September 1, 2026/CSL Report
August 2026 in retrospect
- The equities market declined in August, falling 1.6% month-on-month (m/m) to close at 241,298.47 points, following a 6.9% m/m gain in July. Consequently, the year-to-date (YTD) return of the market moderated to approximately 55.1% in August from 57.6% in July. The decline recorded in August was largely driven by broad-based profit-taking and weaker investor sentiment, with the Insurance and Consumer Goods sectors recording notable drops of 10.0% and 8.9% m/m, respectively. In contrast, the Banking sector remained relatively resilient, gaining 0.7% m/m, supported by gains in ACCESSCORP (+12.2%), FIRSTHOLDCO (+11.9%), and UBA (+3.1%).
- Market breadth weakened significantly in August, falling to 0.22x from 2.06x in July, signalling a sharp deterioration in underlying investor sentiment. This was due to the number of decliners rising to 88 compared to 35 the prior month, while the number of advancers significantly fell to 19 against 72 in July.
- Trading activity strengthened in volume terms during the period, while value traded moderated. Average daily volume increased by 70.5% m/m to 1.3 billion units, reflecting heightened activity. Conversely, average daily value traded declined by 37.3% m/m to around ₦32.3 billion.
- Overall, trading activities in August were characterised by broad-based profit-taking post H1 2026 earnings release rally, which was subsequently fuelled by the apex banks’ pronouncement of lifting previous restrictions to allow individuals, corporate bodies, and non-bank financial institutions to participate in primary and secondary OMO markets through Deposit Money Banks (DMBs); partly leading investors to seek improved yields in the debt market.
September 2026 market prospects
- The local bourse is expected to remain cautiously positive in September, supported by Nigeria’s re-entry into the FTSE Russell Frontier Market Index, effective 21 September. The reclassification should improve Nigeria’s visibility among global investors and could support renewed foreign portfolio participation and market liquidity. We reiterate our view that constituents that made up the index prior to its removal including DANGCEM, GTCO, MTNN, NESTLE, SEPLAT, and ZENITHBANK could benefit from the re-inclusion (see CSL Flash Note: “ FTSE Russell confirms the return of Nigeria to frontier-market status”, 31 August).
- Following the broad-based profit-taking in August, we expect selective buying interest to emerge across fundamentally strong counters, as the recent correction provides more attractive entry points. Investors are likely to cherry-pick stocks with compelling valuations, resilient earnings growth, strong balance sheets and attractive dividend prospects, rather than adopt a broad-based buying approach. This should also encourage further rotation across sectors and individual stocks.
- Overall, we expect investors to maintain a cautiously bullish bias in September, supported by the FTSE Russell reclassification and renewed buying opportunities following the August price corrections. This is in addition to the likely coming to market of the Dangote Refinery Limited IPO in the month, which could further improve short term positive sentiments on the NGX.
September 2026 Top 10 Stock Picks
Click here to download full report: CSL Nigeria Monthly Stock Picks-September 2026