This week, robust corporate earnings sustained positive sentiment in the equities market, with the NGX ASI up 5.07% for the week and 16.57% for July. Like the market outlook, the IMF says it expects Nigeria’s GDP to grow by 3.4% in 2025 and 3.2% in 2026, a position that reflects the easing inflationary pressure, relatively stable FX market, and notable growth in some sectors.
Meanwhile, global commodities traded bullish despite the US reimposing tariffs on countries. The naira strengthened at the official window amid increased reserve accretion, although holiday demand pressured the parallel market rate. Bearish sentiment returned to the fixed-income markets. We expect sustained cautiousness in fixed income, while equities are likely to stay bullish due to interest in dividend-yielding stocks and improving macroeconomic signs.
Robust Corporate Earnings Sustained Positive Sentiment in the Equities Market
In the week ending August 01, 2025, a number of listed entities reported H1 2025 results. First Holdco saw a 51.67% surge in interest income to N1,437.41bn, despite higher impairment charges, driven by increased loans and investment income. ETI’s profit before tax rose 39.85% across its 35-country operations, reflecting a resilient diversified strategy. FCMB Group reported a 23% increase in profit before tax to N79.3bn, while Dangote Cement’s revenue grew 17.7% to N2.07trn, with profits soaring due to higher finance income. Presco Plc achieved a 121.8% revenue increase. Other firms like Aradel Holdings (N146.39bn PAT), Sterling Financial (N41.78bn PAT), Nestle Nigeria (N50.57bn PAT), UAC Nigeria (N7.36bn PAT), Seplat Energy (N42.52bn PAT), Transcorp Group (N85.7bn PBT), Unilever Nigeria (54% revenue growth), United Capital (N11.89bn PAT), and Transcorp Power (N44bn PAT) also posted strong results with significant revenue and profit growth. These rather impressive corporate earnings, underpinned by improved operational efficiencies and favourable macroeconomic conditions, despite weakening micro indicators, should sustain the NGX’s bullish momentum, as investors’ confidence strengthens amidst interim dividends announcements.
IMF Upgrades Nigeria’s FY 2025 Growth Projection to 3.4%
The International Monetary Fund (IMF) has revised and upgraded Nigeria’s economic growth projection for 2025 to 3.4% from 3.0% forecast published in its April 2025 World Economic Outlook. The upgrade comes due to increased confidence in ongoing reforms in the Nigerian economy. Global growth is projected to reach 3.0% in 2025 and 3.1% in 2026. The IMF’s Projection for 2026 growth was also upgraded by 0.5% points to 3.2%. The IMF report follows the National Bureau of Statistics (NBS) recent disclosure Nigeria Rebased GDP report, revealing that the Nigerian economy’s size stood at N372.82trn as of 2024, equivalent to US$244bn (using an exchange rate of N1,550/US$), compared to N277.49trn (approximately US$188bn) under the old base year. In terms of growth, GDP rose by 3.38% at the end of 2024 from 3.04% in 2023. Quarterly performance indicates that real GDP grew by 3.13% year-on-year (YoY) in Q1 2025, up from 2.27% in Q1 2024. We expect a sustained confidence level in the economy to drive above 3% growth; however, it lags behind the required 7% growth needed to attain the ambition for US$1trn economy by 2030.
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