MoneyAfrica| Investment Research
Weekly Market Commentary
September 8, 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
Nigeria’s Debt Servicing Burden Deepens in 2024
Nigeria’s debt servicing burden grew heavier in 2024 compared to 2023. About 77.5% of federal revenue went into debt repayment, up from 76.8% in 2023, meaning little progress has been made in freeing up funds for infrastructure or social spending. On a broader scale, debt service rose to 4.1% of GDP from 3.7%, as total debt climbed and the weaker naira pushed up the cost of foreign loans.
The increase was driven mainly by higher external obligations, including repayments to multilateral lenders, China’s Exim Bank, and Eurobond investors. At home, while bond repayments eased, the government leaned more on short-term treasury bills, whose interest costs surged.
Overall, there has been no improvement; rising costs and heavy reliance on borrowing continue to squeeze Nigeria’s fiscal space and weigh on growth plans.
Key Takeaways:
- Nigeria’s rising foreign debt and weaker naira are pushing debt costs higher, leaving less room for government projects.
- Heavy reliance on short-term treasury bills raises future repayment risks.
What Investors Stand to Gain:
- Higher interest rates on treasury bills and bonds now give investors a chance to earn stronger returns.
- Growing government borrowing needs mean more frequent opportunities in the fixed-income market.
FX Update
Naira Strengthens Across Official and Parallel Markets
Between Friday, August 29, 2025, and Friday, September 5, 2025, the naira recorded slight gains across both the official and parallel markets. In the official market, it strengthened from around ₦1,536.27/$ on August 29 to about ₦1,529.19/$ by September 5, reflecting a 0.5% weekly appreciation. In the parallel market, the naira also firmed, moving from roughly ₦1,545/$ at the end of August to around ₦1,535/$ by early September .
On the reserves side, Nigeria’s external buffers remain robust. As of September 4, foreign reserves stood at $41.30 billion, just below the four-year high of $41.49 billion reached on September 3. Other reports confirm reserves have edged higher, touching $41.46 billion, the strongest level since late 2021, supported by sustained dollar inflows and CBN interventions.
Key Takeaway:
- The naira is firmer this week, but the recovery is tentative. Keep saving dollar goals in dollars where possible.
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.
Key Takeaway:
- The naira is firmer this week, but the recovery is tentative. Keep saving dollar goals in dollars where possible.
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.
Key Takeaway:
- The naira is firmer this week, but the recovery is tentative. Keep saving dollar goals in dollars where possible.
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
Banking and Consumer Stocks Drag Market Lower
The Nigerian Exchange (NGX) All-Share Index (ASI) declined by 0.94% during the week, shedding 1,315.49 points to close at 138,980.01 compared to 140,295.50 in the previous week. As a result, the year-to-date return moderated slightly to +35.03%, down from the previous session. Market capitalisation fell by ₦696 billion to settle at ₦87.7 trillion.
Banking: The banking sector was one of the hardest hit, with the index falling by 2.3% as profit-taking weighed on key stocks like AccessCorp (-1.34%), UBA (-1.16%), and Wema Bank (-10%).
Consumer Goods: The sector also came under pressure as Lafarge (-9.88%), International Breweries (-6.72%), and AIICO (-10%) weighed on performance. Investors appear cautious about earnings outlooks amid rising costs and high interest rates.
Oil and Gas: Trading was mixed, with Seplat dominating market value at ₦28.4 billion worth of trades, though the sector overall offered little support to the broader index.
Industrial Goods: The sector saw limited movements, though profit-taking in selected names contributed to the overall bearish tone.
Key Takeaway:
- The market’s pullback reflects profit-taking in large-cap banking and consumer names after strong year-to-date gains. With high interest rates and lingering regulatory uncertainties, investors are trading cautiously and waiting for stronger earnings signals before making fresh commitments.
Fixed Income Update
Treasury Bill Yields Spike at Latest Auction
Last week, the Central Bank of Nigeria (CBN) held a treasury bills auction valued at ₦480 billion, spread across 91-day, 182-day, and 364-day maturities. This came alongside ₦324.41 billion in maturing bills, providing some liquidity relief, though the higher supply was expected to exert upward pressure on yields.
- 91-day bill: Slightly lower to 17.19% from 18.17%.
- 182-day bill: Slightly lower at 18.94% compared to 19.45%.
- 364-day bill: Humped sharply to 26.89% from 20.67%—showing investors want much higher returns for longer-term lending
Bond yields averaged 16.87%, almost flat compared to 16.94% the week before.
Key Takeaway:
- The sharp jump in the one-year bill means the government is paying more to borrow, and investors are demanding higher returns. These rates give good income opportunities, but they may stay unstable because of tight cash in the system.
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 Struggle Amid Weak US Jobs Data and Trade Uncertainty
Weak US labour data weighed on sentiment this week, with the economy adding just 22,000 jobs in August, far below the historical average of 150,000–200,000 monthly gains in stronger periods. Unemployment climbed to 4.3%, the highest since 2021, underscoring the labour market’s slowdown. The weak report reinforced expectations for Federal Reserve rate cuts, which buoyed Wall Street and supported broader risk appetite. At the same time, trade policy uncertainty continues to loom, with markets awaiting the US Supreme Court’s October ruling on tariffs, a decision that could reshape supply chains and add fresh pressure on exporters.
In China, markets pulled back this week, with major indices down about 2% as regulators moved to curb speculation. Concerns grew over record margin lending, which has fuelled volatility, while officials also proposed cutting fees in the $4.9 trillion mutual fund industry to encourage more long-term investing.
The MSCI World Index declined by 0.36% over the week, though it remains up 12.67% year-to-date, reflecting uneven performance across regions.
Key Takeaway:
- In equities, the US market was little changed, with the S&P 500 edging up by 0.04% and holding a year-to-date gain of 9.8%. In the United Kingdom, the FTSE 100 slipped by 0.14% but remains up 12.6% so far this year. France’s CAC 40 also lost ground, down 0.27%, while in Japan the Nikkei 225 declined by 0.69%, though both benchmarks are still positive year-to-date at 4.2% and 8.7% respectively. Meanwhile, emerging markets continued to lead the global pack, with the MSCI Emerging Markets Index advancing 20.7% since the start of the year.
Global markets are being lifted by US rate-cut expectations and strong momentum in China and emerging markets. It shows why spreading investments across different markets is important.
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!