August 2026, Edition 1
Financial markets concluded the final week of July 2026 amid improving domestic liquidity conditions, resilient investor demand, and heightened global policy uncertainty. In Nigeria, the fixed income market extended its bullish momentum as yields declined, with robust oversubscription at the Open Market Operation (OMO) and Treasury bills auctions, emphasized ample system liquidity and sustained confidence in government securities. The equities market recorded mixed performance, as interim dividend payments and profit-taking tempered gains amid better-than-expected H1 performance reports and corporate earnings releases from large-cap stocks. Globally, investors navigated a complex backdrop of cautious central bank decisions, moderating economic growth, persistent geopolitical tensions, and volatile commodity prices, with developments in the Middle East and evolving monetary policy expectations remaining the primary drivers of market sentiment across asset classes. Commodities closed the week lower week-on-week (WoW), with West Texas Intermediate (WTI) and Brent crude at $84.97/bbl. (-6.41%) and $87.93/bbl. (-10.02%), respectively, while gold at $4,042.97/oz (-0.22%).
System liquidity maintained a surplus path through the week after opening at ₦4.51 trillion, peaking at ₦6.52 trillion before closing at ₦2.98 trillion on Friday (-34.04%) week-to-date (WTD). Money market rates were stable, with the Open Repo Rate (OPR) at 22.00% and the Overnight (O/N) rate at 22.14% (WoW +2bps). In the Foreign Exchange (FX) market, the Naira traded within a range of $/₦1,359.00 and $/₦1,372.00, before closing at $/₦1,368.22 on Friday.
The fixed income market maintained a broadly bullish tone during the week, supported by sustained buying interest across both the Treasury bills (T-bills) and FGN bond segments. In the T-bills market, the average yield declined by 1bp to 18.18%, reflecting strong demand and bullish trading momentum following the primary market auction where the 364-day stop rate fell by 31bps. By Friday, average yield inched up to 18.30% (+13bps). OMO bills yield eased to 21.05% (-7bps). Similarly, the FGN bond market remained positive, with the average yield declining over the week to 16.91% (-15bps), driven primarily by buying interest in the short- to mid-tenor maturities, although profit-taking briefly emerged mid-week with demand majorly concentrated around the 2029–2038 maturities, as investors balanced global oil price volatility, central bank policy stance, and elevated risk premiums.
FX Liquidity Pulse: The outcome of the CBN’s OMO auction on 28 July 2026 reflected strong investor demand despite marginal changes in stop rates, reinforcing expectations that short-term yields were nearing their peak. Oversubscription ratios for the 91-, 119-, and 133-day bills were 2.12x, 2.11x, and 13.18x, respectively, indicating investors’ willingness to lock in current yields amid growing reinvestment risk and expectations of future rate moderation. Bids were tightly clustered within a 13–20 bps spread, with allotments made at the upper end across all tenors, supporting a strong pricing consensus and the CBN’s continued success in mopping up excess liquidity. Although the stop rates exhibited an inverted pattern, falling from 20.15% for the 133-day bill to 20.60% for the 91-day bill, the effective yields aligned with the normal duration premium, increasing from 21.72% for the 91-day bill (+3bps) to 21.73% for the 119-day bill (+4bps) and 21.75% for the 133-day bill (unchanged). Total allotment rose sharply to ₦3.48 trillion, up by 205.63% from the previous auction, highlighting ample liquidity mop-up and sustained demand for short-term government securities.
AUCTION DATE | TENOR | OFFER (₦‘B) | BIDS (₦‘B) | TOTAL SALE (₦‘B) | STOP RATES (%) | PREVIOUS TENOR RANGE STOP RATES (%) |
| 91-DAY | 200.00 | 424.50 | 424.50 | 20.6000 | 20.4900 |
119-DAY | 200.00 | 422.00 | 417.00 | 20.2900 | 20.1800 | |
133-DAY | 200.00 | 2,636.00 | 2,636.00 | 20.1500 | 20.1500 |
Primary Issuance Brief: The Nigerian Treasury Bills (NTB) auction held on July 29 reflected robust investor demand, particularly for the 364-day bill with total subscriptions of ₦3.62 trillion against a ₦700 billion offer, translating to a 5.17x bid-to-cover ratio (BCR). The 364-day tenor accounted for 93.4% of total demand, recording a BCR of 6.76x, despite its stop rate declining by 31bps to 17.35%, signalling investors’ willingness to lock in longer-term yields amid expectations of future rate moderation. Demand for the 91- and 182-day bills remained moderate at 1.36x and 1.05x, respectively, while allotment-to-offer ratios stood at 96.30%, 94.69%, and 30.11% across the short-, medium-, and long-term tenors. Notably, the 182-day bill’s bid range extended to 25.00%, underscoring prevailing reinvestment risk concerns. Effective yields settled at 16.99%, 17.98%, and 20.98% (down 46bps) for the 91-, 182-, and 364-day bills, respectively. Overall, the auction points the fixed-income market towards yield retracements, with investors increasingly positioning to mitigate reinvestment risk, while the CBN continues to effectively absorb excess system liquidity.
