MoneyAfrica| Investment Research
Weekly Market Commentary
July 6th, 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.
Macro Update
IMF Flags ₦8.83 Trillion in Unreported Government Spending
The International Monetary Fund last week revealed that the Federal Government of Nigeria omitted approximately ₦8.83 trillion in public spending equivalent to roughly 2% of GDP from its official budget records in 2025. The finding emerged from the IMF’s 2026 Article IV consultations with Nigeria. The unreported expenditure relates to capital projects executed outside the formal budget framework, meaning they did not appear in official budget documents or implementation reports.
The consequence is significant. Because this spending was not recorded, Nigeria’s official fiscal deficit appeared smaller than it actually was, understating the government’s true borrowing requirements and making the country’s fiscal position look healthier than it is. The IMF called on the Federal Government to align with international reporting standards and record all expenditures within the formal budget framework.
The Federal Ministry of Finance rejected the findings, maintaining that all public spending was conducted within the bounds of the law and characterising the IMF report as misleading.
Key Takeaway:
- If the IMF’s figures are accurate, Nigeria’s true fiscal deficit is larger than officially reported, meaning the government’s borrowing needs are higher than the public has been told. For investors and creditors assessing Nigeria’s fiscal health, the gap between reported and actual spending is a material risk that cannot be ignored.
FX Update
Naira Stabilises as Reserves Hit a Fresh 17-Year High
The naira recovered in the official market last week, closing at ₦1,370.19/$ , an appreciation of ₦10.74 from ₦1,380.93/$ the previous week. In the parallel market, the naira weakened by ₦7 to ₦1,395/$ from ₦1,388/$ the previous week.
The parallel market premium widened to ₦24.81 (1.81%), up from ₦7.07 (0.51%) the previous week; the gap between the two markets has reopened slightly after nearly closing the week before.
External reserves climbed to $51.549 billion as of July 3, up from $51.248 billion the previous week, likely supported by higher exports and portfolio investments.
Key Takeaway:
- The official rate recovered and reserves hit a fresh 17-year high, both signalling positive momentum for the naira. However, the parallel market premium widening to 1.81% from near zero the previous week suggests renewed dollar demand pressure in the informal market. If the gap keeps widening, it signals that the official market is not fully meeting dollar demand which would pressure the naira.
Remember to save dollar-based goals in dollars, which can be done with apps like Ladda. Visit www.getladda.com to download. You can earn up to 8% for dollar savings and 20% by investing in naira savings.
Equities Update
NGX Falls for a Third Consecutive Week as Market Rebalances
The NGX All-Share Index declined 1.21% last week, extending a three-week losing streak and pulling the year-to-date return down to 47.31% from 49.12% the previous week. The sustained decline reflects a natural market rebalancing after an extended bull run earlier in the year. Investors are rotating out of stocks that delivered the strongest gains and locking in profits ahead of the second half of the year.
Every sector closed lower last week. Industrial Goods led the decline, falling 4.93%, though it remains up 70.85% for the year. Oil and Gas dropped 4.34%, now up 82.04% for the year. Banking fell 3.72%, now up 35.31% for the year. Insurance slipped a further 2.52%, deepening its year-to-date loss to -8.43%, the only sector in negative territory for the year. Consumer Goods was the most resilient, declining 1.60%, now up 14.47% for the year.
Looking ahead, the CBN’s Q3 Treasury Bills issuance programme which plans to raise ₦5.8 trillion, a 241% increase from Q3 2025 introduces a significant new supply of high-yielding instruments into the market. With 1-year T-bill yields hovering around 20%, investors now have a compelling low-risk alternative to equities, making the case for staying in stocks harder to justify unless companies deliver strong H1 earnings. If earnings growth disappoints when results begin to emerge, expect further capital rotation from equities into fixed income.
Key Takeaway:
- Three consecutive weeks of decline reflect a market going through natural rebalancing. Investors are rotating out of stocks that rallied strongly earlier in the year and locking in profits. This is not unusual after an extended bull run. The stocks absorbing the heaviest losses are largely the same ones that delivered the biggest gains year-to-date, which underscores why investing in fundamentally strong companies matters more than chasing short-term price momentum. Quality stocks with solid earnings and strong balance sheets tend to hold their value better during corrections and recover faster when sentiment turns.
