RFA Breakfast Paper - August 4, 2026

Egypt's PMI Improves but Signals Ongoing Private Sector Contraction

The S&P Global Egypt Purchasing Managers' Index (PMI) rose to 46.8 in July 2026 from 46.0 in June, pointing to a softer but still marked contraction in the country's non-oil private sector. New orders declined for a seventh consecutive month, reflecting weak domestic demand, elevated prices, shipping delays, and a slowdown in new project activity, although the pace of output contraction eased compared with the previous month. Employment continued to decline as firms adjusted to subdued business conditions, while backlogs of work increased at the second-fastest pace in nearly three years, indicating persistent operational pressures. Purchasing activity contracted at its sharpest rate since September 2023, leading to the first decline in input inventories in five months. On a more positive note, supply chain conditions improved for the first time since March, with supplier delivery times shortening as disruptions linked to the Middle East conflict eased. Cost pressures also moderated, with input cost inflation slowing to a six-month low and output price inflation easing to a four-month low, offering some relief to businesses. Looking ahead, business confidence climbed to its highest level since June 2022, although firms noted that the outlook remains heavily dependent on geopolitical developments and the stability of the regional operating environment.

U.S. Stocks Reach Record Highs as Falling Oil Prices Boost Risk Appetite

U.S. equity markets rallied on Tuesday, with the S&P 500 and the Dow Jones Industrial Average both closing at record highs. Investor sentiment improved as oil prices extended their decline, with WTI crude oil falling to around $76 per barrel following comments from U.S. Treasury Secretary Scott Bessent suggesting that an agreement to reopen the Strait of Hormuz could be reached in the near term. The easing in energy prices also supported fixed-income markets, with the yield on the 10-year U.S. Treasury securities declining to around 4.62%. Lower oil prices helped ease inflation concerns, providing additional support for equities.

NGX Retreats as Profit-Taking and Earnings Rebalancing Weigh on Sentiment

The Nigerian equity market closed lower on Tuesday, with the NGX All-Share Index (NGX-ASI) and Market Capitalization both declining by 0.38%. The pullback was driven by renewed profit-taking in mid- and large-cap stocks, alongside portfolio rebalancing as investors reacted to the ongoing release of half-year corporate earnings. Key decliners included FIRSTHOLDCO, WEMABANK, GTCO, and NESTLE. Consequently, the benchmark index shed 927.70 points to close at 244,802.83, while Market Capitalization fell by ₦598.83 billion to ₦158.02 trillion.