The domestic bourse market closed the week on a negative note, as losses in BUACEMENT (-19.0%), BUAFOODS (-10.0%), NESTLE (-10.0%) and PRESCO (-10.0%) dragged the All-Share Index lower by 0.1% w/w to 243,462.13 points
July 17, 2026/Cordros Report
Global
According to the Bureau of Labour Statistics (BLS), US headline inflation slowed for the first time in five months to +3.5% y/y in June (May: +4.2% y/y) and below market expectations of +3.8% y/y. The moderation was primarily driven by lower energy prices, following the de-escalation of the US-Iran conflict in June. More specifically, growth in energy price growth slowed to +15.7% y/y (May: +23.5% y/y), reflecting lower gasoline (+26.7% y/y | May: +40.5% y/y) and fuel oil (+42.9% y/y | May: +58.9% y/y) prices. At the same time, food inflation eased to +3.0% y/y in June (May: +3.1% y/y) due to a moderation in prices for food away at home (+3.4% y/y vs May: +3.5% y/y) amid steady inflation for food at home (+2.7% y/y vs May: +2.7% y/y). Elsewhere, core inflation (excluding volatile components) eased by 30bps to 2.6% y/y (May: +2.9% y/y) driven by softer price increases across shelter, airline fares, apparel, medical care and household furnishings & operations. On a month-on-month basis, consumer prices pared for the first time since May 2020, printing a -0.4% m/m decline in June (May: +0.5% m/m), primarily due to the drop in energy prices. Looking ahead, despite the recent moderation in inflation, risks remain tilted to the upside. Renewed hostilities in the Middle East have pushed Brent prices above USD85.00/bbl, raising the prospect of renewed domestic energy and transport cost pressures that could slow the pace of disinflation. Meanwhile, given persistent uncertainty, we expect the Fed to continue to adopt a wait-and-see approach and keep its policy rate unchanged at the July 29 meeting, in line with the CME FedWatch Tool’s 89.8% probability of a HOLD.
According to the National Bureau of Statistics (NBS) of China, the world’s second-largest economy expanded by 4.3% y/y in Q2-26 (Q1-26: +5.0% y/y | Q2-25: +5.2% y/y), lagging market expectations of a +4.5% y/y growth. Notably, this was the weakest growth since Q4-22 and below China’s 4.5%-5.0% annual growth target. Precisely, soft domestic demand subdued private investment, while the prolonged property downturn outweighed continued support from resilient AI-related exports. Breaking down the data, the moderation was led by a broad-based slowdown across the Industry (+3.0% y/y | Q1-26: +4.9% y/y), Agriculture (+4.0% y/y | Q1-26: +4.3% y/y) and Services (+5.1% y/y | Q1-26: +5.2% y/y) sectors. The data show that the Chinese economy has become increasingly reliant on exports, with outbound shipments up 27.0% y/y. Meanwhile, the country continues to struggle to spur consumer demand and investment at home. On a quarter-on-quarter basis, the economy grew at a softer pace of +0.9% (Q1-26: +1.3% q/q). Looking ahead, we expect growth to remain subdued in Q3-26, as the sluggish property sector and fragile consumer confidence continue to weigh on consumer demand, undermining Beijing’s fiscal stimulus. These headwinds are expected to offset gains from AI-related exports. This aligns with the IMF’s growth forecast of 4.6% y/y in 2026E, 40bps below the 5.0% y/y recorded in 2025FY.
Global Markets
Global equities traded on a broadly negative note this week, as a deepening selloff in semiconductor and AI-linked names weighed on major markets, offsetting support from a softer-than-expected US inflation print. Market participants also assessed renewed US-Iran hostilities, which lifted oil prices, alongside a fresh batch of macroeconomic data and corporate earnings releases across major economies. At the time of writing, major US indices (DJIA: -0.4%; S&P 500: -1.3%; NASDAQ: -2.8%) were poised to close the week lower, weighed down by heavy losses across semiconductor names amid mounting concerns that AI hyperscalers may scale back infrastructure spending, with stronger-than-expected bank earnings providing only temporary support mid-week. Similarly, European equities (STOXX Europe 600: -0.4%; FTSE 100: -0.7%) closed lower, as renewed Middle East tensions lifted oil prices, with gains in energy stocks outweighed by losses in technology, travel and defence. Elsewhere, Asian markets (SSE: +5.6%; Nikkei 225: +6.9%) advanced, supported by a rebound in semiconductor and AI-linked names. Finally, the Emerging and Frontier Market (MSCI EM: +1.6%; MSCI FM: +0.5%) indices advanced, supported by gains in India (+0.5%) and Romania (+1.5%), respectively.
