Kayode Tokede

Despite macro-economic challenges, the Nigerian stock market has emerged one the top four best performing Exchanges in Africa with a Year-till-Date (YtD) investors returns of 39.44 per cent as of November 28.

THISDAY analysis of equities market performance in Africa showed that Malawi Stock Exchange (MSE), followed by Ghana Stock Exchange (GSE), and Lusaka Securities Exchange (LuSE) were the best performing Exchanges in Africa.  

MSE ASI  in its 2025 YtD growth stood at 259.98 per cent while GSE-CI and LuSE YtD performance growth stood at 76.13 per cent and 63 per cent, respectively.  

According to a report, MSE ASI has maintained a bullish run for the greater part of 2025, marked by rising share prices and trading activity. The report noted that  MSE ASI’s YtD performance underscores growing investor confidence in Malawi’s financial markets, driven by strong corporate earnings, high liquidity, and limited alternative investment channels amid double-digit inflation. 

Another  report stated that the surge in trading activity,combined with a over 127 per cent market cap-to-Gross Domestic Product (GDP) ratio, highlights deepening market participation and the growing role of equities in domestic wealth creation. 

Analysts attributed part of the momentum to increased institutional investment and resilient bank performance, supported by reforms in monetary policy and financial transparency. 

If current trends continue, the MSE ASI  could close 2025 as Africa’s best-performing Exchange for a second consecutive year, strengthening Malawi’s position as a standout frontier investment destination.

For GSE-CI, its 20255 growth is underpinned by an improving economy and strengthening cedi currency, while that of  LuSE ASI was driven by strong investor confidence and market momentum.  

Other Exchanges with an average returns over 30 per cent include:  Egypt Stock Market (EGX30),  34.63 per cent; Tunis Stock Exchange (Tunindex), 32.33 per cent and Johannesburg Stock Exchange (JSE) All-Share Index, 31.94 per cent. 

Further findings revealed that the Stock Exchange of Mauritius (SEM) All Share Index emerged as the only Exchange with a decline of 1.20 per cent in its YtD investors returns. 

To the Nigerian stock market, analysts have hinted on foreign investors inflow, banking sector recapitalisation exercise, impressive corporate earnings by banks, among others as the major drivers.

Following reforms in the foreign exchange market, transactions by  foreign and domestic investors on the Nigerian Exchange Limited more than doubled in the 10 months of 2025, reaching N9.57 trillion, a 114.01 per cent increase from the N4.47 trillion recorded in the same period of 2024.

NGX report disclosed that Foreign portfolio investors (FPIs) accounted for N2.03 trillion of total trades, a 172.4 per cent year-on-year rise from N744 billion a year earlier.

In terms of inflow, the report disclosed that foreign inflow stood at N1.12 trillion in 10 months of 2025 from N344 billion in 10 months of 2024, while outflow stood at N909.54billion in 10 months of 2025 from N400.04billion in 10 months of 2024.

The CBN recently implemented significant reforms in the foreign exchange market aimed at enhancing transparency, compliance, and market stability.

These reforms are part of the CBN’s broader strategy to create a fairer, more stable FX market and support economic growth through better monetary policies.

In tandem with these reforms, the CBN has also implemented aggressive monetary policy, with the goal of curbing inflation and stabilising the naira, a move supported by the International Monetary Fund (IMF).

Inflation rate, according to the National Bureau of Statistics (NBS) stood at 16.05 per cent as of October 2025 from 33.88 per cent October 2024, while MPR has dropped to 27.00 per cent as of November 2025 from 18.75 per cent November 2024.

With the foreign investors increasing participation in the stock market over naira policies of the current administration, capital raising exercise policy of CBN, among other reforms, the likes of BUA Foods Plc, Dangote Cement Plc, Guaranty Trust Holding Company  Plc, Zenith Bank Plc, among others have  appreciated in stock prices significantly.

With the 39.44 per cent YtD growth as of November 28, 2024, in the stock market, analysts have projected that the bourse is not expected to surpass its 37.65 per cent performance in 2024.

The stock market in 2024 had gained 37.65 per cent following President Bola Tinubu’s reforms, most especially in the foreign exchange unification and removal of fuel subsidies.

Responding to stock market performance, the Vice President, Highcap Securities Limited, Mr. David Adnori stated that, “trading on the Exchange this year is buoyed by renewed buying interest after a series of reforms that has attracted foreign investors amid impressive corporate scorecards by listed firms.”

He said many companies across various sectors posted impressive numbers, and the reforms by the Federal Government has begun to translate in the overall stock market performance this year. 

On market outlook in December 2025, Adnori said “we expect buying sentiments to continue as investors and bargain hunters react to December spending. Pullbacks are creating ‘buy’ opportunities amidst the economic reforms of the government, just as more policy pronouncements and economic managers hit the ground running, a situation expected to offer investment direction eventually.”