The Nigerian equities market traded on bullish note, as sustained buying interest across large-cap tickers lifted the benchmark index. Notably, strong gains in BUACEMENT (+17.6%), FIRSTHOLDCO (+25.6%), MTNN (+2.8%), ZENITHBANK (+11.0%), and HBMNG (+4.3%) drove the All-Share Index higher by 1.6% w/w to close at 247,357.41 points.
July 24, 2026/Cordros Report
Global
According to the Office for National Statistics (ONS), UK headline inflation eased at its slowest pace since March 2025, printing 2.6% y/y in June (May: 2.8% y/y), and slightly below market expectations of 2.7% y/y. The moderation was primarily driven by softer food inflation and lower energy price pressures, following the brief de-escalation of the US-Iran conflict. Specifically, food inflation slowed by 50bps to 1.7% y/y in June (May: +2.2% y/y), its lowest level since August 2024, reflecting lower prices for sugar, jam, syrups, chocolate, and confectionery. Likewise, services inflation moderated to +3.6% y/y (May: +3.7% y/y) driven by slower price increases in public transport service and personal transport equipment. Core inflation, which excludes volatile food and energy components, was unchanged at +2.6% y/y in June (May: +2.6% y/y), suggesting underlying price pressures remain broadly contained. On a month-on-month basis, consumer prices moderated to +0.1% in June (May: +0.2% m/m), reflecting lower energy costs. Although the new UK government under Prime Minister Andy Burnham has implemented tax cuts to combat the cost-of-living crisis, we believe the inflationary impact of the renewed Middle East conflict on oil prices and energy costs is likely to offset the benefits from these fiscal reforms. Against this backdrop, we expect the MPC to hold rates at its July 30 meeting, as it continues to assess the impact of the war on domestic price pressures.
At its July 2026 policy meeting, the Governing Council of the European Central Bank (ECB) voted to keep its policy rate unchanged, noting that the outlook remains volatile due to the ongoing Middle East war. Specifically, deposit facility, main refinancing operations, and marginal lending facility rates were maintained at 2.25%, 2.40% and 2.65%, respectively. The Council also noted that the full inflationary effects of the energy shock have yet to materialise, reflecting the continued softness in the labour market. Accordingly, the Council stated that it will continue to monitor the intensity and duration of the shock, as well as its indirect and second-round effects. Looking ahead, the ECB is likely to hold with a hawkish bias as renewed conflict in the Middle East has diminished prospects for a near term moderation in energy costs. As a result, inflation risks remain tilted to the upside, with the pass-through from elevated input costs to food and core prices still under way. Nonetheless, the Council reiterated its data-dependent approach. Accordingly, we expect the policy rate to remain unchanged at the next meeting, while leaving room for further tightening if inflationary pressures intensify.
Global Markets
Global equities traded choppily this week, as an escalation in the Middle East conflict lifted Brent crude above USD100.00/bbl, reviving concerns around global inflation and the interest rate trajectory, while renewed scrutiny over the scale of AI capital spending weighed on technology names. Market participants also assessed a fresh batch of Q2 earnings releases and a new round of US tariffs. At the time of writing, major US indices (DJIA: -0.8%; S&P 500: -0.7%; NASDAQ: -1.5%) were poised to close the week lower, weighed down by heavy losses across megacap technology names following Alphabet’s upwardly revised capital expenditure guidance and a weaker-than-expected earnings print from Tesla. Meanwhile, the European market was mixed, as the FTSE 100 (+0.4%) advanced, supported by gains in energy names tracking the rally in crude prices, while the STOXX Europe 600 (-0.4%) declined, pressured by weakness in technology stocks. Elsewhere, Asian markets (SSE: +1.2%; Nikkei 225: +0.7%) advanced, as Chinese equities gained on a domestic model release by Moonshot AI that matched US systems on key benchmarks, while Japanese equities were supported by a mid-week rebound in semiconductor names. Finally, the Emerging Market (MSCI EM: +3.2%) index advanced, supported by gains in China (+1.2%, while the Frontier Market (MSCI FM: -1.5%) index declined, reflecting losses in Vietnam (-5.6%).
Domestic Economy
At its 306th Monetary Policy Committee (MPC) meeting held in July, the Central Bank of Nigeria (CBN) maintained the Monetary Policy Rate (MPR) at 26.50%, marking the third consecutive policy meeting at which the benchmark rate was left unchanged. The Committee’s decision was underpinned by a comprehensive assessment of the balance of risks. Although headline inflation moderated marginally in June 2026, heightened global uncertainties, driven primarily by renewed hostilities in the Middle East, continued to pose upside risks to inflation. The Committee also retained all other parameters, including the asymmetric corridor around the MPR at +50bps/-450bps, and the Cash Reserve Requirement (CRR) for Deposit Money Banks (DMBs) and Merchant Banks at 45.0% and 16.0%, respectively. Also, the non-Treasury Single Account (TSA) public sector deposits CRR was maintained at 75.0% and liquidity ratio was left unchanged at 30.0%. Looking ahead, we expect the MPC to remain cautious primarily due to elevated inflation risks, ongoing geopolitical tensions, tight global financial conditions and the need to sustain foreign portfolio inflows. Accordingly, barring any material shocks, we expect the MPC to hold the MPR at 26.50% at its next meeting.