Domestic Economy
According to the National Bureau of Statistics (NBS), headline inflation eased marginally by 2bps to 15.91% y/y in June (May: 15.93% y/y), marking the first moderation after two consecutive months of increase. The moderation was driven by a deceleration in core inflation that offset the acceleration in food inflation. Specifically, the food index accelerated by 56 bps to 17.52% y/y (May: 16.96% y/y), primarily driven by constrained supply conditions stemming from the lean season and persistent insecurity in key food-producing areas. Conversely, core inflation moderated by 90bps to 15.92% y/y (May: 16.82% y/y), reflecting softer price pressures across the insurance and financial services, recreation, sport and culture, alcoholic beverages, tobacco & narcotics and restaurants & accommodation services sub-components. On a month-on-month basis, headline inflation slowed for the third consecutive month to 1.66% (May: 1.75% m/m), primarily reflecting softer energy prices and a broadly stable exchange rate, which helped contain price pressures. Looking ahead, we expect a mild increase in consumer prices on a month-on-month basis, reflecting still elevated energy costs, modest naira depreciation and lean-season pressures on food supply. Accordingly, we expect inflation to rise to 1.97% m/m in July (June: +1.66% m/m). Nevertheless, the annual inflation rate is expected to moderate slightly to 15.89% y/y (June: 15.91% y/y), reflecting a favourable base effect rather than any material improvement in price dynamics.
According to data from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Nigeria’s crude oil production (including condensates) increased for the fourth straight month, rising to 1.74 mb/d in June (May: 1.70 mb/d) – its highest level since the 21st of March. The improved performance was driven by stable production operations across most producing assets and the absence of major pipeline outages during the period, which boosted production uptime and crude evacuation efficiency. Notably, the increases recorded across the Anyala Madu (+6.2% m/m), Bonny (+4.8% m/m), Agbami (+3.6%m/m) and Forcados (+2.3% m/m) terminal were enough to offset the declines across the Qua Iboe (-8.0% m/m), Brass (-7.0% m/m), Odudu (-4.7% m/m), Bonga (-2.2% m/m), Tulja – Okwuibome (-1.8%) and Escravos (-1.4% m/m) terminals. In the near term, crude oil production is expected to increase, supported by higher investment, improved security conditions, and the integration of new oil fields and evacuation routes. However, intermittent terminal shutdowns, driven in part by persistent infrastructure constraints, remain a key downside risk. Overall, we retain our average crude oil production estimate of 1.70 mb/d in 2026E.
Capital Markets
Equities
The domestic bourse market closed the week on a negative note, as losses in BUACEMENT (-19.0%), BUAFOODS (-10.0%), NESTLE (-10.0%) and PRESCO (-10.0%) dragged the All-Share Index lower by 0.1% w/w to 243,462.13 points, bringing the month-to-date and year-to-date returns to +6.1% and +56.5%. On market activity, trading volume and value declined by 20.7% w/w and 15.5% w/w, respectively. On sector performance, the Industrial Goods (-3.1%) and Consumer Goods (-0.2%) indices closed lower, while the Banking (+9.3%) and Insurance (+2.5%) indices closed higher. The Oil & Gas index closed flat.
In the coming week, we expect market activity to be shaped by the outcome of the MPC meeting and the commencement of the Q2/H1 earnings season, with corporate earnings likely to drive stock-specific positioning. Nonetheless, we believe attractive entry points across select fundamentally sound stocks will continue to support bargain-hunting activity. However, elevated Treasury bill yields are expected to remain a key competing destination for investor capital, potentially tempering the pace of inflows into the equities market.
