Nigerian Equities Post World’s Second-Best Dollar Returns in 2026, Recover $21bn

Nigerian Equities Post World’s Second-Best Dollar Returns in 2026, Recover $21bn

Nigerian equities have emerged as one of the best-performing stock markets globally in 2026, delivering the world’s second-best dollar returns after years of currency-driven losses and weak investor sentiment. The local market has risen 31 percent in dollar terms this year, helping investors recoup about $21 billion in market value lost following the sharp naira devaluation in 2024.

Market capitalisation on the Nigerian Exchange Group has climbed to approximately $84 billion, representing a 58 percent increase from levels recorded before the currency collapse. According to Bloomberg, Nigeria’s benchmark equity index has surged 31 percent year-to-date, significantly outperforming global peers. The rally far outpaces the 11 percent gain in the broader emerging-market index and the 6.4 percent advance recorded by frontier-market stocks.

Analysts attribute the sharp rebound to a combination of stronger corporate earnings, exchange-rate stability, and renewed investor confidence following wide-ranging economic reforms. Olabode Williams, an analyst at SBG Securities Ltd, said companies hardest hit by the naira’s earlier collapse have now stabilised their balance sheets and returned to profitability. He noted that investors are increasingly pricing in growth as corporate fundamentals improve, adding that Nigerian equities are becoming more attractive to both local and foreign investors after years of underperformance.

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The rally has also been supported by a firmer naira, which has appreciated by more than seven percent against the dollar in 2026, ranking as the world’s second-best performing currency among those tracked by Bloomberg. The currency rebound has strengthened dollar-based equity returns and helped reverse losses triggered by earlier exchange-rate volatility.

Foreign participation has increased sharply alongside the rally. Data from the Nigerian Exchange Group shows that non-Nigerian trading in local equities reached a 19-year high in 2025. Transactions by foreign investors tripled to ₦2.65 trillion ($1.97 billion) from ₦852 billion in the previous year, reflecting renewed global appetite for Nigerian risk assets.

Market analysts believe the rally could extend further if major listings materialise. Gloria Fadipe, an analyst at CSL Stockbrokers Ltd, a unit of FCMB Group Plc, said the market could exceed $100 billion in valuation this year if large-scale listings proceed. She noted that potential listings of Dangote Refinery and Dangote Fertiliser could deliver capital gains of up to 34 percent while deepening market liquidity.

The rebound comes amid broader macroeconomic reforms introduced by Bola Tinubu, including the unification and liberalisation of the foreign-exchange market. While the reforms initially triggered volatility and inflationary pressure, economists say they are restoring policy credibility, improving capital inflows, and repositioning Nigerian assets for sustained long-term growth.

Nigerian Equities Post World’s Second-Best Dollar Returns in 2026, Recover $21bn