The domestic equities market sustained its positive momentum this week. The performance was supported by renewed buying interest in SEPLAT (+7.3%), DANGCEM (+1.6%), HBMNG (+4.4%), GTCO (+5.4%) and ZENITHBANK (+5.1%). Consequently, the All-Share Index advanced by 0.9% w/w to 252,113.41 points
September 25, 2026/Cordros Report
Global
According to the latest data from S&P Global, the US Composite Purchasing Managers’ Index (PMI) rose for the fourth consecutive month to 58.4 points in September (August: 56.0 points), pointing to the strongest expansion in private sector activity since July 2021. The acceleration was driven by broad-based expansion across the manufacturing and services sectors. More specifically, the services PMI rose to 58.7 points in September (August: 56.5 points), signaling the strongest expansion in services activity in more than five years. The outturn reflected stronger new orders, supported by resilient domestic demand, which more than offset lower export orders amid continued tariff uncertainty. Meanwhile, the manufacturing PMI rose to 56.7 points in September (August: 53.1 points), supported by stronger production, new orders and inventory accumulation. The labour market also remained resilient, with employment rising at one of the fastest rates since comparable data began in 2009. The increase reflected stronger hiring as firms worked through backlogs in both manufacturing and services sectors. However, price pressures intensified, with input costs rising at their fastest pace since October 2022, mainly due to higher fuel and transport costs. Looking ahead, we expect US private sector activity to remain strong, supported by resilient domestic demand and elevated backlogs. These factors should sustain output and hiring in the coming months, while improving confidence among manufacturers points to further expansion. However, higher living and borrowing costs, alongside rising input prices, could moderate the pace of growth, particularly in the services sector.
According to the latest data from S&P Global, the UK Composite PMI eased to 51.7 points in September from 52.5 points in August, falling short of the market expectations of 52.0 points. The moderation reflected slower output expansion in both services and manufacturing activity. Specifically, the services PMI fell to 51.7 points (August: 52.5 points), as weaker new business and softer activity among financial firms weighed on the sector, despite continued strength in technology services. Likewise, the manufacturing PMI eased to 51.4 points in September (August: 52.1 points), primarily reflecting weaker new orders, while employment fell for a 24th consecutive month, as high costs and subdued confidence restrained hiring. Price pressures also intensified, with higher energy, fuel and labour costs lifting input price inflation to a three-month high. Looking ahead, we expect UK private sector activity to continue expanding modestly, supported by growth in technology services and recovering manufacturing demand. However, weak new orders and cautious hiring suggest that momentum will remain subdued, while elevated energy costs and uncertainty surrounding domestic policy and the Middle East conflict could further weigh on spending and investment.
Global Markets
Global equities traded with mixed sentiment this week, as a rebound in technology and AI-linked names and easing oil prices were offset by rising global bond yields and hawkish US Fed commentary. Brent crude retreated on reports that the US and Iran were nearing an agreement to restore tanker flows through the Strait of Hormuz, easing concerns over renewed energy-driven inflationary pressures. At the time of writing, major US indices (DJIA: -0.6%; S&P 500: +0.7%; NASDAQ: +1.6%) were mixed, as the NASDAQ and S&P 500 advanced on a rally in semiconductor and AI-linked names, including Intel, AMD and Meta, while the DJIA edged lower as gains remained concentrated in technology. Meanwhile, European equities (STOXX Europe 600: +0.2%; FTSE 100: +0.2%) edged higher, supported by gains in technology names, though the advance was capped by rising bond yields. Elsewhere, Asian markets were mixed, as Japanese equities (Nikkei 225: +2.1%) advanced on sustained momentum in AI and technology names, while Chinese equities (SSE: -0.6%) declined on higher bond yields, as President Xi’s US state visit and a US-China trade truce extension failed to lift sentiment. Finally, the Emerging Market (MSCI EM: +1.2%) index advanced on gains in South Korea (+2.7%) and Taiwan (+1.8%), while the Frontier Market (MSCI FM: -1.5%) index declined on losses in Romania (-4.4%).
