NGX In H1: NGX Delivers Best First Half in Six Years, Amid June’s N13 Trillion Correction

Nigeria’s stock market closed the first half of 2026 with one of its strongest six-month performances in years, handing investors trillions of naira in fresh wealth. But the rally’s final month told a more cautionary story, one of profit-taking, portfolio repositioning, and a market recalibrating after months of near-uninterrupted gains.

By the close of trading on June 30, the Nigerian Exchange’s All-Share Index stood at 229,419.18 points, up from 155,613.03 at the start of January, giving a year-to-date-return of 46.8%. Market capitalization climbed from N99.38 trillion to N147.218 trillion over the same period, a net capital gain of N47.84 trillion for investors holding NGX-listed equities. It ranks among the strongest first-half performances the exchange has recorded in the past six years, and it reinforces Nigeria’s standing as one of the best-performing equity markets on the African continent so far this year.

The market recorded its highest level, touching an all-time high of 252,508 points on May 13, 2026 and pushing total market capitalization to N160.09 trillion. At that point, the year-to-date return stood at 60.49% before the June correction set in, claiming more than 11% off the return. The June correction reflected one of the sharpest corrections in NGX history, attributed to sustained profit-taking and portfolio repositioning, wiping out roughly N13.3 trillion in market value in a single month, the largest monthly loss ever recorded on the exchange. This dragged the index down 8.28% from its May close and compressed the year-to-date return from that 60.4% peak to the 46.8% investors ultimately banked at the half-year close.

What Fuels The Rally

What made the first half remarkable was not simply the scale of the gains but how widely they were spread. Nearly every major sectoral index on the exchange finished the half in positive territory, a pattern analysts say reflects genuine macroeconomic improvement rather than speculation concentrated in a handful of stocks.

• Oil & Gas Index: up 90.2%, from 2,670.24 to 5,079.06 points, driven by strong buying interest in Aradel Holdings, Seplat Energy, and Oando.
• Industrial Index: up 79.0%, from 5,676.48 to 10,162.54 points, led by cement makers Dangote Cement and BUA Cement, both of which posted sharply higher pre-tax profits in the first quarter
• Banking Index: up 36.6%%, from 1,515.85 to 2,070.11 points, a performance tied directly to the sector’s ongoing recapitalization programme and resilient profitability even as the broader market wobbled in June
• Consumer Goods Index: up 15.6%, from 3,975.48 to 4,594.41 points, as companies with strong pricing power held onto gains despite persistent inflationary pressure
• Insurance Index: down 7.7 %, from 1,189.32 to 1,098.12 points, the only sector to finish the half in negative territory

Market participants point to structural reforms as much as corporate earnings in explaining the strength of the rally. The introduction of a T+1 settlement cycle, increased participation from local investors, and improved corporate fundamentals were repeatedly cited as key drivers.

Temi Popoola, Group Managing Director of Nigerian Exchange Group, has described the performance as evidence of growing confidence in Nigeria’s capital market and its economy, pointing to the country’s reform programme as a factor strengthening domestic capital formation.

Beneath that blue-chip story, though, sat a far more speculative one. A handful of low-priced, thinly traded stocks delivered extraordinary returns that had little to do with earnings and everything to do with momentum.

• Fortis Global Insurance, trading at just 20 kobo in January, posted gains exceeding 1,510% by June’s end
• Zichis Agro Allied Industries, an integrated agribusiness company, saw its share price surge more than 1,116% over the half, despite a regulatory-driven trading suspension along the way.
• SCOA Plc: up  365.459% to finish at N33.05 per share on June 30, up from N7.10 per share.
• Union Dicon Salt Plc rose +244% to N23.75, from N6.90
• Berger Paints  up 208% to N147.60, from N48.00
• RT. Briscoe rose by 184.29% to N9.95 per share, up from N3.50.
• Red Star Express Plc  up 182% to N24.55, from N8.70

These names illustrate a two-speed market: institutional money chasing fundamentals in banking, energy, and industrials, alongside a retail-driven momentum trade in micro-cap stocks that proved considerably more volatile when the correction arrived.

The Macro Picture Behind the Market

Nigeria’s equity rally was closely tied to the wider economy, and the same forces lifting stocks in Q1 began working against sentiment in Q2.

• Interest rates: The CBN cut its MPR by 50bps to 26.5% in February, its first easing in over two years, then held steady at 26.5% in May to protect disinflationary gains, keeping the CRR at 45% (deposit money banks) and 16% (merchant banks), with the standing facilities corridor unchanged at +50/-450 basis points.
• Inflation: Inflation fell for eleven straight months to 15.06% in February 2026, helped by tighter monetary policy, a stable exchange rate, and better food supply after the CPI rebasing. That progress reversed from March, as the Israel-Iran-US conflict pushed global oil prices up and raised domestic fuel, transport, and food costs — inflation climbed to 15.38% in March, 15.69% in April, and 15.93% in May, the highest reading since November 2025.
• Gross Domestic Product: GDP grew 3.89% year-on-year in Q1 2026, sustaining momentum from 2025 but falling short of the CBN’s 4.49% full-year target. External reserves held above $50 billion, covering close to ten months of imports, while the naira stayed broadly stable, with a projected H2 trading range of N1,350–N1,500/$1.

Outlook for the Second Half

Nigeria’s capital market enters H2 2026 with its fundamentals largely intact but a narrower margin for error than in January. Analysts say the market’s direction through year-end hinges on Q2 corporate earnings, progress on bank recapitalization, the CBN’s next rate moves, and whether the recent inflation uptick proves temporary or entrenched, much of which depends on factors outside Nigeria’s control. If the Middle East ceasefire holds and energy prices keep easing, inflation could moderate by late Q3, reopening the door to further rate cuts; if tensions reignite, the same fuel-and-transport channel that pushed inflation up in Q2 would likely resurface.

Domestically, the approach to the 2027 elections adds uncertainty, with higher government borrowing and election-related spending expected to push fixed-income yields up, a dynamic that could pull some investors out of equities before sentiment recovers. Overall, the outlook is one of cautious optimism rather than firm confidence: a market that proved it can deliver strong, broad-based gains, now being tested on whether it can hold onto them.