Spread between official, unofficial foreign exchange markets dropped by N30.59US$/1—Coronation

Coronation Research has said in its weekly financial markets summary for last that the “official rate of the exchange rate depreciated a little by 0.28% w/w to close at N1,454.41/US$1 from N1,450.42/US$1, while the parallel market rate appreciated by 0.67% w/w to settle at N1,485.00/US$ from N1,495.00/US$ in the previous week.

“Consequently, the spread between both markets decreased to N30.59US$/1 from N44.57/US$1, from the previous week. Foreign exchange inflows through the Nigerian Foreign Exchange Market (NFEM) decreased to US$716.3mn from US$844.70mn in the previous week.

Foreign Portfolio Investors accounted for the highest share of inflows at 32.98%, followed by exporters at 30.84%, CBN (17.36%), Non-bank Corporates (16.94%), others (0.72%) and Individuals (0.63%). Gross foreign reserves rose by 0.71 % w/w US$45.43bn from US$45.11bn in
the previous week.

“The equities market closed on a positive note for the second consecutive week, consolidating on the previous week’s gains. The All-Share Index (ASI) and market capitalisation advanced by 1.63% and 1.64% respectively, to close at 149,433.25 points and N95.26trn. As a result, the year-to-date (YTD) return improved to 45.18%, up from 42.86% in the prior week.

“The bullish market sentiment was buoyed by renewed buying interest in key large-cap stocks, notably MTN Nigeria (+12.98% w/w), Guaranty Trust Holding Company (+1.01% w/w), and Zenith Bank (+2.98% w/w). These gains more than offset selloffs in select heavyweights, including Access Holdings (-6.51% w/w), Oando (-0.51% w/w), and United Bank for Africa (-0.75% w/w).

“Sectoral performance was largely positive during the week. The NGX Insurance Index led the gains, advancing by 3.40% w/w, followed by the “NGX Consumer Goods Index (+2.64% w/w), NGX 30 Index (+1.67% w/w), NGX Pension Index (+1.33% w/w), and NGX Industrial Goods Index (+0.23% w/w). In contrast, only two sectors closed lower during the week, with the NGX Banking Index declining by 0.12% w/w and the NGX Oil and Gas Index falling by 0.13% w/w.

“We expect the market to trade with a mildly positive tone this week, supported by interest in fundamentally strong names. That said, some profit-taking in recently rallied stocks may temper overall momentum. Broadly, sentiment should remain mixed but slightly bullish as investors react to liquidity conditions and macro cues.

“Oil prices dipped last week, giving up gains accumulated over the last two weeks, with Brent falling to US$61.17/bbl, down 4.05% on the week (-18.05% ytd), the lowest levels seen since October 2024 due to growing concerns about an oversupplied market.

“Recent projections from the US Energy Information Administration reinforced these concerns. US crude output is expected to continue expanding, reaching a peak of 13.61mn barrels per day by the end of 2025, before edging slightly lower to 13.53mn barrels per day in 2026.

“This supply backdrop has weighed on sentiment, particularly as non-OPEC production remains resilient. On the demand side, OPEC remains positive but cautious. The cartel expects global oil consumption to rise by roughly 1.40mn barrels per day by 2026, with growth concentrated in non-OECD economies. However, this pickup in demand is seen by some analysts as insufficient to fully offset the volume of new supply expected to enter the market.

“Meanwhile, geopolitical developments have failed to provide price support. Markets continue to track negotiations related to the Ukraine conflict, but the associated risk premium has diminished.

Likewise, the recent US seizure of a Venezuelan oil tanker triggered little reaction in prices, showing how dominant the supply fundamentals narrative is currently, as similar events would typically have pushed crude prices higher at least in the short term.

So far in the year, Brent has traded at a year-to-date running average of $68.40/bbl, 14.34% lower than the average of $79.85/bbl in 2024. Bonny Light closed the week at US$63.74/bbl (11 December 2025), down 3.09% on the week”.