AUCTION DATE | 29-07-2026 | 29-07-2026 | 29-07-2026 |
MATURITY DATE | 29-10-2026 | 28-01-2027 | 29-07-2027 |
TENOR | 91-DAY | 182-DAY | 364-DAY |
OFFER (₦) | 100,000,000,000 | 100,000,000,000 | 500,000,000,000 |
SUBSCRIPTION (₦) | 135,741,541,000 | 104,737,174,000 | 3,378,376,103,000 |
ALLOTMENT (₦) | 130,722,009,000 | 99,177,174,000 | 1,017,296,886,000 |
BID RANGE (%) | 15.9700 – 18.0000 | 16.0000 – 25.0000 | 16.9800 – 20.0000 |
STOP RATES (%) | 16.3000 | 16.5000 | 17.3500 |
PREVIOUS STOP RATES (%) | 16.3000 | 16.5000 | 17.6600 |
The Naira depreciated mildly during the week in the Nigerian Foreign Exchange Market (NFEM), losing by ₦6.02 (+0.44%) WTD, and ₦6.14 (+0.45%) WoW, closing at $/₦1,368.22 (WoW: ₦1,362.09). Foreign reserves eased mildly from $52.03 billion to $51.92 billion (-0.21%) as of July 30, 2026, in addition to a decline in blocked funds to $594.20 million (-2.29%) with a reduced blocked reserve ratio of 1.14% (-0.3bps), reflecting an improved foreign exchange condition in spite of external pressures.
The Nigerian Exchange (NGX) equities market traded with mixed sentiment during the week, as an early rebound on Tuesday was outweighed by sustained profit-taking and the reflection of interim dividend payments. Consequently, the ASI declined from 247,238.74 points on Monday to 245,283.68 points by Friday at 245,283.68 points (WTD +0.79% and WoW -0.74%) and a year-to-date (YTD) return of 57.62% from 58.79%. Market breadth and capitalization weakened significantly from 1.09x to 0.53x, and from ₦160.86 trillion to ₦159.57 trillion across trading sessions, signalling a sharp deterioration in market sentiment and a broad-based increase in declining stocks. Across key indices, performance was mixed WoW: Banking (-0.69%), Consumer Goods (-2.29%), Industrial (-0.20%), Oil & Gas (-0.24%), and Insurance (+1.72%). Other H1, 2026 earnings release highlights include:
Global financial markets ended the week of July 31, 2026, on a resilient note, as a sharp rebound in technology and semiconductor earnings mitigated recent worries surrounding artificial intelligence (AI) and capital expenditures. On the macroeconomic front, major central banks leaned cautious: the Federal Reserve held its benchmark interest rate unchanged at 3.50%–3.75%, notably marked by a hawkish 9–3 vote with three dissents favouring a rate increase, while the Bank of Japan kept its policy rate steady at 1.0%. Economic growth signalled divergence across key regions; U.S. Q2 GDP slowed below expectations to 1.5% annualized, whereas Eurozone Q2 GDP delivered a positive upside surprise at 0.4% quarter-on-quarter. Compounded by diplomatic dialogue regarding the Strait of Hormuz, which temporarily eased oil supply anxiety, sovereign bond yields dipped and equity indices rallied broadly, pointing to a market that is digesting a soft-landing macro narrative alongside persistent inflation vigilance. The equities market performance closed mixed WoW: the Nasdaq Composite at 25,373.85 (+1.60%), S&P 500 at 7,489.72 (+1.05%), and the Dow Jones Industrial Average at 52,485.03 (+1.04%). Across Europe, Germany’s DAX 40 was at 25,629.24 (+1.48%), while the FTSE 100 was at 10,868.05 (+1.23%), and the Stoxx 600 at 649.19 (+1.67%). Asian markets were varied, with Japan’s Nikkei 225 at 64,362.02 (-0.39%), China’s Shanghai Composite Index at 3,832.26 (+0.47%), Hong Kong’s Hang Seng Index at 25,844.43 (+3.06%), and South Korea’s KOSPI at 6,595.45 (-1.42%).
Global commodity markets remained volatile during the week, driven largely by shifting geopolitical risks and monetary policy expectations. Brent crude fluctuated between $87.35/bbl. and $90.01bbl., ending the week at $87.93/bbl., while WTI crude traded within the $77.90–$84.21/bbl. range, closing at $84.67/bbl. Both benchmarks initially declined as easing US-Iran tensions reduced concerns over supply disruptions and improved prospects for oil flows through the Strait of Hormuz. However, renewed military confrontations, risks to Middle East shipping routes, attacks on energy infrastructure, and disruptions at the Caspian Pipeline Consortium terminal supported a recovery in prices. Amidst these supply concerns, increased tanker activity through the Strait of Hormuz and elevated Chinese crude inventories moderated gains. Gold prices traded between $4,016.67/oz and $4,107.18/oz, supported by safe-haven demand amid geopolitical uncertainty and a weaker US dollar, although expectations of tighter monetary policy following the Federal Reserve’s decision to hold rates steady limited further upside. Gold closed the week at $4,042.97/oz.
Market sentiment remains cautiously positive, supported by improving liquidity and resilient investor demand, while yields, FX stability, geopolitical developments, and global monetary policy will continue to shape near-term market direction. August 2026 is expected to be eventful, with key global and domestic policy meetings, major macroeconomic releases, and substantial liquidity inflows exceeding ₦10.95 trillion, comprising ₦9.47 trillion in OMO maturities, ₦713.02 billion in NTB maturities, ₦765.38 billion in FGN bond coupon payments, and $151.80 billion in Eurobond coupons, against scheduled FGN bond issuances and a ₦2.10 trillion NTB issuance programme. In the new week, the market is set to receive ₦2.45 trillion in OMO maturities and ₦283.78 billion in NTB maturities, providing ample liquidity to support continued demand for fixed-income securities. The CBN also cancelled the NTB auction set to hold in the first week of August.
By: Sandra A. Aghaizu
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