 meeting, in line with the CME FedWatch Tool’s 98.3% probability of a HOLD. However, sticky inflation and persistent upside risks are likely to keep the policy tone hawkish, leaving room for a rate hike if price pressures intensify.
At its recently concluded June 2026 policy meeting, the Governing Council of the European Central Bank (ECB) voted to raise its policy rate by 25bps for the first time since September 2023, citing the impact of the Middle East conflict on inflation. Specifically, the deposit facility, main refinancing operations and the marginal lending facilities were raised to 2.25%, 2.40% and 2.65%, respectively. Most notably, the Council revised its expectations for headline inflation, forecasting the 2026FY average to print at +3.0% y/y (Prev.: +2.6% y/y) while core inflation is expected to average +2.5% y/y (Prev.: +2.3% y/y) in the same period. At the same time, growth is now expected to average +0.8% y/y (Prev.: +0.9% y/y) for 2026FY. According to the Council, the revised figures largely reflect a higher path for energy prices, which, to some extent, is expected to feed into food, goods and services inflation. In addition, the Council emphasised that the decision was supported across scenarios, assessing its impact on the Euro area’s outlook. Looking ahead, the ECB noted that inflation risks remain tilted to the upside, while growth risks remain skewed to the downside, largely depending on the duration of the Middle East conflict, the scale of the energy price shock and its broader economic impact. Despite elevated inflation risks, we expect the ECB to maintain a cautious approach to monetary policy tightening, given the fragile growth backdrop. Accordingly, the ECB is likely to keep rates unchanged at its next meeting while assessing incoming data.
Global Markets
Risk-off sentiments dominated global equity markets this week, as the collapse of the US-Iran ceasefire negotiation reignited concerns around energy prices, supply disruptions and global inflation. The renewed escalation, marked by fresh US strikes on multiple Iranian military targets and retaliatory Iranian attacks on Gulf states, pushed oil prices higher and reinforced expectations of a prolonged period of tighter monetary policy across major economies. Market participants also assessed the US inflation print and the ECB’s interest rate decision and economic outlook. At the time of writing, major US indices (DJIA: -1.9%; S&P 500: -1.6%; NASDAQ: -2.1%) were poised to end the week lower, weighed down by renewed geopolitical risks, a hotter-than-expected May CPI print, and a sharp decline in semiconductor and AI-linked tickers. Similarly, European equities (STOXX Europe 600: -0.3%; FTSE 100: -0.6%) closed lower, as escalating tensions in the Middle East lifted oil prices and dampened investor risk appetite. Investors also reacted to the ECB’s latest rate hike, with higher borrowing cost expectations weighing on rate-sensitive sectors. The broader risk-off tone across global markets filtered through to Asia, with major indices (Nikkei 225: -3.6%; SSE: -1.0%) closing the week in negative territory. Finally, the Emerging Market (MSCI EM: -2.9%) and Frontier Market (MSCI FM: -1.4%) indices closed lower, reflecting losses in China (-1.0%) and Vietnam (-2.1%), respectively.
Domestic Economy
According to the trade report by the National Bureau of Statistics (NBS), total foreign trade declined by 6.6% y/y to NGN34.79 trillion in Q1-26 (Q1-25: NGN37.24 trillion | Q4-25: NGN36.21 trillion). The decline largely reflected the appreciation of the currency (+9.8% y/y to NGN1,385.72 in Q1-26 vs NGN1,521.80 in Q1-25), which reduced the naira value of foreign trade. Indeed, in dollar terms, total trade increased by 2.6% y/y to USD25.11 billion (+0.36% q/q), supported by the rise in total exports (+12.9% y/y to USD15.28 billion) amid a decline in total imports (-10.1% y/y to USD9.83 billion). The increase in total exports was primarily due to the rise in petroleum exports (+43.2% y/y) and non-oil exports (+10.5% y/y), which more than offset the decline in crude oil exports (-5.0% y/y). The weakness in crude oil exports was mainly due to softer crude oil production, which fell by 7.7% y/y to 1.55 mb/d in Q1-26 (Q1-25: 1.67 mb/d), despite the increase in crude oil prices to USD78.38/bbl from USD74.98/bbl over the same period. Meanwhile, total imports declined by 10.1% y/y to USD9.83 billion, largely reflecting the sharp contraction in petroleum product imports (-54.7% y/y), which more than offset the increase in non-oil imports (+15.7% y/y). Overall, the trade surplus widened by 109.7% y/y to USD5.45 billion in Q1-26 (Q1-25: USD2.60 billion), reflecting stronger export performance and lower import demand. Looking ahead, we expect export growth to remain supported by sustained expansion in non-oil exports, while the anticipated recovery in oil production and still elevated crude oil prices are likely to strengthen oil and gas related export earnings. On the import side, relative exchange rate stability and improved FX liquidity are expected to support firmer non-oil imports, although elevated inflation and weak purchasing power may limit the pace of expansion. At the same time, rising domestic refining capacity is likely to reduce petroleum product imports, partly offsetting the increase in broader import demand. Overall, we expect the trade surplus to widen in 2026E relative to the prior year.
