NGX opened week on a negative note as investors await FTSE Russell’s definitive update on Nigeria

The Nigerian equities market opened this week on a negative note, with the NGX All-Share Index (ASI) and market capitalisation declining by 0.84% to settle at 241,749.11 points and N155.13trn, respectively while market last week reversed losses recorded in the prior week as the All-Share Index (ASI) and market capitalisation advanced by 6.35% w/w to settle at 243,798.76 points and N156.44trn, respectively.

Consequently, the market’s year-to-date return moderated to 55.35%. The selloffs was driven by profit-taking in stocks such as BUACEMENT (-9.99%), ZENITHBANK (-3.25%) and FIRSTHOLDCO (-5.20%), which outweighed gains recorded in ACCESSCORP (+0.20%), STANBIC (+3.15 %) and INTBREW (+9.77%).

Meanwhile, trading activity strengthened as total traded volume advanced by 18.65% to 523.54mn units, while the value of transactions rose by 14.81% to N22.28bn. AIICO (+0.25%) led the volume chart with 40.17mn units traded, while LIVESTOCK (-2.70%) topped the value chart with N1.89bn worth of shares exchanged.

Market breadth was negative at 0.46x, indicating that the market had more decliners than gainers. A total of forty-eight (48) stocks closed in negative territory, led by PZ (-10.00%), while twenty-two (22) stocks advanced, with INTBREW (+9.77%) leading the gainers’ chart. 

According to Coronation “consequently, the market’s year-to-date return last week improved to 56.67%, reflecting sustained investor appetite across key sectors.

“The bullish performance was driven by significant gains in stocks such as ARADEL (+19.67% w/w), FIRSTHOLDCO (+25.82% w/w), DANGCEM (+17.51% w/w), NGXGROUP (+17.80% w/w), ACCESSCORP (+10.40% w/w), and AIRTELAFRI (+10.00% w/w), which outweighed losses in CAP (-9.99% w/w), ETI (-9.98% w/w), GEREGU (-10.00% w/w), GUINNESS (-9.99% w/w), and STANBIC (-6.63% w/w).

“All sectoral indices edged higher with NGX Industrial Goods (+10.46% w/w) leading the chart, followed by NGX Oil & Gas (+8.11% w/w), NGX Pension (+6.66% w/w), NGX30 (+6.60% w/w), NGX Banking Index (+4.78% w/w), NGX Insurance Index (+4.04% w/w), Consumer Goods Index (+3.11% w/w).

“We expect mixed sentiment in the market in the near term as investors await FTSE Russell’s definitive update on Nigeria and H1 earnings start to feed into the market., FTSE Russel is expected make its decision by end-August 2026, ahead of the planned September 2026 implementation of the reclassification of Nigeria as a frontier market.

“They have concerns that the new T+1 settlement process on the NGX effectively functions as a pre-funded market for international institutional investors.

“The Naira weakened at the Nigerian Foreign Exchange Market (NFEM) window last week, depreciating by 0.68% week on week to close at N1,379.62/US$1, compared with N1,370.19/$1 in the previous week. Despite opening the week on a stronger note and appreciating to N1,368.27/$1 on Monday, the local currency surrendered these gains over the course of the week amid renewed demand pressures.

“In the parallel market, the exchange rate also closed higher at N1,420.00/$1 from N1,400.00/$1. Consequently, the parallel market premium rose to N40.38/$1, from N29.81/$1 recorded in the previous week. On the external front, Nigeria’s gross foreign exchange reserves rose by 0.42% week on week to $51.74bn as of 9 July 2026, reflecting continued improvement in the country’s external position.

“Total foreign exchange inflows for the week amounted to $0.97bn. Fixed Income Foreign Portfolio Investors (FPIs) remained the largest source of inflows, contributing 30.29% ($0.29bn), closely followed by Exporters and Importers at 30.14% ($0.29bn). Non-bank corporates accounted for 26.49% (US$0.26bn), while the Central Bank of Nigeria (CBN) contributed 6.93% ($0.07bn).