According to data from the Central Bank of Nigeria (CBN), Credit to the Private Sector (CPS) increased by 2.7% m/m to NGN83.26 trillion in June (May: NGN81.04 trillion). The moderate pace of growth reflects the impact of the CBN’s still tight monetary policy stance, as elevated interest rates continued to constrain credit demand and lending activity. At the same time, credit to the government declined moderately by 0.9% m/m to NGN40.03 trillion (May: NGN40.38 trillion), despite increased government borrowing from domestic banks to finance the deficit. Currency in circulation declined by 2.9% m/m but remained high at NGN5.52 trillion (May: NGN5.69 trillion), underscoring the continued importance of cash transactions, particularly within Nigeria’s informal sector. Overall, broad money supply (M3) rose by 3.1% m/m to NGN133.25 trillion (May: NGN129.21 trillion), reflecting increases in both quasi money (+4.7% m/m) and narrow money (+0.2% m/m). On a year-on-year basis, the credit to private sector rose by 9.4% (NGN83.26 trillion vs June 2025: NGN76.13 trillion). In the near term, growth in credit to the private sector is expected to remain subdued amid the elevated interest rate environment. The MPC’s July decision to hold rates at current levels is likely to sustain tight financing conditions, limiting access to credit for businesses and weighing on private sector investment.
Capital Markets
Equities
The Nigerian equities market traded on bullish note, as sustained buying interest across large-cap tickers lifted the benchmark index. Notably, strong gains in BUACEMENT (+17.6%), FIRSTHOLDCO (+25.6%), MTNN (+2.8%), ZENITHBANK (+11.0%), and HBMNG (+4.3%) drove the All-Share Index higher by 1.6% w/w to close at 247,357.41 points. As a result, month-to-date and year-to-date returns settled higher at +7.8% and +59.0%, respectively. Market participation also improved, with total trading volume and value increasing by 53.1% w/w and 64.8% w/w, respectively. Meanwhile, sectoral performance was mixed, as the Banking (+8.3%), Industrial Goods (+5.0%), Insurance (+3.9%), and Oil & Gas (+0.1%) indices closed higher, while the Consumer Goods index (-3.8%) was the sole loser for the week.
Looking ahead, we expect market activity to be shaped by ongoing H1-26 corporate earnings releases and interim dividend declarations, likely driving stock-specific positioning across select counters.
Money Market and Fixed Income
Money Market
The OVN rate stayed anchored at 22.2% as inflows from OMO maturities (NGN1.78 trillion) and FAAC disbursements (NGN1.50 trillion) offset CRR (NGN2.60 trillion) and FGN Bond PMA (NGN931.82 billion) debits. Consequently, average system liquidity moderated to a net long position of NGN3.51 trillion, down from NGN4.44 trillion in the previous week.
In the absence of any liquidity management measures by the CBN, we expect system liquidity to remain strong, supported by inflows from OMO maturities (NGN1.11 trillion) and FGN bond coupon payments (NGN241.14 billion).
Treasury Bills
The Treasury bills secondary market traded on a bullish note as the average yield across all instruments contracted by 17bps to 19.4% due to the absence of primary market issuances during the week, which redirected investor demand to the secondary market. By segment, average yield in the NTB and OMO secondary markets both contracted by 13bps to 18.3% and 21.4%, respectively.
Next week, we expect the Treasury bills secondary market to trade on a mixed note as investor attention shifts to the CBN’s primary market auction on Wednesday (29 July), where NGN700.00 billion in bills will be offered. At the auction, we expect strong investor demand to exert downward pressure on stop rates.
Bonds
The FGN Bond secondary market traded on a bullish note, contracting by 24bps to 17.4% as unmet auction demand filtered into the secondary market. Across the benchmark curve, the average yield contracted at the short (-4bps), mid (-33bps) and long (-17bps) segments due to demand for the MAR-2027 (-25bps), MAR-2036 (-56bps) and JUN-2038 (-62bps) bonds, respectively. At Monday’s FGN Bond auction, the DMO reopened the JAN-2035, APR-2037 and JUN-2038 bonds, offering a total of NGN1.20 trillion. Total demand settled at NGN1.74 trillion, with the DMO eventually allotting NGN931.82 billion. The stop rates on the JAN-2035 and APR-2037 bonds, which were on-the-run at the previous auction, remained unchanged at 18.34% and 18.35%, respectively, while the JUN-2038 bond settled at 18.40%.
Over the medium term, we expect yields to remain relatively elevated, underpinned by the government’s sizeable borrowing requirements. However, the gradually improving offshore and local demand could provide some near term support.
Foreign Exchange
The naira appreciated by 1.6% w/w to NGN1,362.32/USD, as FPI inflows offset local demand pressure. Meanwhile, gross external reserves increased by USD87.40 million to USD52.03 billion (23 July 2026), marking the eleventh consecutive week of reserve accretion. In the forwards market, the naira rates appreciated across the 1-month (+1.0% to NGN1,389.15/USD), 3-month (+1.3% to NGN1,424.05/USD), 6-month (+1.1% to NGN1,483.45/USD) and 1-year (+1.2% to NGN1,592.28/USD) contracts.
We expect the naira to remain broadly stable in the near term, underpinned by resilient portfolio inflows, strong investor confidence, and widening current account surplus.