MoneyAfrica| Investment Research
Weekly Market Commentary
December 1, 2025.
Good morning, readers, and welcome to this week’s edition of our stock market newsletter!
As always, our newsletter is divided into two sections: Green White Green, covering the Nigerian stock market, and the Star-Spangled Banner, focusing on the US market.
Green White Green Recap
Macro Update
CBN Holds MPR at 27.0% Despite Falling Inflation
The Central Bank of Nigeria’s (CBN) Monetary Policy Committee (MPC) concluded its 303rd meeting last week (November 24–25, 2025) by retaining the Monetary Policy Rate (MPR) at 27.0%. This decision was reached despite a continued, sharp decline in headline inflation, which eased to 16.05% in October 2025 from 18.02% in September.
While we expected a rate cut, the MPC chose to sustain the tight monetary stance to achieve low and stable inflation. The decision to hold is inconsistent with the decision to cut interest rates due to falling inflation in September 2025.
However, the Committee adjusted the asymmetric corridor around the MPR to +50/-450 basis points. This makes it cheaper for banks to borrow from the CBN, which has the added benefit of making it cheaper for banks to borrow among themselves in the interbank market.
We believe the CBN’s decision to maintain high rates is in support of its strategy to continue attracting foreign investors. This strategy is proving effective, with gross external reserves rising significantly to US$46.70 billion as at November 14, 2025.
For investors, this continued tightness is beneficial. The long-dated 364-day Treasury Bill, yielding approximately 18.3%, is now officially above the inflation rate. This means savers can experience positive real returns and grow their purchasing power.
Key Takeaways:
- With the MPR held firm, investors in Nigerian fixed-income instruments like 364-day Treasury Bills are now enjoying a positive real return against the 16.05% inflation rate.
FX Update
Naira Strengthens Marginally as Reserves Hit 7-Year High
The naira demonstrated slight resilience last week, posting marginal gains in the official market while Nigeria’s external reserves continued their robust ascent to a seven-year high.
In the official Nigerian Foreign Exchange Market (NFEM), the currency closed the week at ₦1,446.74/$, showing appreciation compared to the ₦1,456.73/$ recorded at the close of the previous week. Similarly, in the parallel market, the naira closed slightly stronger at ₦1,470.00/$, compared to ₦1,474.00/$ the week before.
Meanwhile, the external reserves maintained their strong upward trajectory. The reserves reached $44.557 billion as of November 26, 2025, surpassing the previous week’s figure of $44.189 billion. This steady build-up in reserves, which earlier this month hit a seven-year high of $46.7 billion, is supported by improved foreign investor participation and disciplined monetary policy.
The rising reserves provide the CBN with significantly stronger foreign exchange buffers to manage market pressures and provide essential backing for the currency.
Key Takeaway:
- Nigeria’s external reserves have climbed to a seven-year high of $44.557 billion, substantially strengthening the country’s FX buffers. We expect the exchange rate stability to continue in the near term given the high external reserves and the trend of falling global interest rates.
Remember to save dollar-based goals in dollars, which can be done with apps like Ladda. Just visit www.getladda.com to download. You can also earn up to 20% by investing in naira savings.
Equities Update
NGX Index Stabilises After Volatile Week
The Nigerian Exchange (NGX) stock market ended a volatile week with a minor decline of -0.14%, a sharp contrast to the previous week’s 2.24% loss. Despite the loss, the market maintains an exceptionally strong Year-to-Date (YTD) gain of 39.44%.
Early in the week, there was sustained selling pressure, followed by a bullish run on last Tuesday and Wednesday, driven by renewed investor optimism and gains in large-cap stocks. The market closed marginally lower in the week due to losses in specific heavyweight sectors.
The Industrial Goods sector was the primary drag, recording a 1.92% loss. The Consumer Goods sector also saw profit-taking, closing 0.70% down, while the Oil and Gas sector slipped by 0.23%. In contrast, the Banking sector showed resilience, leading the market with a 0.67% gain. The Insurance sector remained largely flat with a marginal loss of 0.07%.
A key non-price development for the market was the successful adoption of the new T+2 settlement timeline, which became effective on Friday, November 28, 2025. The adoption of the new T+2 settlement timeline means that investors will receive their cash from stock sales or ownership of purchased stocks two business days faster than the previous T+3 timeline, significantly enhancing market liquidity and efficiency.
Key Takeaway:
- Following last week’s sharp profit-taking, the NGX stabilised, with a decline of only 0.14%. The Banking sector outperformed other sectors due to sustained interest from investors .
Fixed Income Update
Treasury Bill Yields React to MPC Hold
The fixed-income market displayed mixed movements this week, as secondary market yields responded to the Central Bank of Nigeria’s (CBN) decision to hold the Monetary Policy Rate (MPR) at 27.0%. There was no primary auction this week, leaving the focus on secondary market activity.
The previous week’s trend of slight easing was largely reversed, particularly on the long end of the curve. Last week, the 91-day Treasury Bill yield closed at 16.31%. This week, it saw a slight drop to 16.20%. However, the 182-day paper increased its yield to 16.92% compared to 16.76% last week. Most notably, the 364-day Treasury Bill yield saw an increase to 18.27% from 17.98% the previous week.
In the broader bond market, benchmark FGN Bond yields saw a slight increase this week, closing at 15.51% compared to 15.49% previously.
Key Takeaway:
- The rise in the 364-day T-Bill yield to 18.27% confirms high investor confidence in the long-term prospects of high returns. We expect this stability to continue in the near term given high external reserves and falling global interest rates.
You can invest in treasury bills to save for your short-term goal on rent, schools, fees, etc. through Ladda—a fintech app that helps you save at high returns.
For long-term goals, naira-denominated fixed income instruments are not suitable due to inflation and currency risks
Star-Spangled Banner Recap
Global Markets Rebound Strongly on Renewed Rate Cut Hopes
Global markets experienced a strong positive turnaround last week (November 24–28, 2025), driven by a significant shift in sentiment. This reversal was fuelled primarily by renewed confidence that the US Federal Reserve might cut interest rates in December and easing worry over the US labour market’s health following favourable economic data, which included better-than-expected Initial Jobless Claims figures.
The MSCI World Index, a measure of global equity performance, rose a significant 2.37% for the week. US markets led the rally: the Dow Jones Industrial Average surged 4.29%, the S&P 500 gained 4.47%, and the technology-heavy Nasdaq Composite recovered sharply, posting a 3.83% weekly gain.
The market rally was primarily triggered by comments made by a top Federal Reserve official, which significantly increased investor confidence that the Federal Reserve would cut interest rates in December. Crucially, market confidence was also encouraged by the release of better-than-expected Initial Jobless Claims data. This data showed a lower number of new unemployment applications than forecasted, suggesting the labour market remained resilient without being inflationary and thereby supporting the dovish outlook.
European and Asian markets mirrored this strength. Japan’s Nikkei 225 climbed 2.04%, while Europe’s FTSE 100 (UK) and CAC 40 (France) posted solid gains of 1.90% and 1.15%, respectively. Globally, sectors like banking, health care, and technology saw strong gains, indicating a broad return to risk-taking.
Key Takeaway:
- Global markets enjoyed a strong risk-on rebound this week, driven by renewed optimism for a US Federal Reserve rate cut. This reversal underscores the high sensitivity of equity markets to central bank policy expectations.
Remember to always save for your dollar goals in dollars. You can do this with us on Ladda—a fintech app that helps you save at high returns.
We hope you find this edition insightful, and as always, stay focused on your financial goals!