MoneyAfrica| Investment Research
Weekly Market Commentary
May 4, 2026.
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
Nigeria’s PMI Dips Below 50 for the First Time in 16 Months
Nigeria’s steady expansion in economic activities hit a speed bump in April 2026, according to the Central Bank of Nigeria’s (CBN) Purchasing Managers’ Index (PMI).
After 16 months of continuous expansion, the PMI, which tracks the health of the economy, fell to 49.4 points. A score below 50 means the economy is shrinking, which signals a shift from the strong 53.2 points recorded in March.
The contraction was mostly felt in the Industry and Services sectors. Businesses reported a drop in new orders and a more cautious approach to hiring as demand from customers slowed down. The services sector, especially transportation and warehousing, saw the biggest hit. On the other hand, Agriculture remained a “bright spot,” marking its 21st month of growth at 50.2 points. However, across all sectors, production costs rose by 3.2 points, forcing many companies to increase their prices to keep up with rising expenses.
The CBN points to “external pressures” as the main cause. The ongoing geopolitical tension in the Middle East has disrupted global shipping and supply chains, making it harder and more expensive for Nigerian businesses to get the materials they need. This uncertainty has dampened business confidence, causing firms to hold back on expansion and inventory.
Key Takeaway:
- The drop to 49.4 is a clear warning that global tensions are now hurting local productivity. This contraction suggests that economic growth for the first half of the year will likely be weaker than expected. If the conflict in the Middle East continues to disrupt supply chains and keep costs high, Nigeria faces the risk of a sustained slowdown for the remainder of 2026. For business owners, the focus now shifts to managing these rising costs while waiting for a clearer picture of global stability.
FX Update
Naira Holds Firm as CBN Deploys $1.5B to Bridge Supply Gap
The naira saw a slight 1.2% dip in the official window last week, closing at ₦1,374.94 on May 1 compared to ₦1,358.66 the previous Friday. This marginal slide comes as the Central Bank of Nigeria (CBN) continues to battle high demand for dollars from manufacturers and importers. Interestingly, the parallel market showed better strength, with the rate improving to ₦1,385 from last week’s ₦1,400. This boost in parallel market liquidity has crashed the gap between the two rates to just ₦10, the narrowest spread in recent memory.
Nigeria’s gross external reserves continued a downward trend, settling at $48.37 billion as of April 30. This represents a $1.57 billion total drain since the multi-year peak of over $50 billion in mid-March. Specifically, the buffers dropped from $48.54 billion at the start of the week to $48.4 billion by late Friday, representing an average weekly drawdown of roughly $140 million to $230 million. CBN Governor Olayemi Cardoso attributed this decline to active market interventions where the Bank is selling dollars to defend the Naira, alongside increased outflows from portfolio exits and industrial imports.
Key Takeaway:
- The narrowing spread to just ₦10 between the official and parallel rates is a massive win for market transparency, but it is currently being “bought” by the CBN. With a $1.57 billion drawdown in just over a month, the stability of the naira depends heavily on the bank’s willingness to keep spending from its $48.4 billion reserve to meet the high demand for dollars.
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Equities Update
NGX Momentum Accelerates with 7.33% Weekly Surge Powered by Q1 Earnings
The Nigerian stock market kicked into high gear this week, nearly doubling its pace from the previous week. The All-Share Index (ASI) surged by 7.33%, a massive jump compared to the 3.94% gain recorded last week. This aggressive rally pushed the Year-to-Date (YTD) return to a staggering 55.69%, up from 45.05% just seven days ago. In just five trading days, investors gained ₦8.66 trillion in value, as the market rewarded strong Q1 2026 corporate results most notably from the NGX Group, which saw its profits double.
The Industrial Goods sector was the week’s undisputed champion, skyrocketing 16.89% behind a 24.78% surge in BUA Cement. The Oil and Gas sector also stayed hot, rising 14.37% to bring its YTD return to a jaw-dropping 128.34%. Consumer Goods joined the rally with a 3.20% gain, while Insurance dipped slightly by 1.13%.
