Nigeria’s stock market has emerged as the world’s best-performing equity market in dollar terms this year, recording a 67 per cent return and overtaking South Korea, according to a new report by Bloomberg.
The report, published on Thursday, ranked Nigeria first among 92 global stock exchanges monitored by Bloomberg, citing sustained economic reforms, improved foreign exchange liquidity, exchange rate stability and stronger investor confidence as key drivers of the market’s impressive performance.
According to Bloomberg, Nigeria’s benchmark equity index outperformed South Korea’s Kospi Index, which had earlier led global rankings after returning 66 per cent in dollar terms before sliding into a technical bear market. Ghana and Taiwan followed Nigeria and South Korea among the world’s top-performing equity markets.
The report noted that the turnaround in Nigeria’s capital market reflects growing investor confidence in the country’s macroeconomic outlook following a series of economic reforms aimed at stabilising the economy and attracting foreign investment.
Bloomberg said Nigeria’s equities have been supported by a combination of improved foreign exchange liquidity, a stronger naira and rising international crude oil prices, factors that have enhanced the attractiveness of Nigerian assets to both domestic and foreign investors.
The report further revealed that the naira has appreciated by about four per cent against the United States dollar since the beginning of the year, providing an additional boost to foreign investors by increasing dollar-denominated returns from Nigerian equities.
The improved performance also comes amid gradual stabilisation in Nigeria’s foreign exchange market following policy measures introduced by monetary authorities to improve liquidity, narrow exchange rate distortions and restore investor confidence.
In contrast, Bloomberg attributed South Korea’s decline to weakening investor sentiment surrounding artificial intelligence-related stocks, which had fuelled the country’s earlier stock market rally.
According to the report, South Korea’s Kospi Index has fallen about 22 per cent from its June 19 peak, meeting the threshold for a technical bear market as investors reassessed valuations of technology and artificial intelligence companies.
Bloomberg also noted that the depreciation of the South Korean won further eroded investor returns.
The currency has weakened by about five per cent against the US dollar since the start of the year, making it one of Asia’s weakest-performing currencies and reducing dollar-based gains from Korean equities.
By comparison, Nigeria’s stronger currency performance, improving macroeconomic conditions and increased foreign exchange availability have significantly enhanced the competitiveness of its capital market.
Market analysts say the latest ranking underscores the growing resilience of Nigeria’s equities market despite global economic uncertainties. They note that renewed foreign portfolio inflows, attractive corporate earnings, stronger market fundamentals and improving macroeconomic indicators have continued to support positive investor sentiment.
The Bloomberg report concludes that the combination of exchange rate stability, improved forex supply, supportive economic reforms and rising investor confidence has positioned Nigeria as the world’s best-performing equity market in dollar terms this year, reinforcing the country’s status as one of the most attractive investment destinations among frontier and emerging markets.