“Other sources made up the remaining 5.40% of total inflows. Looking ahead, we expect the naira to trade within a relatively stable range, supported by sustained foreign exchange inflows and the CBN’s continued market interventions, although persistent underlying FX demand is likely to keep depreciation pressures elevated.

“Crude oil prices rebounded during the week, reversing three consecutive weeks of declines, as renewed geopolitical tensions in the Middle East outweighed concerns over rising global oil supply. Consequently, Brent crude rose by 5.04% week-on-week to close at $76.02/bbl, from $72.37/bbl in the previous week.

“The increase was primarily driven by renewed tensions between the United States and Iran. Attacks on tankers near the Strait of Hormuz prompted retaliatory U.S. strikes, while the U.S. also revoked the waiver that had allowed Iranian crude exports to re-enter the global market.

“These developments raised concerns over potential supply disruptions, pushing Brent close to $80/bbl during the week before prices eased on renewed diplomatic efforts. The geopolitical developments outweighed bearish supply-side factors, including OPEC+’s decision to increase production by 188,000 barrels per day from August and elevated output from the UAE.

“Looking ahead, oil prices are expected to remain volatile as markets monitor developments in U.S.–Iran negotiations, the impact of tighter restrictions on Iranian oil exports, and upcoming U.S. inventory data for further direction on global supply and demand.

“The fixed income market closed the week on a bullish note, as broad-based buying interest across the secondary market drew support from favourable liquidity conditions. System liquidity expanded by N1.46trn w/w to N4.33trn, buoyed by OMO maturity of N2.21trn.

“The Open Repo Rate (OPR) held steady at 22.00% p.a., while the Overnight Rate (OVN) edged higher to 22.23% p.a. from 22.18% p.a. in the preceding week. The Debt Management Office (DMO) offered N700bn in the Nigerian Treasury Bill (NTBs) across the 91-day, 182-day, and 364-day papers. Demand came in at N2.03trn, higher than the N1.86trn recorded at the prior auction.

“However, the DMO allotted N1.06trn, lower than the N1.49trn at the prior auction. Demand remained skewed toward the long end of the curve, with the 364-day paper attracting N1.86trn of total subscriptions. Stop rates cleared at 16.30% p.a., 16.50% p.a., and 17.70% p.a., across the 91-day, 182-day, and 364-day bills. Notably, the 364-day stop rate saw the sharpest move, widening 36bps relative to the prior auction, reflecting a sustained aggressive borrowing stance for the quarter.

“Sentiment across the secondary market was broadly bullish. The average T-bill yields, spanning both the NTB and OMO segments, declined by 22bps w/w to close at 19.72% p.a. The OMO segment was the stronger
performer, with yields easing 18bps w/w to settle at 21.58% p.a. The NTB segment followed with yields tightening by 14bps w/w to close at 18.51% p.a.

“The FGN Bond market mirrored the broader bullish tone, with the average yields declining by 15bps w/w to close at 17.63% p.a. Gains were anchored at the short (0-5Y) and mid (6-12Y) of the curve, where yields declined by 11bps w/w, and 25bps w/w, respectively, while the long-end (>12Y) ticked up marginally by 2bps w/w.

“In the Eurobond space, average yields compressed 8bps w/w to close at 6.95% p.a., with buying interest evident across all Nigerian Eurobond notes. The SEP-28-2033, FEB-16-2032, and JAN-21-2031 notes led the move, compressing 21bps, 17bps, and 13bps w/w, respectively.

“The bullish tone may persist into the coming week, with fresh demand likely to follow through into the NTB space as investors continue to seek out attractive yields. The DMO’s N700bn offer will be a key directional signal, particularly with no maturities due.

A further absence of OMO issuance from the CBN may see investors redirect demand into the
NTB segment, keeping buying interest well supported”.