Nigerian Stock Market Gains N24.4 Trillion in Two Months

Nigeria’s stock market has experienced a remarkable surge, gaining N24.4 trillion in value over the first two months of 2026. This increase is largely attributed to a shift by investors from low-yield federal government bonds into equities, driven by robust corporate earnings and a favorable macroeconomic environment. By the close of trading on February 24, the total market capitalization of the Nigerian Exchange stood at N123.76 trillion, reflecting a significant increase of 24.5 percent from N99.38 trillion at the start of the year.

The market reached a peak of N125 trillion on February 20 before experiencing a slight moderation. A detailed analysis shows that January contributed N6.8 trillion to this growth, lifting the capitalization to N106.15 trillion. February delivered an even more substantial gain of N17.61 trillion, pushing the total figure to N123.76 trillion.

Impact of Policy Changes and Corporate Performance

The sharp rally in February was spurred by a significant policy shift from the National Pension Commission (PenCom), which increased the equity investment limits for pension funds. This change reignited demand for listed equities, particularly those with strong fundamentals. Following the announcement on February 9, the market advanced by N6.79 trillion as new liquidity entered the stock market.

The Nigerian Exchange Limited All-Share Index (NGX ASI) closed February at 192,826.78 basis points, reflecting a year-to-date growth of 23.9 percent, or 37,213.75 basis points, from its opening level of 155,613.03 basis points. In January, the index rose by 6.3 percent to 165,370.40 basis points, followed by a surge of 16.6 percent in February, highlighting the market’s strong performance.

Analysts attribute this resilience to various factors, including increased liquidity ahead of the 2027 general election, strategic portfolio rebalancing, ongoing banking sector recapitalization driven by the Central Bank of Nigeria (CBN), improved foreign exchange stability, and a moderation in inflationary trends. The reforms implemented by the federal government and regulatory bodies in 2025 have also contributed positively to the market’s performance.

Investor Confidence and Future Prospects

The Nigerian stock market’s performance in 2025 was impressive, with a 51.2 percent annual return despite facing double-digit inflation. The CBN’s decision to lower the Monetary Policy Rate (MPR) to 27 percent aimed to strengthen the naira and attract foreign portfolio inflows, further enhancing equity market momentum. This shift marks a significant turnaround from the subdued market conditions experienced between 2015 and 2019, following the oil price crash and the 2016 recession.

David Adnori, Vice President of Highcap Securities, described the January-February surge as evidence of improving economic stability and increasing participation from foreign investors. He noted that the positive response to the release of full-year 2025 results by listed companies, especially those offering dividends, has continued to attract strong demand.

Similarly, Aruna Kebira, Managing Director of Globalview Capital Limited, linked the N24.4 trillion expansion to expectations of robust earnings for 2025 and improving macroeconomic indicators. He emphasized that stability in foreign exchange and competitive returns on equities compared to fixed-income instruments have bolstered investor participation, a trend likely to persist into the first quarter.

Kebira stated, “The technical rally began in December 2025. Most of the results released so far are impressive, even where some fall slightly below expectations. As more earnings are announced, the positive momentum is likely to be sustained.”

Currently, the transition from low-yield bonds to equities, combined with favorable policy adjustments and strong corporate earnings, has reinforced investor confidence, positioning the Nigerian stock market for a potentially robust first quarter in 2026.