Fixed Income Update
Yields Climb Further as CBN Signals Aggressive Q3 Borrowing
No new primary market auctions were held last week. In the secondary market, T-bill yields continued to rise across all tenors. The 90-day yield edged up to 16.84% from 16.83% the previous week, the 180-day climbed to 18.61% from 17.75%, and the 364-day rose to 20.78% from 19.66% crossing back above the 20% mark. The average benchmark bond yield rose to 17.54% from 17.12% the previous week. OMO bills in the secondary market are yielding between 21.36% on the January 2027 paper and 21.90% on the August 2026 paper.
The bigger story last week was the scale of government borrowing planned for Q3. The CBN intends to raise ₦5.8 trillion in T-bills across 13 auctions from July to September, a 241% increase from the ₦1.76 trillion issued in Q3 2025. After repaying ₦2.64 trillion in maturing bills, net new T-bill borrowing stands at approximately ₦3.16 trillion. Separately, the DMO plans to raise up to ₦4 trillion through three bond auctions in July, August, and September, reopening existing instruments maturing in 2035, 2037, and 2038. Combined, the government is planning to borrow significantly more than it is repaying this quarter both short and long-term.
This level of net new supply puts upward pressure on yields across the curve. With crude oil prices declining, government revenue from oil is likely to remain under pressure, keeping borrowing needs elevated. Bond yields may rise through Q3, though moderating energy and food prices could ease inflation expectations subsequently, creating room for yields to come down in Q4. For traders, this creates an opportunity to lock in higher yields now ahead of a potential easing later in the year.
Key Takeaway:
- The government is borrowing aggressively on both ends of the curve this quarter ₦3.16 trillion net in T-bills and up to ₦4 trillion in bonds. Yields are likely to stay elevated through Q3, but easing inflation could bring them down in Q4. The window to lock in high fixed income returns may be shorter than it appears.
You can invest in treasury bills for short-term goals—rent, school fees, and more through Ladda. Visit www.getladda.com to download the app and start earning today. For long-term goals, naira-denominated fixed income is not suitable due to inflation and currency risks.
Star-Spangled Banner
Markets Rebound as Inflation Cools and Jobs Data Pressures the Fed
The US labour market showed a sharp slowdown in June, with nonfarm payrolls adding just 57,000 jobs well below the 110,000 forecast and down from a revised 129,000 in May. The unemployment rate edged down slightly to 4.2%, but only because 720,000 workers left the active workforce. The weak hiring data increases pressure on the Federal Reserve to consider rate cuts sooner to avoid a broader economic slowdown.
In Europe, inflation fell faster than expected, partly driven by easing energy costs as Brent crude fell below $71/barrel, its lowest level since the start of the US-Iran conflict following continued diplomatic progress. Eurozone headline inflation dropped to 2.8% in June from 3.2% in May, the first decline since early 2026 and below the 3.0% forecast. Core inflation, which strips out food and energy, also eased to 2.4% from 2.6%, with services prices moderating.
Global markets gained last week after the previous week’s tech-led selloff. In the US, the S&P 500 gained 1.71% for the week, now returning 9.32% year-to-date. The Nasdaq rose 1.87%, now at 11.15% year-to-date, and the Dow gained 1.89%, now at 10.06% year-to-date. The MSCI World Index gained 1.09%, now at 8.94% year-to-date.
Europe also joined the recovery: the FTSE 100 gained 1.63%, now at 7.53% year-to-date, and France’s CAC 40 rose 1.68%, now at 4.40% year-to-date. Japan’s Nikkei added 0.40%, now at 38.55% year-to-date.
Key Takeaway:
- Markets recovered last week as cooling inflation in Europe and weak US jobs data shifted expectations toward earlier rate cuts. Lower oil prices are easing cost pressures globally, but the sharp slowdown in US hiring is a signal that the economy may be losing momentum faster than anticipated..
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!