In 2024, the Nigerian capital market stood as a testament to remarkable resilience and adaptability, defying macroeconomic challenges and policy shifts to carve out a year of transformation. Despite the hurdles of inflation, high production costs, and a volatile economic landscape, industry analysts were quick to point to the market’s robust performance and its future potential. The year was defined by strategic policy changes, corporate actions, and a resurgence in primary market activities that collectively helped shape a promising direction for the market.
Market performance was stellar, with the Nigerian Exchange (NGX) recording a 35.28 percent return in January, signaling a positive start. As of December 27, the market capitalisation hit N61.912 trillion, up from N40.918 trillion at the beginning of the year. This growth was not just a reflection of strong investor confidence but a symbol of the Nigerian capital market’s potential as one of the leading global exchanges in terms of return.
By November, total domestic and foreign portfolio transactions reached N4.913 trillion, marking a 47.12 percent increase compared to the previous year. Foreign transactions were notably strong, standing at N785 billion, more than double the figure from the year before. While the market saw fluctuations, domestic transactions continued to dominate, reflecting the cautious optimism of local investors amid concerns about currency volatility.
A key factor in the market’s success was the Central Bank of Nigeria’s (CBN) directive for banking sector recapitalisation. The policy spurred a wave of capital-raising activities, including hybrid offers and rights issues, injecting liquidity into the market and invigorating investor interest. Banks such as First Bank, UBA, Fidelity, and Zenith played pivotal roles in this rejuvenation, boosting overall market liquidity and spurring positive growth.
Another important catalyst for growth was the liberalisation of foreign exchange (FX) and energy pricing. These reforms, though controversial due to their inflationary effects, bolstered investor confidence and transparency, making Nigeria a more attractive investment destination. At the same time, technological advancements, particularly in digital asset regulation and market operations automation, played a crucial role in maintaining market stability and encouraging investor protection.
The recapitalisation policy not only revitalised the financial sector but also reinvigorated the primary market. Additionally, Nigeria saw the issuance of its first U.S. dollar-denominated domestic bond and a return to the Eurobond market by the Federal Government, further underscoring the market’s growth potential.
Despite a successful financial sector, challenges persisted in the real economy, where inflation and high production costs took a toll on companies in manufacturing and consumer goods. Major companies like GlaxoSmithKline and Flour Mills of Nigeria were forced to exit the market due to unsustainable operational costs, highlighting the strains faced by real-sector companies.
Looking ahead, analysts are optimistic for 2025, predicting a more stable macroeconomic environment and continued strong performance across key sectors. The liberalisation policies and the anticipated passage of the Investments and Securities Bill (ISB) are expected to further strengthen the regulatory framework, encouraging more foreign investments and increasing market transparency. The financial, oil and gas, and industrial goods sectors are set to be major beneficiaries of these reforms.
With a promising outlook for the coming year, industry experts believe that 2025 will build on the momentum generated in 2024. Stakeholders are eager to see more activities from both local and foreign investors, with expectations of significant market impact as the capital market continues to evolve and expand. As one expert put it, 2024 was about laying the groundwork, and 2025 is set to be a year of even greater market achievements.