By Chukwuma Umeorah
The Nigerian equities market recorded one of its steepest drops in trading activity in recent months, even as it posted a notable price rally for the week ended July 25, 2025. Total trade volume fell by 78.96 per cent week-on-week (WoW) to 3.69 billion units, while turnover value plummeted by 77.65 per cent to N112.26 billion across 138,250 deals, compared to the 17.49 billion units and N500.76 billion traded in the prior week.
The sharp decline in activity stood in contrast to overall market performance, as the NGX benchmark All-Share Index (ASI) rose by 2.18 per cent WoW to close at 134,452.93 points, and market capitalisation gained N1.81 trillion to settle at N85.06 trillion. This lifted the year-to-date (YtD) return on the NGX to 30.63 per cent.
Analysts at Cowry Asset Management attributed the subdued activity to cautious investor behaviour and tactical adjustments by institutional players. “The significant drop in market activity suggests a cautious recalibration by institutional investors and portfolio managers ahead of month-end positioning,” Cowry stated in its weekly financial market review.
Despite the lower turnover, market sentiment remained positive. Sixty equities appreciated in price during the week, higher than 49 in the prior week, while 43 stocks declined, down from 54. Another 44 equities closed flat.
The week’s top gainers included The Initiates Plc adding 60.8 per cent in value, closing at N16.13 per share, followed by Academy Press gaining 33.0 per cent and closing at N9.31 per share while Nigerian Enamelware added 32.7 per cent and end the week at N27.00 per share.
On the other hand, Secure Electronic Technology lost 24.0 per cent in value dropping to N0.92 per share, Omatek Ventures shed 23.9 per cent to N1.24 per share and Meyer Plc dropped by 21.4 per cent down to N16.50 per share.
Sectoral performance was broadly positive, with all major indices closing in the green. The NGX Industrial Goods Index gained 4.66 per cent followed by the NGX Insurance Index at 3.07 per cent and the Consumer Goods Index at 2.81 per cent. The NGX Banking and Oil & Gas indices rose moderately by 1.84 per cent and 0.87 per cent respectively, as investors rebalanced toward fundamentally strong counters in light of fixed income yield movements.
According to Cowry, the rally was partly driven by “robust corporate earnings and declining yields in the fixed income and money markets,” particularly after the mid-week Treasury bill auction hinted at lower rates. These developments encouraged a shift from debt instruments to equities.
Despite this upbeat equity market sentiment, broader economic indicators remain mixed. The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) held all key policy rates unchanged at its July 22 meeting, citing mixed inflation signals. While headline inflation declined for the third consecutive month to 22.22 per cent in June, core inflation rose to 22.76 per cent, and food inflation also ticked upward.
Analysts suggest that although recent trends in annual headline inflation may have opened a window for a moderate rate cut potentially in the range of 25bps to 100bps, the Committee opted for caution, given the persistent volatility in monthly inflation readings.
The inflation outlook continued to be shaped by structural issues, including high transportation costs, FX-linked production input costs, and infrastructure challenges. These pressures, coupled with external risks such as global tariffs and geopolitical instability, informed the MPC’s decision to hold rates steady.
Meanwhile, during the week under review, the NGX confirmed the suspension of trading in MRS Oil Nigeria Plc ahead of its planned delisting, following regulatory approval.
For the coming week, analysts predict that market activity may pick up as more corporate results were released and investors adjust portfolios in response to earnings and economic data. However, they warn that until trade volumes recover and inflation pressures ease materially, sustained market momentum may be difficult to achieve.
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