Outlook of The Nigerian Stock Market in 2026

Outlook of The Nigerian Stock Market in 2026

The performance of Nigeria’s equity market throughout 2025 suggests that the economy is finally reacting positively to the structural reforms implemented over the past two years. We have seen a substantial bull run; as the economy’s primary barometer, the stock market is typically the first to signal a recovery.

Because it recalibrates prices rapidly and functions as an effective inflation hedge, “smart money” consistently migrated to this space during periods of rising prices.

The data illustrates a compelling narrative. By the end of 2025, the market delivered a 51.19% return, marking one of its strongest years in recent memory.

The Composite All-Share Index hit a record peak of 155,613 basis points, with market capitalization nearing the N100 trillion threshold.

These figures are extraordinary for an economy navigating such intense structural transitions.

Importantly, this expansion is diversified across various sectors, including Industrials, Consumer Goods, and Insurance.

Even the Banking sector has shown remarkable endurance despite heightened regulatory scrutiny, new recapitalization mandates, and a strategic shift away from foreign exchange-led gains.

Market fundamentals have strengthened to the point where 2026 could potentially equal or exceed last year’s results, provided no external shocks occur. This momentum is fueled by two pivotal government actions: the alignment of the Naira with market forces and the elimination of fuel subsidies.

These initiatives initially caused a price surge, driving inflation to 30% at the beginning of 2025. This represented the “bitter pill” necessary for economic health; the subsequent hardship was largely a consequence of delaying these choices for decades.

While the public continues to adapt to these changes, the corrective advantages are beginning to solidify.

Nigeria now possesses a functional FX market, with monthly trading volumes reaching $8 billion, or roughly $100 billion annually. This volume is more than double the nation’s current reserves of $45 billion.

Today, foreign currency is accessible to meet demand, and the market features a more diverse and liquid pool of sellers than ever before.

In a landmark shift, crude oil has dropped from accounting for 80%–90% of foreign exchange earnings to just about 25%. This change isn’t due to a collapse in oil revenue, but rather the significant growth and contribution of other sectors to the FX pool.

A market-reflective Naira has turned local producers into global competitors. Consider “Titi,” a fashion designer in Owo who exports to clients in the UK and the US. With traditional Nigerian attire becoming a staple at diaspora events, she now generates approximately $400,000 annually in her domiciliary account.

In the past, exporters like Titi hoarded dollars in anticipation of further Naira depreciation. Now that the currency has stabilized, she settles her transactions by selling her dollars to the bank immediately.

Many of these private, peer-to-peer transactions bypass official export records but contribute significantly to national liquidity.

Because the Naira is gaining strength, there is a rush among exporters to convert their foreign holdings. Reports indicate that over $200 million from domiciliary accounts is converted into Naira daily. Furthermore, Nigerian consumer goods companies are utilizing AfCFTA to become low-cost leaders in Africa.

They are successfully exporting household brands to nations like Gabon, Uganda, and Tanzania, challenging established imports from Europe.

Additionally, a cocoa boom is underway, with Nigeria challenging Ivory Coast and Ghana for regional leadership in production. Various other agricultural commodities have also joined the list of regular exports, bringing in consistent dollar revenue and further stabilizing the FX market.