The Nigerian equities market closed the week on a positive note, supported by a late-week rally following FTSE Russell’s announcement that Nigeria will be reclassified to Frontier Market status, effective September 21, 2026. Precisely, gains in FIRSTHOLDCO (+11.6%), SEPLAT (+10.0%) and ACCESSCORP (+9.3%) drove the All-Share Index higher by 0.8% w/w to 241,298.47 points.
August 28, 2026/Cordros Report
Global
Based on the data obtained from the Bureau of Economic Analysis (BEA), the United States Personal Consumption Expenditures (PCE) index held steady at 3.7% y/y in July (June: +3.7% y/y), above the market expectations of 3.6% y/y. The unchanged headline reading reflected broadly stable goods and services inflation. Goods prices remained unchanged at 3.7% y/y in July (June: +3.7% y/y), as higher durable goods inflation (+3.9% y/y vs June: +3.7% y/y) inflation, offset the modest increase in non-durable goods inflation (+3.4% y/y vs June: +2.9% y/y). Similarly, services inflation remained unchanged at 3.7% y/y (June: +3.7% y/y), indicating continued persistence in services price pressures. Excluding food and energy, core PCE inflation remained unchanged at 3.3% y/y (June: +3.3% y/y), signalling that underlying price pressures remain persistent. On a monthly basis, PCE inflation rose by 0.2% in July, following a 0.1% m/m decline in June. Looking ahead, inflation risks remain skewed to the upside, as elevated energy prices could generate second round effects across goods and services prices amid the ongoing US-Iran conflict. Trade induced pressures following the recently announced tariffs on Canadian goods could also add to the inflationary pressures. Against this backdrop, we expect the Fed to maintain a cautious stance as it assesses the impact of geopolitical and trade related shocks on prices. This view broadly aligns with market expectations. The CME FedWatch Tool currently assigns a 64.1% probability to the Fed holding rates its 16 September meeting.
According to the United States Department of Labour, initial jobless claims declined by 4,000 to 203,000 in the week ended August 22, below market expectations of 208,000. The reading is consistent with the broadly stable labour market conditions and extends the recent period of subdued claims and limited layoffs. On a non-seasonally adjusted basis, the largest declines were recorded in California (-800), New Jersey (-752) and Florida (-647), while the largest increases occurred in New York (+722), Illinois (+700) and Michigan (+305). Meanwhile, the four-week moving average rose by 1,250 to 205,500 from 204,250 in the prior week. Looking ahead, we expect initial jobless claims to remain relatively low, consistent with limited layoffs and broadly resilient labour market resilience. However, the modest uptick in the four-week moving average may indicate some moderation in labour market momentum, although conditions have not deteriorated materially.
Global Market
Global equities traded on a broadly positive note this week, as a rebound in technology and AI-linked names lifted sentiment across major markets, while a retreat in global bond yields provided further support, easing pressure on equity valuations. Market participants also assessed a fresh batch of macroeconomic data, including the July core PCE price index and a second reading of US Q2-26 GDP. At the time of writing, major US indices (DJIA: +0.6%; S&P 500: +0.7%; NASDAQ: +1.4%) were poised to close the week higher, supported by a rebound in technology names following Nvidia’s better-than-expected results and forward guidance, ahead of Fed Chair Kevin Warsh’s inaugural Jackson Hole address. Meanwhile, European equities were mixed, as the STOXX Europe 600 (+0.1%) edged higher on the technology rebound, while the FTSE 100 (0.0%) closed flat. Elsewhere, Asian markets (SSE: +1.2%; Nikkei 225: +0.9%) advanced, as Chinese equities gained on strength in technology names, while Japanese equities rose modestly, tracking the broader rebound in technology names. Finally, the Emerging Market (MSCI EM: -1.6%) index declined, dragged by losses in India (-0.8%) and South Korea (-1.1%), while the Frontier Market (MSCI FM: +1.3%) index advanced, supported by gains in Vietnam (+3.6%) and Iceland (+1.5%).
