The Nigerian stock market recorded a notable week-on-week decline following a sell-off by institutional investors over the proposed Capital Gains Tax (CGT) reform, expected to take effect in January. Investor concerns pushed the Nigerian Exchange Limited (NGX) All Share Index down by 1.7%, closing at 147,013.59 points last Friday from 149,524 points the previous week. Market capitalization fell by over N1.497 trillion, settling at N93.501 trillion from N94.998 trillion.
The market, however, showed signs of recovery after Finance Minister and Coordinating Minister of the Economy, Wale Edun, met with capital market operators and assured them that their concerns regarding the new tax reform would be addressed. The minister’s assurances restored investor confidence, driving a rebound from Wednesday through Friday and fueling optimism among both institutional and retail investors.
Trading activity last week surged compared with the prior week, with 7.325 billion shares valued at N156.425 billion exchanged in 134,383 deals, up from 3.575 billion shares worth N107.011 billion traded in 146,429 deals the previous week. The Financial Services sector led trading by volume, accounting for 6.497 billion shares worth N87.381 billion in 56,148 deals, representing 88.69% and 55.86% of total equity turnover volume and value, respectively. The Consumer Goods sector followed with 180.775 million shares worth N12.015 billion, while the Services sector recorded 138.365 million shares worth N2.402 billion.
Top traded equities by volume—Cornerstone Insurance Plc, Access Holdings Plc, and Zenith Bank Plc—accounted for 4.752 billion shares worth N41.132 billion in 14,304 deals, representing 64.87% of total turnover volume and 26.29% of turnover value.
Analysts at InvestData Consulting noted that renewed buying interest was supported by improved liquidity conditions in the money market and expectations that the Central Bank of Nigeria (CBN) may maintain its monetary policy rate, preserving price stability while supporting credit flow to productive sectors. Investors were also encouraged by indications of increased government fiscal activity, which could stimulate private sector performance and enhance company revenues in the coming quarters.
The market’s rebound underscores the sensitivity of investors to policy changes while highlighting the resilience of key sectors in the Nigerian economy.