August 10, 2026/United Capital Update
Global Markets
United States
The United States Institute for Supply Management (ISM) Services Purchasing Managers’ Index (PMI) edged up to 54.1 Points in July 2026 from 54.0 Points in June, indicating continued expansion in the services sector despite falling short of market expectations. Business activity accelerated to 59.1 Points from 55.4 Points, while new orders increased to 57.2 Points from 55.1 Points, reflecting sustained demand for services. Inventory growth also strengthened, although employment fell back into contraction at 47.4 Points after expanding in the previous month. Input cost pressures intensified, with the prices index rising to 70.3 Points from 67.7 Points, largely driven by higher petroleum-related products and plastics costs.
Euro Area
Euro Area Producer Price Inflation (PPI) eased to 4.6% year-on-year in June 2026 from 5.9% in May, in line with market expectations, indicating softer pipeline inflationary pressures. Meanwhile, the S&P Global Euro Area Composite Producers Manufacturing Index (PMI) was revised up to 52.0 Points in July 2026 from a preliminary estimate of 51.9 Points and 50.0 Points in June, marking the strongest expansion in business activity in eight months. The improvement reflected renewed growth in services, faster manufacturing output and the strongest increase in new business since November. Input cost and output price inflation eased further, while business confidence rose to a five-month high, signalling improved optimism at the start of the third quarter.
Asia
The RatingDog China General Composite PMI declined to 50.8 Points in July 2026 from 53.6 Points in June, marking its lowest level since July 2025 and indicating slower expansion in private sector activity. The slowdown reflected weaker momentum across the manufacturing and services sectors, while new business grew for a fourteenth consecutive month at its slowest pace since March. Employment increased for a third straight month, signalling continued hiring despite moderating business activity. Meanwhile, input costs and output charges rose at their slowest pace in six months, indicating easing inflationary pressures across both sectors.
Oil Markets
Crude oil prices declined during the week as easing geopolitical tensions and expectations of adequate global supply weighed on market sentiment. Brent crude fell 7.35% week-on-week to US$82.49/b as of August 06, while Bonny Light declined 4.00% to US$89.06/b as of August 05. Despite the decline, prices remained supported by supply risks and ongoing geopolitical developments.
Outlook
Global markets are expected to trade on a positive note this week as investors await July inflation data and assess the United States payrolls report. Market participants will monitor comments from United States Federal Reserve officials for signals on the interest rate outlook. United States Treasury yields are expected to remain sensitive to inflation data, while a stronger US Dollar could weigh on emerging market currencies. Gold prices may remain supported by easing geopolitical tensions, while global equities should benefit from corporate earnings and artificial intelligence-related investment announcements. China’s industrial production data will provide further insight into global demand and the outlook for commodity-exporting economies.
Domestic Economy
United Capital Research forecasts Nigeria’s headline inflation to ease to 15.35% in July 2026 from 15.91% in June, driven by softer food prices and continued declines in Premium Motor Spirit (PMS) prices. If realised, this would mark the second consecutive monthly decline in inflation. We expect inflation to remain within the 15% range between July and October 2026, supported by improving food supply as the harvest season gathers pace. Recent increases in tomato and yam prices largely reflect seasonal supply constraints associated with the onset of the rainy season and are expected to ease as harvests improve. The anticipated moderation in inflation should support lower fixed income yields in the short term, creating opportunities for investors to lock in current yields ahead of an expected rally in the fixed income market.
Equity Market
The Nigerian equities market closed the week on a positive note, with the NGX All-Share Index (NGX-ASI) rising 0.12% week-on-week to 245,573.60 points. Consequently, the year-to-date return improved to 57.81%. Sectoral performance was mixed, as the Banking Index gained 2.33%. However, the Insurance, Consumer Goods, Industrial Goods and Oil & Gas indices declined 3.31%, 1.75%, 0.17% and 0.03%, respectively.
Fixed Income and Money Market
The fixed income market traded mixed during the week as Nigerian Treasury Bill (NTB) and bond yields moved in opposite directions across tenors. In the NTB market, the 91-day and 182-day yields increased by 0.41% and 0.55% to 17.10% and 18.46%, respectively, while the 364-day yield declined by 0.11% to 20.30%. Bond yields declined across all tenors, with the 3-year, 5-year, 7-year and 10-year yields falling by 0.42%, 0.27%, 0.29% and 0.18% to 17.01%, 17.12%, 17.11% and 17.21%, respectively. Meanwhile, the Overnight (O/N) rate declined by 0.25% to 22.10%, while the Open Repo Rate (OPR) remained unchanged at 22.00%.
Outlook:
Equity Market
The Nigerian equities market is expected to trade on a positive note this week, supported by continued interest in banking stocks. Nevertheless there maybe some profit taking in some stocks. Mid-cap and small-cap stocks may remain active as investors respond to recent listings and corporate developments. Corporate earnings releases are expected to influence market direction, while Naira liquidity conditions could shape overall investor sentiment.
Fixed Income Market
The fixed income market is expected to remain stable, with investors monitoring secondary market yields following the recent Nigerian Treasury Bills (NTBs) auction. Treasury Bills yields are expected to remain elevated, supported by strong institutional demand and the CBN’s liquidity management operations. Interbank liquidity conditions are expected to remain tight, keeping funding costs around current levels. The FGN bond market should record steady secondary market activity as investors position ahead of the next primary auction. Eurobond prices will remain sensitive to changes in investor sentiment and Nigeria’s sovereign risk outlook.