Money Market and Fixed Income
Money Market
The OVN rate contracted by 10bps w/w to 22.1%, despite liquidity pressures from OMO PMA debits (NGN3.70 trillion) and net NTB allotments (NGN1.19 trillion) offsetting inflows from OMO maturities (NGN2.97 trillion). Nonetheless, following increased placements at the CBN SDF window, which averaged NGN4.54 trillion (prior week: NGN3.52 trillion), average system liquidity strengthened to a net long position of NGN4.44 trillion, from NGN4.10 trillion in the previous week.
Barring any mop-up activity by the CBN, system liquidity is expected to remain robust, buoyed by inflows from OMO maturities (NGN805.58 billion) and FGN bond coupons (NGN206.97 billion).
Treasury Bills
The Treasury bills secondary market traded on a bullish note, with average yields across all instruments contracting by 19bps to 19.5%. By segment, average yield in the NTB secondary market contracted by 11bps to 18.4%, as unmet auction demand trickled into the secondary market. Similarly, the average yield in the OMO secondary market fell by 8bps to 21.5% following continued offshore interest. At Wednesday’s NTB auction, the DMO offered NGN600.00 billion across tenors, with total demand reaching NGN3.03 trillion. Ultimately, the DMO allotted NGN1.19 trillion. Stop rates contracted by 4bps to 17.66% for the 364-day tenor, while the 91-day and 182-day tenors remained unchanged at 16.30% and 16.50%, respectively. Elsewhere, the CBN conducted two OMO PMAs during the week as part of its liquidity management operations. At Monday’s auction, the CBN offered NGN600.00 billion across tenors, with total subscriptions reaching NGN2.55 trillion, all of which was allotted. Stop rates settled at 21.89%, 20.49%, and 20.17% for the 8-, 99-, and 127-day tenors, respectively. At Tuesday’s auction, the CBN again offered NGN600.00 billion, attracting total subscriptions of NGN1.15 trillion, which were fully allotted. Stop rates settled at 21.90%, 20.79%, 20.18%, and 20.15% for the 7-, 70-, 126-, and 133-day tenors, respectively.
In the coming week, we expect money market activities to be largely shaped by the outcome of the MPC meeting on Tuesday, as investors assess the implications of the Committee’s decision for short-term rates and yields. Meanwhile, system liquidity is expected to remain robust, which should sustain demand for bills and potentially drive further moderation in secondary market yields.
Bonds
The FGN bond secondary market traded on a bullish note, contracting by 2bps to 17.6%. Across the benchmark curve, the average yield contracted at the short (-17bps) and mid (-3bps) segments due to demand for the MAR-2027 (-42bps) and APR-2029 (-16bps) bonds , respectively, while it expanded at the long (+13bps) end due to selloffs of the MAR-2050 (+52bps) bond.
Similarly, we expect the near-term direction of bond yields to be largely shaped by the outcome of next week’s MPC meeting. Over the medium term, however, we expect yields to remain relatively elevated, underpinned by the government’s sizeable borrowing requirements and persistent risk-off sentiment, particularly among offshore investors.
Foreign Exchange
The naira depreciated by 0.4% w/w to NGN1,385.00/USD, as increasing demand pressures undermined the CBN’s USD350.00 million intervention. Meanwhile, gross external reserves increased by USD146.50 million to USD51.92 billion (17 July 2026), marking its tenth consecutive week of growth. In the forwards market, the naira rates depreciated across the 1-month (-0.2% to NGN1,403.74/USD), 3-month (-0.2% to NGN1,442.88/USD), 6-month (-0.2% to NGN1,499.19/USD) and 1-year (-0.1% to NGN1,611.34/USD) contracts.
The naira is likely to face moderate near-term pressure from increased FX demand following Dangote Refinery’s shift to US dollar-denominated fuel sales. Nonetheless, depreciation is expected to remain contained, supported by resilient foreign portfolio investment (FPI) and local inflows, alongside measured CBN interventions.