For most investors, the instinct is to look for clarity before making a move, such as a clear trend or a strong signal. Something that feels decisive enough to act on. But not every market week offers that.
There are periods when the signals are less obvious, when different parts of the market are pulling in different directions, and when the usual shortcuts for decision-making stop working as well as they used to. Those are the moments that tend to test discipline more than anything else.
Last week was one of those periods. Let’s break down the highlights.
Global Economy
US: Fifth Week of Losses and Collapsing Confidence
US equities closed a volatile week with the S&P 500, Dow Jones Industrial Average, and Nasdaq Composite all extending losses for a fifth consecutive week. The economic calendar was light, so markets focused on geopolitical developments in the Middle East and oil price swings rather than domestic data.
Large-cap technology stocks continued to face pressure, while mid- and small-cap stocks posted modest gains, snapping four-week losing streaks. When money moves from big tech into smaller companies, it usually means either tech valuations got stretched, or investors are hunting for value in overlooked names. Given the five-week decline in major indices, it’s likely both.
Business activity growth slowed to an 11-month low in March. The Flash Composite PMI declined to 51.4, driven by softer services activity even as manufacturing showed slight improvement. PMI readings above 50 indicate expansion, but barely.
Inflationary pressures intensified dramatically. Input costs rose at the fastest pace in 10 months, driven by higher energy prices and supply disruptions. Companies passed on those costs at the quickest rate since 2022. This is the cascade effect of energy shocks. When oil and gas prices spike, transportation costs rise, and manufacturing input costs increase. Companies can either absorb those higher costs and squeeze their margins or pass them to customers and risk losing sales. Most choose to pass them on, which is why energy inflation eventually shows up everywhere.
Consumer sentiment also collapsed. The University of Michigan index fell to 53.3 amid deteriorating short-term economic and personal financial expectations. When consumer sentiment drops that sharply, it matters for two reasons. First, consumers who feel worse about the future spend less, which slows economic growth. Second, low confidence can become self-fulfilling. If enough people expect a recession and cut spending accordingly, they create the recession they feared. Inflation expectations rose to 3.8%, which is problematic for the Federal Reserve, trying to keep price pressures contained.
Europe: Modest Gains Amid Growing Concerns
European equities ended the week modestly higher, with the STOXX Europe 600 Index rising 0.35%. Performance across major markets was mixed. Germany’s DAX declined 0.29% while Italy’s FTSE MIB led gains with a 1.26% advance. When different European markets move in opposite directions, it usually reflects country-specific factors rather than unified continental trends.
The European Central Bank signaled its readiness to adjust rates at any meeting if necessary, as rising energy prices heighten inflation risks. But ECB President Christine Lagarde cautioned that it remains too early to determine the scale and persistence of these pressures. Here’s the tension. Energy prices are surging now, which is immediately pushing inflation up. But if the surge is temporary and prices fall back in a few months, raising interest rates today could be unnecessary and even harmful. The ECB needs to figure out whether the shock is transient or sustained before committing to a policy path.
Lagarde also warned that markets may be underestimating the economic fallout from current tensions. When a central bank president says markets are too optimistic, investors should pay attention. Central bankers have access to data and analysis that isn’t public. If they’re seeing deterioration that market prices don’t reflect, it suggests either a disconnect or delayed recognition that will eventually be corrected.
Business confidence in Germany weakened sharply. The Ifo Business Climate Index fell to 86.4, its lowest level since February 2025. Business confidence matters because companies that expect weaker conditions don’t hire aggressively, invest in capacity expansion, or take risks. That caution becomes reality as reduced business activity creates the weakness they anticipated. Across the broader eurozone, business activity growth slowed with the Composite PMI easing to 50.5 amid contracting new orders and renewed supply chain disruptions.
The OECD revised its growth outlook, projecting eurozone expansion at 0.8% and UK growth at 0.7% for 2026. Growth below 1% is barely above stagnation. For developed economies that need to service debt, support social programs, and maintain living standards, sub-1% growth creates fiscal pressures that compound over time.
Sub-Saharan African Economies
Across the region, sovereign bonds moved in different directions. Geopolitical tensions and shifting risk appetite drove the action.
South Africa: Rate Hold with Rising Inflation Ahead
The South African Reserve Bank held its key repo rate at 6.75% on March 26th, marking a second consecutive pause. The decision came despite inflation matching the 3% target in February.
Policymakers noted that higher energy prices are expected to push inflation higher in the near future. Headline inflation is projected to rise to around 4% in the second quarter, led by fuel inflation exceeding 18%.
The central bank revised inflation forecasts upward to 3.7% for 2026 from 3.3% previously and to 3.3% for 2027 from 3.2%. They also changed their policy outlook, now projecting only one rate cut instead of two previously. Fewer rate cuts mean borrowing stays more expensive for longer, which slows economic activity but helps contain inflation. The SARB is choosing price stability over growth support.
The bank assessed two possible scenarios for an Iran conflict. A short-term two-month scenario and a prolonged one-year scenario, both implying the need for higher interest rates. When a central bank starts scenario planning for geopolitical conflicts, it reveals how seriously they’re taking external risks. The fact that both scenarios point to higher rates suggests they see inflation risk outweighing growth concerns, regardless of how the conflict plays out.
Zambia: Inflation Hits Eight-Year Low
Zambia’s annual inflation rate fell to 7.1% in March 2026 from 7.5% in February, marking the third consecutive month of deceleration. This was the lowest reading since March 2018. Eight years is a long time between records. For Zambians who’ve lived through years of higher inflation eroding their purchasing power, this represents meaningful relief. Food inflation slowed to 7.8% from 8.2%, and non-food prices decreased to 5.9% from 6.5%.