Domestic Economy
At its 307th Monetary Policy Committee (MPC) meeting in September, the Central Bank of Nigeria (CBN) reduced the Monetary Policy Rate (MPR) by 350bps to 23.00%, following three consecutive MPC meetings at which the benchmark interest rate was left unchanged. The decision formed part of an operational realignment aimed at strengthening monetary policy transmission and restoring the MPR’s role as the primary policy signal. The Committee also noted that moderating inflation, resilient economic growth and relative exchange rate stability provided scope for the policy adjustment. The Committee also adjusted the asymmetric corridor around the MPR to +50/–300bps (previous: +50/–450bps). At the same time, the Committee maintained all other policy parameters. The CRR was kept at 45.0% for Deposit Money Banks (DMBs), 16.0% for Merchant Banks, and 75.0% for non-Treasury Single Account (TSA) public sector deposits, while the liquidity ratio remained unchanged at 30.0%. Looking ahead, we expect limited scope for additional policy easing, given the MPC’s cautious tone, elevated global interest rates, and the likelihood of a slower disinflation towards the end of the year. Further rate reductions could narrow the interest rate differential with advanced economies, weaken the attractiveness of naira-denominated assets and increase the risk of weaker foreign portfolio inflows and exchange rate pressure.
According to data from the Central Bank of Nigeria (CBN), credit to the private sector (CPS) increased by 1.3% m/m to NGN84.55 trillion in August (July: NGN83.42 trillion). While credit expanded, the modest monthly growth likely reflects the impact of the CBN’s tight monetary policy stance, as elevated interest rates continued to constrain credit demand and lending activity. At the same time, credit to government declined by 3.6% m/m to NGN32.69 trillion (July: NGN33.92 trillion), despite continued government borrowing from domestic banks to finance the deficit, given that the reported figure is a net position. Alos, currency in circulation increased by 1.0% m/m to NGN5.43 trillion (July: NGN5.38 trillion). Overall, broad money supply (M3) rose moderately by 0.4% m/m to NGN139.38 trillion (July: NGN138.77 trillion), reflecting a +1.1% m/m increase in quasi money, which more than offset a 1.0% m/m decline in narrow money. On a year-on-year basis, credit to the private sector rose by 11.4% from NGN75.88 trillion in August 2025. In the near term, growth in credit to the private sector could improve following the MPR recalibration, although the transmission in lending rates is likely to be gradual. The MPC’s decision to cut the policy rate should ease financing conditions at the margin, while improving the availability and affordability of credit for some businesses. This could support a gradual recovery in private sector investment.
Capital Markets
Equities
The domestic equities market sustained its positive momentum this week. The performance was supported by renewed buying interest in SEPLAT (+7.3%), DANGCEM (+1.6%), HBMNG (+4.4%), GTCO (+5.4%) and ZENITHBANK (+5.1%). Consequently, the All-Share Index advanced by 0.9% w/w to 252,113.41 points, bringing the month-to-date and year-to-date returns to +3.2% and +62.0%, respectively. On market activity, total volume and value traded increased by 45.0% w/w and 1.6% w/w, respectively. Sectoral performance was broadly in line with the overall market sentiment, as the Oil & Gas (+3.5%), Banking (+3.1%), Industrial Goods (+1.6%) and Consumer Goods (+0.6%) indices advanced, while the Insurance (-0.5%) index closed lower for the week.
Next week, we expect investor risk appetite to gradually improve as the recent 350bps rate cut supports further downward repricing of market yields, reducing the opportunity cost of holding equities. Meanwhile, investors’ focus is likely to remain on the stability of inflation and the exchange rate, which will be critical to sustaining confidence. Against this backdrop, we expect gradual portfolio repositioning ahead of the 9M-26 earnings season and Q4, with increased exposure to fundamentally strong equities offering robust earnings growth, attractive dividend attributes and greater sensitivity to lower interest rates.