Based on FMDQ data, total inflows into the Nigerian Foreign Exchange Market (NFEM) surged to a three-month high, rising by 46.1% m/m to USD4.17 billion in May (April: USD2.86 billion). The outturn was driven by broad based increases across inflows from local (55.5% of total inflows) and foreign (44.5% of total inflows) sources. Specifically, inflows from local sources rose by 89.5% m/m to USD2.32 billion (April: USD1.22 billion), reflecting increases across the Exporters/Importers (+123.2% m/m), non-bank corporates (+53.4% m/m), CBN (+20.7% m/m) and individuals (+8.1% m/m) segments. At the same time, inflows from foreign sources increased by 13.6% m/m to USD1.86 billion (April: USD1.63 billion), as the increase from the FDI (+32.2% m/m) and FPI (+15.8% m/m) segments offset the decline in the other corporates (-55.0% m/m) segment. The improvement in FPI inflows was driven by increases in equity investment (+72.6% m/m) and fixed income (+14.3% m/m) segments. In the near term, foreign inflows are expected to remain firm, supported by sustained market confidence and a stronger current account surplus. That said, persistent global uncertainties, particularly geopolitical tensions in the Middle East, may pose downside risks to foreign inflows and constrain overall FX liquidity growth.
Capital Markets
Equities
The domestic equity market closed the week on a positive note, recovering from an early-week sell-off on the back of improved investor sentiment. Precisely, buying interest in AIRTELAFRI (+10.0%), MTNN (+3.2%), FIRSTHOLDCO (+11.5%), GTCO (+0.9%) and OANDO (+10.4%) lifted the All-Share Index by 0.6% w/w to 244,738.74 points, bringing the month-to-date and year-to-date returns to +1.0% and +57.3%, respectively. On market activity, trading volume and value advanced by 28.3% w/w and 20.1% w/w, respectively. Meanwhile, Sector performance was mixed, as the Insurance (+1.6%), Banking (+1.0%), and Oil & Gas (+0.5%) indices advanced, while the Consumer Goods (-2.0%) and Industrial Goods (-1.0%) indices declined.
Looking ahead, trading activity is likely to remain volatile as investors balance profit taking with selective bargain hunting. Market participants will also monitor the May inflation report expected next week, which could influence expectations for future interest rate decisions.
Money Market and Fixed Income
Money Market
The OVN rate expanded by 6bps w/w to 22.2% as OMO PMA debits (NGN1.69 trillion) offset inflows from OMO maturities (NGN1.64 trillion). As a result, the average net long position declined to NGN4.19 trillion from NGN4.66 trillion in the previous week.
In the absence of any mop up operations by the CBN, system liquidity is expected to remain strong, further bolstered by inflows of NGN1.15 trillion from OMO maturities.
Treasury Bills
The Treasury Bills secondary market traded on a bearish note with average yields across the market expanding by 8bps to 18.8%. Across segments, average yields in the NTB secondary market expanded by 15bps to 17.7%, as investors repriced yields higher following the revised NTB issuance calendar, which increased the planned auction size for the June 17 auction to NGN1.00 trillion (Previously: NGN450.00 billion). Similarly, average yields in the OMO secondary market expanded by 7bps to settle at 21.0%, as investors unwound positions to partake in Tuesday’s OMO PMA. At the auction, the CBN offered NGN600.00 billion across tenors, with total demand reaching NGN1.69 trillion. The CBN ultimately allotted NGN1.69 trillion, with stop rates clearing at 21.89% and 20.02% for the 8- and 134-day tenors, respectively.
With system liquidity projected to remain strong in the coming week, we expect sustained demand for Treasury bills, likely causing yields to pare. However, the elevated supply could undermine the strong demand, causing yields to trend upwards. At the NTB PMA auction scheduled next Wednesday (June 17), NGN1.00 trillion in bills is expected to be offered.
Bonds
The FGN bond secondary market traded on a bearish note driven by domestic sell pressures. Consequently, the average yield expanded by 36bps to 16.7%. Across the benchmark curve, the average yield expanded at the mid (+40bps) and long (+55bps) segments, driven by selloffs of the APR-2029 (+90bps) and JUN-2038 (+116bps) bonds respectively, while the short (-3bps) end contracted due to demand for the MAR-2027 (-119bps) bond.
Over the medium term, we expect yields to remain elevated driven by the government’s elevated borrowing programme and continued risk off sentiment, especially from offshore investors.
Foreign Exchange
The naira depreciated 0.2% w/w to settle at NGN1,363.00/USD, as domestic demand marginally offset offshore inflows. Meanwhile, gross external reserves increased by USD231.50 million to USD50.42 billion (09 June 2026), marking the fifth consecutive week of growth. In the forwards market, the naira rates depreciated across the 3-month (-0.3% to NGN1,428.05/USD), 6-month (-0.7% to NGN1,487.48/USD) and 1-year (-1.0% to NGN1,602.31/USD) contracts, while closing flat on the 1-month (NGN1,385.96/USD) contract.
We expect the naira to remain broadly stable in the near term, underpinned by resilient portfolio inflows, strong market confidence, and a firm current account surplus. However, if the US-Iran conflict escalates further and triggers portfolio outflows, we expect the CBN to deploy measured FX interventions to contain excessive exchange rate volatility.
