Victor Ezeja
Nigeria has catapulted itself to a global investment powerhouse by securing the third-highest returns worldwide. The latest data from The Nation’s Market Intelligence shows a renewed surge in Nigerian equities, thanks to optimistic investors gearing up for third-quarter earnings reports. This fervor has propelled the country’s year-to-date return to N8.7 trillion.
Amidst global challenges, Nigeria’s equities market is thriving. The upward shift in global returns charts is a testament to the nation’s resilience and commitment to investor-friendly reforms.
The data, covering markets across the advanced, emerging, and frontier tiers, reveal that Nigeria now trails only Turkey and Egypt in terms of year-to-date returns, with gains of 31.12 percent. Turkey’s BIST 100 Index leads the pack with a return of 47.3 percent, followed closely by Egypt’s EGX 30 Index at 37.0 percent.
Nigeria’s All Share Index (ASI) saw a remarkable rise of 1.12 percent, closing the week at 31.12 percent year-to-date, surpassing the previous fourth position. Ghana, which held the third spot, dropped to fourth place with a return of 28.7 percent.
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The Nigerian Exchange’s data indicates the performance of the nation’s equities market. The ASI closed the week at 67,200.69 points, reflecting a substantial year-on-year growth from 51,251.06 points at the beginning of the year.
The ongoing rally in the Nigerian equities market aligns with the optimism surrounding President Bola Tinubu’s administration, known for its pro-market reforms. The President’s economic reforms have generated an average return of 2.25 percent or N628.1 billion in the first four months of the year, ushering in what experts term a “post-inauguration rally.”
Market analysts have consistently pointed to the positive influence of macroeconomic developments and significant reforms, which have contributed to this thriving market. Investors seem to have faith in the new administration’s commitment to ease investment repatriation and profitability.
The Nigerian equities market has shown resilience in the third quarter, with gains of N8.24 trillion and an average return of 29.52 percent. This positive performance follows the trend of three consecutive years of growth, with a full-year average return of 19.98 percent, amounting to a net capital gain of N4.455 trillion in 2022.
Sectoral analysis highlights robust performance across various segments, with the NGX Oil and Gas Index leading at 97.63 percent return. Other sectors, including Consumer Goods, Insurance, Banking, and Pension, have also registered impressive returns, painting a picture of a diverse and attractive equities market.
As the year unfolds, market experts remain optimistic, expecting the Nigerian market to continue in a positive trajectory. However, caution prevails in some quarters, citing the need for significant catalysts to boost sentiments. Investors are advised to focus on fundamentally justified stocks, as Nigeria’s economic story continues to evolve as a significant driver for corporate earnings.
Nigeria’s equities market, once in the shadows, has become a beacon of hope, illuminating a path to prosperity amidst global financial challenges.
Victor Ezeja is a passionate journalist with seven years of experience writing on economy, politics and energy. He holds a Master's degree in Mass Communication.
