Trading Tuesday - Nigeria’s Market Strength Amid Global Uncertainty
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Market Overview
Good evening and welcome to today’s market wrap up. Nigeria’s economy is showing resilience with rising revenues, record reserves, strong bond demand, and fresh oil sector investments, despite weaker NNPC profits. Globally, markets remain volatile as U.S. Fed tensions, Ukraine-driven oil disruptions, and looming U.S. tariffs on India weigh on sentiment, while Brazil’s inflation cooled and Irish consumer confidence improved.
Nigerian News & Market Update
NNPC’s four-month income hits ₦20trilllon as marketers seek refineries revamp:
The Nigerian National Petroleum Company Limited (NNPC) made ₦20.9trillion in revenue between April–July 2025 but saw profits plunge from ₦905billion in June to ₦185billion in July. It remitted ₦7.97trillion to the federation account (Jan–June) but still owes the FG about ₦6.57trillion in unpaid royalties, taxes, and dividends. Marketers urged a quick revamp of Port Harcourt, Warri, and Kaduna refineries, while the World Bank criticised NNPC for remitting only half of subsidy savings despite rising revenues. - Punch
External reserves projected to hit $45billion by year-end:
Nigeria’s external reserves rose to $41billion in August 2025, the highest in 44 months, after gaining $1.56billion in three weeks. Analysts project reserves could reach $45billion by year-end, boosting the CBN’s ability to stabilise the naira through interventions. The rise is driven by stronger oil receipts, portfolio inflows, and potential external borrowing. Risks remain from global financial shifts or inflow reversals, but experts say maintaining reserves above $40billion would strengthen investor confidence and support exchange rate stability. - Punch
Currency in circulation drops to ₦5trillion in 6 months:
Nigeria’s currency in circulation (CIC) rose year-on-year by 25%, reaching ₦5.007 trillion in June 2025, up from ₦4.04 trillion in June 2024, according to Central Bank of Nigeria (CBN) data. Despite this annual growth, CIC slightly declined month-on-month in 2025, dropping from ₦5.4 trillion in December 2024 to ₦5.0 trillion in June 2025. Analysts attribute the overall rise to increased government revenue allocations, naira devaluation, and higher crude oil earnings. Currency outside banks also fell to ₦4.49 trillion in June, down from ₦4.63 trillion in May. - Dailytrust
FG raises ₦136.16billion from August bond auction:
The Debt Management Office (DMO) raised ₦136.16 billion at the FGN bond auction conducted on Monday, August 25, 2025. The sale featured a new five-year bond (17.95%, due August 2030) and a reopened seven-year bond (18%, due June 2032), attracting strong demand with total subscriptions of ₦268.17 billion. The five-year bond drew ₦102.36 billion in bids, with ₦46.01 billion allotted, while the seven-year bond attracted ₦165.81 billion and saw ₦90.15 billion allotted. Both instruments will be repaid in full at maturity through a bullet repayment structure. - Guardian
CBN Offers Higher Rates on OMO Bills to Keep Hot Money Coming:
Foreign portfolio investors (FPIs) and local banks are heavily investing in Nigerian Open Market Operations (OMO) bills as the Central Bank of Nigeria (CBN) offers high yields to attract foreign inflows and support the naira. At its latest auction, the CBN offered ₦600billion in 89- and 124-day bills, but demand surged for the 124-day paper, with ₦1.01trillion in subscriptions and ₦894.94billion allotted at a 25.99% stop rate. The 89-day bill was undersubscribed, with ₦2.25billion allotted at 25.50%. Analysts say the results reflect investor preference for higher-yielding, medium-term securities amid tight liquidity. - Dmarketforces
Firm boosts Nigeria’s oil reserves by 126 million barrels:
MSM Group, an indigenous oil and gas firm, has boosted output at Oil Prospecting License (OPL) 98 from 118m to 224m barrels within six months of takeover from the Nigerian National Petroleum Company Limited (NNPCL), adding 126m barrels. Chairman Muazzam Mairawani credited President Tinubu’s support for the company’s return to the sector after exiting in 2017. The firm used alternative technology instead of seismic methods to achieve the increase and plans to raise $2.5billion through a U.S. IPO, targeting $2.7billion investment into Nigeria. - Guardian
Nigeria Sectoral Indices Performance
The table below shows that NGX indices were mixed: Banking and Consumer Goods led gains, Insurance slipped slightly. Week-to-date, Industrial Goods dragged, while Banking advanced. Month-to-date, Insurance soared over 51%, but Oil/Gas and Premium Board fell. Year-to-date, Insurance (+87%) and Lotus (+66%) are strongest, while Oil/Gas remains the only loser (-12%).