However, the Banking sector broke away from the bull run, falling 5.52%. This was partly due to share prices being adjusted (Price-down) as Zenith, GTCO, and Wema reached their dividend payment dates. The biggest drag was UBA, which saw its stock plummet after reporting weaker profits and a massive ₦331 billion provision for bad loans. Investors were further disappointed by the bank’s decision to skip a full-year dividend to fix its balance sheet, though a small recovery on Friday helped it close at ₦45.85.
Key Takeaway:
- The jump from a 3.94% gain last week to 7.33% this week proves that market momentum is actually accelerating, not slowing down. While the banking sector is navigating a “cleanup” phase due to dividend dates and UBA’s heavy provisioning, the rest of the market is being powered by solid Q1 earnings. This shows that investors are looking past short-term banking volatility to reward sectors delivering real growth.
Fixed Income Update
Treasury Bill Yields Rise
After a small drop last week, Treasury bill yields moved back up this week. The 364-day bill yield climbed to 18.85%, up from 18.65% last Friday. Other tenors followed the same upward trend: the 180-day bill rose to 17.16% (from 16.49%), and the 90-day bill edged up to 16.18% (from 15.95%). This tells us that even though the CBN kept official rates steady at the last auction, everyday traders in the market are now charging more to buy and sell these bills.
The week’s main event was the DMO Bond Auction on Monday, April 27. The government offered ₦700 billion and received massive interest, with investors offering to lend nearly ₦950 billion. However, the DMO only accepted ₦276.8 billion, about 30% of the total bids.
The reason for this low allotment was the high interest rates demanded by investors, with some bids reaching as high as 22.6%. Rather than locking the country into such expensive debt, the DMO chose to borrow much less than planned. Ultimately, the government settled on “marginal rates” between 16.30% and 16.59%. The 10-year benchmark bond yield settled at 15.75%, as traders adjusted their pricing to align with the higher rates seen in the primary market
Key Takeaway:
- Yields are creeping back up. After a brief dip last week, the secondary market is now pushing the 364-day yield back toward the 19% mark. For investors, the message is clear: the era of high returns isn’t over. Treasury bills remain a top-tier low-risk option.
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Star-Spangled Banner Recap
Tech Giants Power Global Markets to Record April Finish
The global market ended the week (April 27 – May 1, 2026) with a powerful surge. Even though tensions in the Middle East kept oil prices high, investors focused on massive profits from big tech companies and a steady hand from central banks.
The week’s biggest news came from the US Federal Reserve, which held interest rates steady at 3.50%–3.75%. Investors were particularly focused on whether the Fed would signal a future rate hike to fight rising oil-driven inflation. Instead, the Fed maintained a “neutral” stance, which relieved traders who had feared a more aggressive move. This “hold” suggests the Fed is waiting for more data before making any changes, giving the stock market room to rally.
The real spark, however, came from “Big Tech.” Earnings from Alphabet (Google), Amazon, and Apple were so strong that they pushed markets to new heights. While oil prices jumped as high as $118 during the week before settling at $105.73, the “AI boom” was strong enough to keep the rally going.
It was a great week for American and Japanese stocks, but Europe felt the pain of high energy costs:
The Nasdaq was the star, rising 1.12% this week to hit a record 25,000 points. The S&P 500 also gained 0.91%. While Japan’s Nikkei dipped slightly by 0.34% this week, it is still up a massive 18.22% for the year. European markets struggled. France’s CAC 40 fell 0.53%, and the FTSE 100 (UK) dropped 0.15%. This is because European factories and businesses are paying much more for energy due to the closed trade routes in the Middle East.
Overall, the MSCI World Index (which tracks global stocks) rose 0.76% for the week and is up 5.15% since January.
Key Takeaway:
- The world market is moving at two different speeds. US and Japanese tech stocks are breaking records because of the AI boom, but Europe is being held back by a “hidden tax” on high oil prices. For your portfolio, the gains in the US look great, but the global economy won’t be fully safe until the energy crisis in the Middle East is settled.
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We hope you find this edition insightful, and as always, stay focused on your financial goals!