The Nigerian stock market is currently experiencing one of its most bearish periods of 2026, with the market shedding approximately 3.59% during the week.
Data from the NGX shows that the NGX All-Share Index and market capitalization declined by 3.59% to close the week at 235,941.27 points and N151.327 trillion, respectively.
As a result, investors lost a staggering N5.69 trillion in a single week, wiping out the entire N4.59 trillion gain recorded in May.
What the data is saying
The NGX All-Share Index closed April with a market capitalization of N155.994 trillion. By the end of May, market capitalization had risen to N160.59 trillion, representing a gain of N4.59 trillion and a month-to-date return of 3.24%.
- However, June has proven to be a difficult month for equities. With the market down 3.59% in just one week, capitalization has now fallen to N151.32 trillion.
- This means the market has lost roughly N9 trillion in the first three weeks of June alone, representing a month-to-date decline of 5.77%.
- Despite the recent selloff, the All-Share Index remains up 51.62% year-to-date, compared with a peak year-to-date return of about 60.9% recorded in May. The sharp decline means all the gains achieved in May have now been erased, with the possibility of further losses before the end of the month.
- The NGX also reported that only 11 equities appreciated in price during the week, compared with 40 in the previous week. Meanwhile, 78 equities declined, higher than the 53 recorded in the preceding week, while 57 equities remained unchanged compared with 53 in the prior week.
Among the biggest losers were First HoldCo and GTCO, which declined by 20.2% and 15%, respectively.
Why stocks are falling
Market intelligence gathered by Nairametrics from multiple capital market sources suggests the recent weakness in the equities market may be driven by three separate but related factors.
The first is profit-taking following an extraordinary rally that saw the Nigerian stock market gain more than 60% year-to-date at its peak.
After months of strong price appreciation, particularly in stocks that delivered triple-digit returns, many investors appear to be locking in gains.
The market is also contending with the ongoing dividend season, which has resulted in several stocks trading ex-dividend and being marked down accordingly.
Last week alone, UACN, Eterna Plc, FCMB Group, Airtel Africa, Dangote Cement, and Champions Breweries were marked down following dividend payments.
The previous week, Seplat Energy traded ex-dividend, while Julius Berger, Chemical and Allied Products (CAP), BUA Foods, and Jaiz Bank have also experienced similar adjustments in recent weeks. These markdowns have collectively weighed on the broader market index.
A second factor is half-year portfolio rebalancing by institutional investors.As the first half of the year draws to a close, fund managers are reassessing asset allocations and adjusting positions ahead of the second half of the year. This process often involves reducing exposure to equities and increasing allocations to fixed-income securities, particularly as yields remain attractive.
Investor appetite for government securities remains robust, with subscriptions for the latest one-year Treasury Bills auction exceeding N1.86 trillion as investors sought to take advantage of the 17.34% yield on offer.
The third factor relates to developments surrounding the Dangote Refinery private placement.
Market participants say some investors have been raising liquidity to participate in what is expected to be one of the largest corporate capital raises in Nigeria’s history.
Sources familiar with the transaction told Nairametrics that bids in excess of $5 billion were received, largely from high-net-worth individuals and institutional investors.
While a significant portion of the funding is believed to have come from offshore investors and domestic institutional pools, capital market sources who spoke on condition of anonymity indicated that some of the funds may have been sourced from existing stock market positions, contributing to selling pressure across selected equities.
What you should know
With N5.69 trillion wiped off market value last week alone, Nigerian stocks lost an average of about N1.14 trillion per trading day.
- On Friday, market capitalization declined by N938.75 billion to N151.33 trillion from N152.27 trillion recorded on Thursday, while the market’s year-to-date return moderated further to 51.62%.
- During the week, the Nigerian Exchange (NGX) also introduced new rules that could significantly change how share prices move on the exchange.
- Under the new framework, a minimum number of shares must be traded before the price of a stock can change. Trades executed below the prescribed threshold will not trigger a price movement.
Although the new rules are yet to materially impact market performance, many market participants believe they could become a significant factor in price discovery and the determination of share prices going forward.