Domestic Economy
Based on the data from the Domestic and Foreign Portfolio Report of the Nigerian Exchange (NGX), total transactions in the Nigerian equities market rose by 38.2% m/m to an all-time high of NGN2.37 trillion in July (June: NGN1.71 trillion). The increase was driven primarily by domestic investors, who accounted for 94.4% of gross transactions. Domestic investor transactions increased by 46.4% m/m to NGN2.24 trillion (June: NGN1.53 trillion), reflecting higher activity from both institutional (+66.2% m/m) and retail (+9.4% m/m) investors. At the same time, transactions from foreign investors declined by 29.0% m/m to NGN132.62 billion (June: NGN186.79 billion). Overall, the market recorded net inflows of NGN24.95 billion, reversing the prior month’s net outflows of NGN48.99 billion. The outturn was driven mainly by net domestic inflows (NGN74.39 billion), which completely offset the net foreign outflows (NGN49.44 billion). Looking ahead, we expect domestic investors to remain the primary drivers of market turnover. Nevertheless, elevated fixed income yields are likely to inhibit portfolio reallocation towards equities, as attractive yields continue to compete for domestic capital. Moreover, a cautious monetary policy stance should keep interest rates elevated, limiting risk appetite and tempering near term inflows into the equity market.
According to the data from the Central Bank of Nigeria (CBN), total sectoral FX utilisation rose by 61.9% y/y to USD34.59 billion in H1-26 (H1-25: USD21.37 billion), its highest level in the 2010-2026 record. The increase was driven by a substantial rise in invisible import utilisation, even as visible imports utilisation declined. Invisible import utilisation, which accounted for 71.2% of gross utilisation, surged by 117.2% y/y to USD24.63 billion (H1-25: USD11.34 billion). The increase was driven primarily by higher utilisation in Financial Services (+97.0% y/y to USD19.16 billion vs H1-25: USD9.72 billion), and Business Services (+263.7% y/y to USD2.89 billion vs H1-25: USD749.00 million). On the other hand, visible import utilisation declined slightly by 0.7% y/y to USD9.96 billion in H1-26 (H1-25: USD10.03 billion). The decline is driven primarily by lower utilisation in the industrial sector (-21.2% y/y to USD3.72 billion vs H1-25: USD4.72 billion) and oil sector (-18.7% y/y to USD2.15 billion vs H1-25: USD2.64 billion). Looking ahead, we expect visible imports to remain constrained, partly reflecting lower refined petroleum products import as domestic refining activity expands. We also expect FX liquidity conditions to remain broadly stable in the near term, supported by improving macroeconomic conditions and continued CBN measures to support FX market liquidity. This should provide greater scope for increased FX utilisation across sectors.
Capital Markets
Equities
The Nigerian equities market closed the week on a positive note, supported by a late-week rally following FTSE Russell’s announcement that Nigeria will be reclassified to Frontier Market status, effective September 21, 2026. Precisely, gains in FIRSTHOLDCO (+11.6%), SEPLAT (+10.0%) and ACCESSCORP (+9.3%) drove the All-Share Index higher by 0.8% w/w to 241,298.47 points. As a result, the month-to-date return moderated to -1.6%, while the year-to-date return settled at +55.1%. On market activity, trading volume and value declined by 49.1% w/w and 6.8% w/w, respectively. Sectoral performance was mixed, as the Oil & Gas (+4.5%) and Banking (+2.9%) indices closed higher, while the Consumer Goods (-0.7%) and Insurance (-0.6%) indices closed lower. The Industrial Goods index closed flat.
Next week, we expect positive sentiment towards risk assets to persist, following FTSE Russell’s confirmation that Nigeria remains on track for reinclusion in the Frontier Market Index. Nonetheless, elevated fixed-income yields may continue to compete for investors’ capital and temper the pace of gains.
