Macroeconomic Outlook 2024: Nigeria’s Stock Market Outperforms Globally Despite Challenges
In 2024, Nigeria’s capital market emerged as a shining star amidst a global landscape filled with economic uncertainties. The stock market ended the year among the top three best-performing markets worldwide, with a remarkable year-to-date return of 36.59%. This robust performance continues to highlight the resilience of Nigeria’s financial sector, despite facing significant macroeconomic reforms.
Key Highlights:
1. Stock Market Performance:
• The Nigerian stock market reached a significant milestone, surpassing 100,000 index points with a market capitalization of N62 trillion. The All Share Index (ASI) marked its fifth consecutive positive return, driven by strong sentiment in both debt and equities markets.
2. Banking Sector Growth:
• Over N1.5 trillion was raised in the first phase of banking recapitalization, revitalizing the primary equities market. Notable successes include Jaiz Bank raising N10.4 billion and Access Holdings surpassing the new capital requirement with N350.96 billion.
3. Government Debt and Foreign Investment:
• Nigeria’s debut Eurobond after two years, worth $2.2 billion, was oversubscribed by 300%, reflecting global confidence in Nigeria’s economic potential. Foreign Portfolio Investments (FPIs) surged, doubling from 2023 levels, and total FPI transactions reached N785.28 billion.
4. Foreign Exchange (Forex) Inflows:
• The forex market saw a strong rebound, with total inflows hitting $4.05 billion by November 2024, a 32.9% increase from October. This surge was driven by substantial contributions from both foreign portfolio investors and domestic sources.
5. Sector Developments:
• The year also witnessed major mergers and acquisitions, including Oando’s acquisition of Nigerian Agip Oil Company, while Seplat finalized its $1 billion acquisition of ExxonMobil, pushing oil and gas stocks to new highs.
6. Technological Innovation:
• NGX Invest, the electronic offering platform introduced by the Nigerian Exchange, simplified investing processes, making participation in the market more accessible, especially in underserved areas.
7. Regulatory Changes:
• The reconstitution of the Securities and Exchange Commission (SEC) under the new leadership of Chairman Mairiga Katuka and Director-General Dr. Emomotimi Agama marks a new phase in market regulation, with an ambitious $1 trillion economy agenda centered on the capital market.
Despite challenges such as fiscal and monetary reforms, the Nigerian capital market showcased exceptional resilience and growth, positioning it as a beacon of opportunity in uncertain times.
In 2024, Nigeria’s capital market emerged as a shining star amidst a global landscape filled with economic uncertainties. The stock market ended the year among the top three best-performing markets worldwide, with a remarkable year-to-date return of 36.59%. This robust performance continues to highlight the resilience of Nigeria’s financial sector, despite facing significant macroeconomic reforms.
Key Highlights:
1. Stock Market Performance:
• The Nigerian stock market reached a significant milestone, surpassing 100,000 index points with a market capitalization of N62 trillion. The All Share Index (ASI) marked its fifth consecutive positive return, driven by strong sentiment in both debt and equities markets.
2. Banking Sector Growth:
• Over N1.5 trillion was raised in the first phase of banking recapitalization, revitalizing the primary equities market. Notable successes include Jaiz Bank raising N10.4 billion and Access Holdings surpassing the new capital requirement with N350.96 billion.
3. Government Debt and Foreign Investment:
• Nigeria’s debut Eurobond after two years, worth $2.2 billion, was oversubscribed by 300%, reflecting global confidence in Nigeria’s economic potential. Foreign Portfolio Investments (FPIs) surged, doubling from 2023 levels, and total FPI transactions reached N785.28 billion.
4. Foreign Exchange (Forex) Inflows:
• The forex market saw a strong rebound, with total inflows hitting $4.05 billion by November 2024, a 32.9% increase from October. This surge was driven by substantial contributions from both foreign portfolio investors and domestic sources.
5. Sector Developments:
• The year also witnessed major mergers and acquisitions, including Oando’s acquisition of Nigerian Agip Oil Company, while Seplat finalized its $1 billion acquisition of ExxonMobil, pushing oil and gas stocks to new highs.
6. Technological Innovation:
• NGX Invest, the electronic offering platform introduced by the Nigerian Exchange, simplified investing processes, making participation in the market more accessible, especially in underserved areas.
7. Regulatory Changes:
• The reconstitution of the Securities and Exchange Commission (SEC) under the new leadership of Chairman Mairiga Katuka and Director-General Dr. Emomotimi Agama marks a new phase in market regulation, with an ambitious $1 trillion economy agenda centered on the capital market.
Despite challenges such as fiscal and monetary reforms, the Nigerian capital market showcased exceptional resilience and growth, positioning it as a beacon of opportunity in uncertain times.