When both food and non-food inflation are declining simultaneously, it suggests broad-based disinflation rather than just one category improving while another deteriorates. That’s healthier because it means progress is more likely to be sustainable. On a monthly basis, the CPI rose 0.6% in March, at the same pace as the prior month. Stable month-over-month increases while year-over-year inflation falls indicate the pace of price increases is moderating but not reversing.
Domestic Economy
Major Updates During the Week
1. CBN allows oil companies full repatriation
The Central Bank of Nigeria allowed International Oil Companies unrestricted use of their repatriated export proceeds, enabling them to fully repatriate earnings through authorized dealer banks. Let’s break down what this actually means. Oil companies operating in Nigeria earn dollars by selling crude oil internationally. Previously, there were restrictions on how they could use those dollars and what percentage they could take out of the country.
The new policy removes those restrictions. IOCs can now bring their export earnings into Nigeria and then take them right back out if they choose. Why does this matter? For oil companies, it reduces the risk that their profits get trapped in Nigeria. That risk was one factor discouraging new investment. If companies worried they couldn’t fully repatriate earnings, they’d be less willing to commit capital to Nigerian projects. By removing that concern, the CBN aims to make Nigeria more attractive to oil and gas investment.
The tradeoff is foreign exchange outflows. Every dollar an oil company repatriates is a dollar leaving Nigeria’s forex reserves. The CBN is betting that attracting more investment by reducing restrictions will ultimately bring in more capital than it repatriates. Whether that bet pays off depends on whether IOCs actually increase investment in response to the policy change.
2. Money transfer operators face new requirements
The CBN directed International Money Transfer Operators, including Western Union and MoneyGram, to maintain Naira settlement accounts with authorized dealer banks and channel all transactions through these accounts beginning May 1st, 2026. This might sound technical, but it has practical implications for anyone receiving remittances from abroad.
Currently, IMTOs operate with some flexibility in how they settle transactions and manage their naira liquidity. The new requirement centralizes everything through authorized dealer banks. For the CBN, this provides better oversight and control over money flows. They can track remittance volumes more accurately, monitor compliance with exchange rates, and ensure IMTOs aren’t operating outside the official system. For users, the impact depends on implementation. If the new structure creates additional friction or delays in processing transfers, people will feel it immediately. If it’s seamless, most won’t notice the change.
Equity Market: Rally Ends After Three Weeks
The Nigerian equity market reversed course this week, slipping 0.12% to close at 200,913.06 points after three consecutive weeks of gains. The decline was driven by selloffs across industrial goods, consumer goods, and banking sectors. When multiple sectors sell off simultaneously, it indicates broad risk-off sentiment rather than problems specific to one industry. Investors were taking profits after the strong rally that pushed the index above 200,000 for the first time.
Market breadth was relatively balanced with 47 gainers and 45 losers. Balanced breadth during a declining week suggests distribution rather than panic. Some investors are selling while others are buying, creating churn rather than one-directional movement. PREMPAINTS, PRESCO, and AIRTELAFRI led gainers while FIDSON, CADBURY, and ZENITHBANK dragged on performance.
Only two of the five major sectors closed positively for the week. The insurance sector led gains, rising 2.22%. When most sectors are declining but insurance rallies, it often reflects sector rotation as investors move money from areas that have already run up into laggards that haven’t participated as much in recent gains. Overall, the week reflects cautious investor sentiment amid profit-taking in stocks that delivered strong returns during the previous three-week advance.
Fixed Income Market: Demand Stays Strong Despite Rate Environment
The Debt Management Office held its fourth Treasury Bills auction of the month on March 25th. The 364-day paper attracted ₦2.73 trillion in subscriptions against a ₦200 billion offer. When demand exceeds supply by more than 13 times, it reveals investors are comfortable with current yields and eager to lock them in. The DMO allotted ₦520.7 billion across the 91-day, 182-day, and 364-day tenors, with stop rates of 15.95%, 16.42%, and 16.43%, respectively.
The strong bids at relatively lower rates caused the secondary market average yield to close relatively unchanged at 17.76%. When auction stop rates come in lower than secondary market yields, it often pulls secondary yields down as investors reprice their expectations. The fact that yields held steady despite strong auction demand suggests the market has found a level at which buyers and sellers agree on fair value.
The bond market had a tougher week with average yields rising 5 basis points amid mild selling pressure on short-tenor instruments. Short-term bonds sold off while longer-term bonds were relatively stable. This flattening of the yield curve suggests investors are less certain about near-term policy direction but more confident that longer-term inflation will remain contained. When you’re uncertain about the next few months, you don’t want to lock your money up at today’s short-term rates in case better opportunities emerge soon.
In the Eurobond market, Nigeria’s sovereign papers weakened significantly. Yields increased 29 basis points week-over-week to 7.47% as persistent geopolitical tensions continue triggering risk-off sentiment among global investors. A 29-basis-point move in a single week is substantial for sovereign debt. It indicates investors are repricing Nigerian credit risk higher or demanding more compensation for geopolitical uncertainty. Either way, it makes future borrowing more expensive for the Nigerian government.
The Bottom Line
There is a tendency to look for clear direction in the market before making decisions. Weeks like this challenge that approach.
When different asset classes and policy signals move in sync, the focus shifts from reacting to interpreting. Not every change demands action, but it does demand awareness.
Understanding how these pieces fit together is what allows investors to stay deliberate, even when the market is not straightforward.
