The Nigerian equity market is currently basking in a historic rally, extending its winning streak to 18 consecutive trading sessions, a performance last seen over a decade ago.
The All-Share Index (ASI) rose by 0.53% on Monday, further consolidating the bullish momentum that kicked off on July 2nd, 2025. This run has seen the ASI soar by 12.9% in just under three weeks, breaking the 135,000-point threshold and pushing market capitalization beyond ₦85 trillion.
This surge is not a flash in the pan. It reflects a growing investor confidence in the Nigerian capital market, fuelled by a combination of strong corporate earnings, declining fixed income yields, and strategic sectoral rotations that have shifted market dynamics.
So far in 2025, the Nigerian Exchange (NGX) has recorded a 31.32% year-to-date gain, building on the 38% full-year return in 2024. This makes the NGX one of the best-performing markets globally, showcasing sustained investor appetite despite broader macroeconomic concerns.
Strong corporate results from listed companies, particularly in the banking and consumer goods sectors, have been a key catalyst for the rally. Many firms have reported improved bottom lines, despite earlier macroeconomic pressures such as currency depreciation and elevated inflation. Investors are responding to these improved fundamentals with renewed confidence.
Another major driver has been portfolio reallocation in response to the cooling yields in the fixed income market. With Treasury bill and bond yields declining, equities have become increasingly attractive for yield-seeking investors.
In addition, investors are betting big on consumer staples and FMCGs, hoping that companies in this space will begin to shake off FX-related losses sustained over the last two years. As exchange rate volatility stabilizes and input costs moderate, margins are expected to improve. So far, the consumer index has gained over 67% buoyed by the likes of Nascon and Nigerian Breweries.
Also, banks have benefited from the Central Bank’s recapitalization drive, which has sparked significant buying interest. The anticipated consolidation and capital raising efforts are seen as long-term positives for the sector, driving optimism among investors. YTD, the banking index gained 44%, with the likes of Stanbic IBTC and Zenith Bank printing returns of 73.2% and 59% respectively.
Meanwhile, the rally has also spread to the insurance sector, printing a YTD gain of over 25% as investor confidence spills over from the broader financial services space. Upcoming regulatory changes and recapitalization efforts are expected to improve industry resilience.
With the NGX riding high on strong earnings, robust investor sentiment, and sector-specific catalysts, the question now is whether this rally can be sustained through the second half of the year.
While some profit-taking is expected in the short term, especially after such an extended bullish run, the medium-term outlook remains positive, especially if macroeconomic indicators, such as inflation, FX stability, and interest rates, continue to trend favourably