NGX Delivers N61.13tn Gains As Equities Surge 61% In Five Months

The Nigerian equities market posted one of its strongest rallies in recent history in the first five months of 2026, delivering an estimated N61.13tn in capital gains to investors as banking sector recapitalisation, improved corporate earnings, and heightened investor participation boosted confidence across the market.

Data from the Nigerian Exchange Limited (NGX) showed that the benchmark All-Share Index (ASI) surged by 61 per cent year-to-date, rising from 155,613.03 basis points at the beginning of January to a historic high of 250,385.47 points at the close of trading in May.

Similarly, market capitalisation expanded significantly from N99.38tn to N160.51tn within the same period, representing a net increase of N61.13tn in investor wealth and underscoring growing confidence in the nation’s capital market despite prevailing macroeconomic challenges.

The rally was largely driven by ongoing banking sector recapitalisation mandated by the Central Bank of Nigeria (CBN), which introduced new minimum capital requirements of N500bn for international commercial banks and N200bn for national banks, with a compliance deadline fixed for March 31, 2026.

In response to the directive, several banks approached the capital market through rights issues, public offers, private placements, and listings by introduction in a bid to strengthen their capital base. Analysts noted that the fundraising activities injected substantial liquidity into the equities market and attracted both institutional and retail investors seeking investment opportunities.

Market operators and economic analysts attributed the sustained bullish momentum to a combination of regulatory reforms, declining yields in the fixed-income market, resilient corporate earnings, and improved domestic investor participation.

The Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, described the banking recapitalisation exercise as one of the most impactful policy initiatives in recent years, noting that it had generated significant positive spillovers for the capital market without causing the disruptions previously associated with similar exercises.

According to him, the ongoing recapitalisation programme has strengthened investor confidence while improving liquidity and market activity across the financial services sector.

Analysts also linked the market rally to falling yields on money market instruments, which declined below 2024 levels and prompted investors to redirect funds into equities in search of stronger returns and inflation hedging opportunities.

Strong earnings releases from listed companies, particularly within the banking and consumer goods sectors, further sustained investor appetite, while expectations of attractive dividend payouts continued to support buying interest.

Commenting on the market outlook earlier in the year, the Chairman of NGX Group Plc, Umaru Kwairanga, stated that the impressive performance of the market reflects the importance of policy consistency, macroeconomic stability, and regulatory clarity in driving long-term growth in the capital market.

He explained that the Exchange’s strategic priorities for 2026 are centred on deepening market liquidity, strengthening market integrity, enhancing resilience, and promoting coordinated reforms among regulators, issuers, investors, and other market stakeholders.

Kwairanga also encouraged investors to adopt long-term and diversified investment strategies while highlighting the increasing role of technology in broadening market access and participation across various investor categories.

He further noted that environmental, social, and governance (ESG) considerations are becoming increasingly important in attracting global capital inflows into emerging markets such as Nigeria.

Despite persistent economic headwinds including inflationary pressures, foreign exchange volatility, and political uncertainties, analysts said the market’s performance in the first five months of the year demonstrates strong underlying resilience and signals a positive outlook for the remainder of 2026, provided current reforms and investor confidence are sustained.

Meanwhile, the market closed the final trading week of May on a positive note, despite reduced trading activity owing to the Federal Government’s declaration of Wednesday, May 27, and Thursday, May 28, 2026, as public holidays to mark the Eid-el-Kabir celebrations.

Trading resumed for only three sessions during the week, with investors exchanging a total turnover of 2.398 billion shares valued at N111.48bn in 241,313 deals, compared with 3.875 billion shares worth N161.76bn traded in 334,745 deals in the preceding week.

At the close of the week, the NGX All-Share Index and market capitalisation appreciated by 0.27 per cent to settle at 250,385.47 points and N160.51tn respectively.

Sectoral performance was mixed as several indices closed lower. The NGX Banking Index declined by 2.43 per cent, while the NGX Consumer Goods Index shed 1.52 per cent. Other indices that recorded losses included NGX Premium, NGX Industrial Goods, NGX Growth, and NGX AFR Dividend Yield indices.

The Financial Services Industry dominated trading activity by volume, accounting for 1.656 billion shares valued at N48.23bn in 94,812 deals, representing 69.07 per cent and 43.26 per cent of the total equity turnover volume and value respectively.

The Services Industry followed with 265.45 million shares worth N4.53bn, while the Information and Communications Technology sector recorded 101.85 million shares valued at N9.16bn.

Trading in Fidelity Bank Plc, Access Holdings Plc, and The Initiates Plc accounted for a combined turnover of 903.68 million shares worth N19.23bn in 22,238 deals, contributing significantly to overall market activity during the week.

Market breadth remained negative as 51 equities recorded price declines, compared to 34 gainers, while 61 equities closed unchanged.