Think Thursday - Nigeria’s Capital Markets Rebound Amid Oil Sector Weakness, Global Trade Shifts
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Market Overview
Good evening and welcome to today’s Market kickoff. We’re seeing a dynamic shift in Nigeria’s financial landscape, where non-oil sectors are driving market optimism, even as the oil sector continues to struggle. From stock market surges to legislative reforms, the mood in the local capital markets remains largely bullish, thanks to insurance and industrial sector gains. Globally, investor sentiment is mixed, influenced by U.S. tariff policies, central bank decisions, and rising unemployment signals in the U.S. economy.
Nigerian News & Market Update
NGX surges by ₦640billion as Guinness Nigeria tops gainers:
The Nigerian stock market gained ₦643billion on Wednesday as the All-Share Index rose by 0.70% to 145,813.86, driven by strong performance in insurance, banking, and industrial sectors. Major gainers like Guinness, NEM Insurance, AXA Mansard, and Learn Africa all rose 10%. Trading volume and value also surged. Only the Oil & Gas sector declined, while investor interest and bargain hunting fueled the market rebound. - Punch
Insurance stocks jump 10% after President signed law to recapitalise industry:
President Tinubu signed the Nigerian Insurance Industry Reform Act (NIIRA) 2025, aiming to modernize and strengthen the insurance sector. The news led to a 10% surge in insurance stocks on the NGX. The law consolidates outdated regulations and supports Nigeria’s goal of building a $1 trillion economy. Experts and regulators praised the move, urging for simpler, more transparent insurance policies to boost public trust and industry growth. - Guardian
Mutual Benefits Assurance reports ₦7.8 billion profit in Q2 2025, on booming insurance revenue:
Mutual Benefits Assurance Plc reported a strong Q2 2025 performance with a pretax profit of ₦7.8billion, compared to a loss of ₦1.1billion in Q2 2024. Half-year profit rose to ₦12.2billion, driven by higher insurance revenue and lower service expenses. The company also saw a significant rise in investment income and total assets, while cash premiums increased to ₦47.2billion and claims paid doubled to ₦22billion. - Nairametrics
Oil sector struggles as government misses revenue target:
Nigeria's oil sector underperformed in 2024, generating ₦9.83 trillion in revenue by August well below the ₦13.33 trillion target. Key issues include oil theft, pipeline vandalism, low production, and poor infrastructure, causing a significant revenue shortfall. In contrast, non-oil revenue outperformed expectations, reaching ₦10.33 trillion, driven by strong VAT and corporate tax collections. The government plans reforms to boost oil output and reduce losses, while continuing efforts to diversify the economy away from oil dependence. - Punch
Nigeria Sectoral Indices Performance
The table below shows that the Nigerian stock market is showing strong overall performance, with most sector indices posting solid gains. The Insurance, Industrial Goods, and Lotus Index are the top performers, with year-to-date (YTD) gains of 64.14%, 56.29%, and 74.77% respectively. The Oil & Gas sector is the only laggard, down 10.34% YTD. Despite minor short-term dips in the Banking and Consumer Goods sectors, both remain strong for the year.
Overall, market sentiment is positive, led by non-oil sectors.
Fixed Income (FGN Bonds)
Global News & Market Update
S&P 500 rises after Trump’s chip tariffs have broad exemptions:
U.S. stocks were mixed on Thursday as tech gains lifted the S&P 500 (+0.2%) and Nasdaq (+0.6%), while the Dow fell 0.3%. The rally followed President Trump’s announcement of a 100% chip tariff—with exemptions for U.S.-based production. AMD rose 5%, Nvidia 2%, and Apple 2% after pledging an additional $100 billion investment in U.S. suppliers. Despite trade tensions, positive economic data supported market sentiment. So far this week, the S&P 500 is up 2.2%, Nasdaq 3.5%, and Dow 1.6%. - CNBC
British Pound rallies after BOE rate cut decision reveals divide on policy:
The British Pound rose 0.5% after the Bank of England cut interest rates by 25 basis points. The decision revealed a split within the Monetary Policy Committee: four members voted to hold, four to cut, and one pushed for a larger 50-point cut. A second round of voting was needed to reach a majority for the 25-point cut, highlighting increased division compared to June’s 6-3 vote to hold rates. - CNBC
US Continuing Jobless Claims Rise to Highest Since End of 2021:
Recurring unemployment benefit claims have risen to their highest level since November 2021, signaling that job seekers are finding it harder to secure new employment. This follows a weaker-than-expected July jobs report, heightening concerns among investors and economists about a potential slowdown in the U.S. labor market. - Bloomberg
South Africa rand buoyed by stronger gold prices as U.S. tariffs kick in:
The South African rand rose 0.5% to 17.6850/USD on Thursday, supported by higher gold prices and a weaker U.S. dollar, despite new 30% U.S. tariffs on South African imports. The JSE Top-40 index gained 0.6%, and the 2035 government bond yield edged up to 9.655%. Net foreign reserves slightly declined to $65.143 billion in July. - Reuters
Indices, Commodities & Currencies
The table below depicts that the Global markets were mostly positive, driven by gains in European and Asian equities and broad strength in metals and grains. Energy prices declined (WTI, Brent), while soft commodities showed a mixed trend. The U.S. dollar strengthened slightly, and volatility (VIX) rose, indicating mild investor caution. Despite some U.S. equity weakness, the overall market sentiment remained optimistic, backed by strong performance in commodities and non-U.S. equities.
Fixed Income (USA Bonds)
Events
Conclusion
Nigeria’s stock market is gaining momentum, driven by strong performance in non-oil sectors like insurance and industrials, following recent reforms. Despite continued challenges in the oil sector, rising non-oil revenues show a positive shift in fiscal strategy. Looking ahead, market gains may continue in key sectors, while global economic trends and local policy reforms will shape investor sentiment.
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