Money Market and Fixed Income
Money Market
The OVN rate contracted by 147bps w/w to 20.8%, as higher average SDF flows (NGN5.75 trillion vs NGN2.82 trillion previously), following the Monetary Policy Committee’s (MPC) 350bps rate cut, alongside inflows from OMO (NGN2.27 trillion) maturities offset OMO (NGN2.25 trillion) and net NTB (NGN19.78 billion) PMA debits. Consequently, average system liquidity rose to a net long position of NGN5.85 trillion from NGN3.27 trillion in the previous week.
Looking ahead, we expect system liquidity to remain elevated, with banks’ excess liquidity likely to continue flowing into the SDF window, given the relative attractiveness of the 20.0% SDF rate compared with prevailing short-term yields. Additionally, OMO maturities totaling NGN1.09 trillion are expected to hit the system in the coming week and should provide an additional liquidity boost. However, we expect fresh OMO issuances to partly offset the inflow.
Treasury Bills
The Treasury bills secondary market traded on a bullish note, supported by sizable unmet demand from the week’s NTB and OMO primary market auctions, which extended into the secondary market. The MPC’s 350bps rate cut also supported further downward repricing of yields. Consequently, the average yield across all instruments contracted by 91bps to 18.2%. By segment, average NTB secondary market yields declined by 96bps to 17.9%, while average OMO secondary market yields fell by 45bps to 19.8%. At Wednesday’s NTB PMA, the DMO offered NGN600.00 billion across tenors, with total demand reaching NGN4.23 trillion. The DMO ultimately allotted NGN497.58 billion, equivalent to 0.83x the amount offered, with stop rates contracting by 80bps, 70bps and 73bps to 15.50%, 15.80% and 15.89% for the 91-, 182- and 364-day tenors, respectively. Similarly, at Thursday’s OMO PMA, the CBN offered NGN1.00 trillion in bills, attracting NGN6.09 trillion in demand, and ultimately allotting NGN2.25 trillion. Stop rates settled at 17.29% and 16.99% for the 152- and 180-day tenors, respectively.
We expect the Treasury bills secondary market to retain a broadly bullish bias, supported by ample system liquidity. With the recent MPC rate cut reinforcing expectations of further downward repricing in short-term yields, investors are likely to seek to lock in prevailing elevated yields, particularly at the longer end of the T-bill curve.
Bonds
Similarly, the FGN bond secondary market traded with a bullish tone, with average yields across instruments contracting by 85bps to 15.7%, supported by robust local and offshore demand and further downward repricing following the MPC’s 350bps rate cut. Across the benchmark curve, the average yield contracted at the short (-156bps), mid (-83bps) and long (-44bps) segments due to demand for the MAR-2027 (-269bps), JUN-2032 (-111bps) and JUN-2038 (-75bps) bonds, respectively.
In the near term, we expect resilient local demand, improving offshore participation and the recent MPC rate cut to sustain the bullish tone. Over the medium term, however, sizeable government borrowing requirements should keep yields relatively elevated, while the longer-term yield trajectory will remain contingent on monetary policy conditions, foreign inflows, domestic liquidity and the FGN’s funding needs.
Foreign Exchange
The naira appreciated by 0.1% w/w to NGN1,330.68/USD, as inflows for the week’s OMO auction and a CBN intervention of a USD200.00 million sale offset domestic demand. Meanwhile, gross external reserves increased by USD136.76 million to USD54.86 billion (24 September 2026). In the forwards market, the naira appreciated across the 1-month (+0.2% to NGN1,349.27/USD), 3-month (+0.2% to NGN1,386.17/USD), 6-month (+0.2% to NGN1,438.33/USD), and 1-year (+0.2% to NGN1,541.80/USD) contracts.
We expect the naira to remain broadly stable around current levels in the near term, supported by resilient portfolio inflows, a strong foreign reserve position and Nigeria’s current account surplus. While continued FX supply from investors and the CBN should help support routine demand, the recent policy rate adjustment by the MPC could impact the capital importation given the narrower yield differential. Over the short to medium term, we expect the durability of the naira stability will be dependent on (1) the pace of import-related demand, and (2) growth in crude oil-related receipts.