Fixed Income (FGN Bonds)
Global News & News Update
Short-term Treasury yields fall, while long-term yields rise after Trump orders removal of Fed’s Cook:
Trump’s bid to fire Fed Governor Lisa Cook rattled markets, steepening the U.S. yield curve as short-term yields fell and long-term yields rose. Cook rejected Trump’s authority, vowing to stay. Investors now expect looser Fed policy, while strong U.S. economic data added to optimism ahead of key inflation figures. - CNBC
US and Russian officials discussed energy deals alongside latest Ukraine peace talks:
U.S. and Russia discussed possible energy deals including ExxonMobil’s return, U.S. tech sales for Liquefied Natural Gas (LNG), and icebreaker purchases during Ukraine peace talks. The offers were tied to sanctions relief, with Trump pushing for quick wins while also threatening new sanctions and tariffs. - Reuters
Brazil's mid-month inflation index posts first drop in two years:
Brazil’s mid-August consumer prices fell 0.14%, the first drop in two years, mainly due to lower electricity costs and cheaper food, transport, and communication. Annual inflation eased to 4.95%, nearing the central bank’s target range, while interest rates remain at a nearly 20-year high of 15%. - Reuters
Irish consumer sentiment improves slightly in August:
Irish consumer sentiment rose slightly in August 2025 to 61.1 from 59.1 in July, easing from a near two-year low, according to the Credit Union Consumer Sentiment Survey. The improvement follows a late-July U.S.-EU trade deal imposing a 15% tariff on most EU exports, which was less severe than feared, reducing uncertainty for Irish consumers. However, sentiment remains well below August 2024’s 72.1 and the long-term average of 83.8, with high living costs still a major concern, said survey authors. - Reuters
Oil falls 2% from highest in almost 3 weeks, focus on Russian supply risks:
Oil prices fell about 2% after Monday’s surge, as markets weighed Ukraine’s strikes on Russian refineries, possible U.S. tariffs on Indian oil imports (up to 50%), and threats of new U.S. sanctions on Russia. Despite supply risks, analysts expect Brent to trade in the $65–$74 range amid ongoing war and tariff uncertainties. - Reuters
Steep US tariffs set to hit Indian exports from Wednesday:
The U.S. has raised tariffs on Indian exports to 50%, hitting over half of India’s $87billion U.S. trade. Exporters expect a 20–30% drop in orders, while the rupee and stocks fell. India plans financial aid and market diversification, but analysts warn the move could cut 0.8% from GDP growth. - Reuters
Indices, Commodities & Currencies
The table below depicts that the U.S. indices showed slight gains, while European and Asian indices weakened. Energy and metals were broadly lower, soft commodities were mixed, grains mostly strengthened, and currencies were mixed with the USD weakening.
Fixed Income (USA Bonds)
Events
Conclusion
Nigeria’s markets are buoyed by stronger reserves, oil gains, and robust demand for bonds and OMO bills, but global uncertainties from U.S. tariffs to oil volatility pose risks. If reserves keep rising and foreign inflows persist, FX stability and equities could strengthen, while higher tariffs or prolonged oil weakness may trigger renewed pressure. Staying nimble is key as local fundamentals and global risks collide.
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