Money Market and Fixed Income
Money Market
The OVN rate expanded by 8bps w/w to 22.2% as OMO (NGN4.72 trillion) and net NTB (NGN333.65 billion) PMA debits offset inflows from OMO maturities (NGN2.32 trillion). Nonetheless, system liquidity remained bolstered as average SDF placements increased to NGN4.77 trillion during the week, from NGN3.52 trillion previously. Consequently, average system liquidity rose to a net long position of NGN4.26 trillion, up from NGN3.95 trillion in the previous week.
Barring CBN intervention, system liquidity should remain supportive next week, supported by NGN2.25 trillion in OMO maturities. However, additional OMO issuances could absorb part of the surplus, keeping money market rates broadly around current levels, with more aggressive sterilization posing upside risks to rates.
Treasury Bills
The Treasury bills secondary market traded on a bearish note as the average yield across all instruments expanded by 10bps to 19.3%. By segment, average NTB secondary market yields expanded by 35bps to 18.9%, as investors unwound positions and redirected flows into Wednesday’s NTB PMA. In contrast, average OMO secondary market yields contracted by 44bps to 20.4%, as excess OMO PMA bids filtered into the secondary market. At Wednesday’s NTB PMA, the DMO offered NGN700.00 billion across the three tenors, attracting total demand of NGN3.79 trillion. The DMO ultimately allotted NGN762.89 billion. Stop rates declined by 44bps to 17.15% for the 364-day tenor, while rates on the 91-day and 182-day bills remained unchanged at 16.30% and 16.50%, respectively. The CBN also conducted two OMO PMAs during the week. At the first auction on Wednesday, it offered NGN600.00 billion in bills, attracting NGN4.26 trillion in demand, and ultimately allotted NGN2.80 trillion. Stop rates settled at 19.90% and 19.65% for the 97- and 132-day tenors, respectively. At Thursday’s auction, the CBN offered a further NGN500.00 billion, with demand rising to NGN4.36 trillion and total allotment reaching NGN1.93 trillion. Stop rates closed at 19.85% for the 96-day tenor and 19.32% for the 152-day tenor.
Next week, we expect the Treasury bills secondary market to maintain a bullish bias, supported by resilient domestic demand and ample system liquidity. However, NTB yield movements may remain choppy with intermittent upward pressure as OMO yields remain more attractive to investors. On the supply side, the DMO is scheduled to offer NGN700.00 billion in Treasury bills at its primary auction on Wednesday, 02 September.
Bonds
The FGN bond secondary market traded on a bearish note, with a bearish undertone, as the average yield across instruments expanded by 2bps to 16.8% as investors maintained a cautious tone in the face of two OMO auctions during the week. Across the benchmark curve, the average yield contracted at the mid (-3bps) and long (-1bp) segments due to demand for the APR-2029 (-20bps) and JUN-2038 (-4bps) bonds, respectively. Meanwhile, average yields expanded at the short (+22bps) end due to selloffs of the MAR-2027 (+181bps).
Over the medium term, we expect yields to remain elevated, reflecting the government’s sizeable borrowing requirements, although improving offshore and local demand should provide some support in the near term.
Foreign Exchange
The naira appreciated by 0.7% w/w to NGN1,338.01/USD buoyed by offshore supply stemming from participation in the week’s OMO auction. Meanwhile, gross external reserves increased by USD478.45 million to USD53.31 billion (27 August 2026). In the forwards market, the naira appreciated across the 1-month (+0.6% to NGN1,361.59USD), 3-month (+0.6% to NGN1,451.27/USD), 6-month (+0.6% to NGN1,451.27/USD) and 1-year (+0.6% to NGN1,556.72/USD) contracts.
We expect the naira to trade within a broadly stable range around its current level in the near term, supported by resilient portfolio inflows, relatively firm investor sentiment and a widening current account surplus. However, a renewed decline in oil-related FX inflows remains the key downside risk to this outlook.