Stock Market Ends July with N12.62tn Surge, Reflecting Investor Optimism

The Nigerian Exchange Limited (NGX) wrapped up July on a bullish note, recording a remarkable gain of ₦12.62 trillion in market capitalization, as investors showed renewed confidence in the equity market amid policy reforms and strong corporate earnings. The surge in value marked one of the most robust performances by the Exchange in recent months, driven by sustained interest in blue-chip stocks and increasing participation from both domestic and foreign investors.

At the close of trading on the final day of July, the NGX’s market capitalization climbed to ₦59.24 trillion from ₦46.62 trillion recorded at the beginning of the month. This represents a monthly appreciation of 27.1 percent, signaling a significant recovery from earlier market corrections and setting a promising tone for the rest of the third quarter. Market analysts attributed the rally to positive investor sentiment, macroeconomic reforms, and expectations surrounding the upcoming earnings season.

One of the key highlights during the month was the impressive performance of stocks in the banking, consumer goods, industrial, and oil and gas sectors. Tier-one banks such as GTCO, Zenith Bank, Access Holdings, and UBA led the charge, benefiting from strong earnings reports and improved investor appetite for financial stocks. The consumer goods segment also gained traction, particularly with the surge in demand for shares of Nestle, Dangote Sugar, and BUA Foods, which posted robust half-year results.

The All-Share Index (ASI), the benchmark indicator for the Nigerian stock market, closed the month at 105,085.25 points, up from 100,057.49 points at the beginning of July. This 5.02 percent increase in the ASI reflects the general upward trend and growing investor interest in equities, despite economic headwinds such as inflation and currency volatility. The market breadth remained positive for most of the month, with more gainers than losers across trading sessions.

Investor confidence was further bolstered by recent policy interventions from the Central Bank of Nigeria (CBN), particularly in the areas of foreign exchange liberalization and interest rate adjustments. These moves were interpreted as signs of the government’s commitment to fiscal and monetary stability. Market watchers noted that the clearer policy direction encouraged portfolio rebalancing, with fund managers shifting more capital into equities, especially stocks with strong fundamentals and attractive valuations.

Additionally, the sustained inflow of foreign portfolio investment into the Nigerian market played a pivotal role in driving up market capitalization. Many offshore investors, previously wary of Nigeria’s policy uncertainty, began returning as confidence improved, drawn by the potential for high returns amid the relative undervaluation of Nigerian equities. The NGX’s renewed engagement efforts with global investors also contributed to this trend.

A string of successful corporate actions further energized the market. Dividend announcements, share buyback programs, and bonus issuances by several listed companies provided additional incentives for investors to take positions or increase their holdings. These corporate moves not only created value for shareholders but also demonstrated the financial strength of companies operating in key sectors of the economy.

In terms of trading activity, the average daily turnover on the Exchange saw notable improvement compared to June. The volume and value of transactions increased consistently throughout the month, suggesting higher liquidity and deeper participation across the board. Retail investors also became more active, supported by easier access to trading platforms and growing financial literacy.

Looking ahead, analysts expect the market’s bullish momentum to persist into August, particularly as more companies release their half-year earnings. However, they cautioned that the sustainability of this upward trend would depend on macroeconomic indicators, especially inflation, exchange rates, and the government’s continued efforts at fiscal discipline. Global market conditions and geopolitical tensions could also influence investor behavior in the coming weeks.

Meanwhile, NGX management expressed satisfaction with the market’s performance, emphasizing its role in driving capital formation and wealth creation. A spokesperson for the Exchange stated that recent reforms in the capital market ecosystem, including regulatory enhancements and the introduction of new products, were beginning to yield positive results. He added that the NGX would continue working with stakeholders to strengthen the investment climate and attract more listings from high-growth sectors.

 

As the Nigerian Exchange steps into August with strong momentum, stakeholders are optimistic about sustained growth. The positive trajectory in July, characterized by broad-based gains and increased market activity, suggests that the Nigerian capital market is positioning itself as a viable destination for investment in a rapidly changing economic landscape. Investors, however, are advised to remain cautious and adopt sound portfolio management strategies to navigate possible market corrections.