Despite the head- winds that assailed the economy in the preceding year, 2025, experts say the economy was able to deliver some tangibles, while expressing cautious optimism for 2026. Professor of Capital Market, Uche Uwaleke, notes the strong footings with which the capital market drew the curtains on 2025.
He said: “The curtains closed in 2025 with the Nigerian stock market delivering a performance that not only defied expectations but etched its name into the annals of history. The Nigerian Exchange AllShare Index (ASI) posted a full-year return of 51.19 per cent- its strongest showing in nearly two decades.
The bull run propelled the equities market capitalisation to the cusp of the N100 trillion mark, a psychological and symbolic milestone that underscores the market’s growing depth and rising investor confidence. “This remarkable performance placed Nigeria among the best-performing equity markets globally in 2025, outperforming most emerging and frontier peers, where equity returns largely remained in the low-to-mid teens amid lingering geopolitical tensions, tight financial conditions earlier in the year, and uneven global growth.
Comparable historical performances in Nigeria were last recorded in 2020 (50.0 per cent), 2013 (47.2 per cent), 2023 (45.9 per cent), and 2017 (42.3 per cent), underscoring just how exceptional 2025 turned out to be.” On the 2026 outlook, he forecasts cautious optimism. Uwaleke said: “Overall, the outlook for the Nigerian stock market in 2026 is cautiously optimistic.
While the market may not replicate the extraordinary returns of 2025, the structural reforms underway, improving macroeconomic fundamentals, anticipated major listings, and recapitalisation driven activity provide a solid foundation for sustained growth.” For investors, Uwaleke said the year 2026 is likely to reward selectivity over exuberance.
“The era of indiscriminate rallies may give way to more differentiated performance driven by earnings quality, balance-sheet strength, and sectoral positioning. Banking, insurance, and select consumer goods stocks remain at- tractive, while additional opportunities may emerge from recapitalisation induced corporate actions and new listings.
Therefore, in navigating what remains a VUCA volatile, uncertain, complex, and ambiguous- environment, my long-standing investment counsel remains relevant: Diversification, prudent hedging, and a long-term perspective (the DHL approach).
Investors who align their strategies with Nigeria’s ongoing market transformation, rather than short-term noise, are more likely to preserve capital and generate sustainable returns in 2026 and be- yond,” he stated. In his submission, Dr. Ilya Aliyu, an Abuja-based Economist, tied the eco- nomic performance of 2025 to the 2024 spillover.
“Looking at the 2025 economy, I think it’s a relief from what we experienced in 2024. You could recall that 2024 was so difficult for people to actually bet- ter their lives in terms of the basic economy. Food prices were up, increases were unprecedented, and a lot of things were difficult to do. 2025, I think, came with relief.
And we have seen that for eight months consecutively. We saw the inflation coming down; we also saw the price of food coming down. Even though the demand side is having problems, people do not really have money to buy things, but they are available in the market”, he said. Aliyu said the reform of the macro economy has not reflected in the lives of people because of the lag time and outlier effect, a scenario where inflation is coming down, you don’t see the results.
On the forecast for 2026, Aliyu described the 2026 budget as the most moderate budget so far. He said, “Because if you look at 2024 and 2025, they were overambitious, and what happened? The fact that you could not have a lot of revenue to meet expenditure.
But from what we are seeing in the budget, I think there is more, much more capital. “Capital budget is higher, it’s about N26 trillion and that shows it will benefit more Nigerians, as you know, they actually rolled over budget capital expenditure of about 70%. But be as it may, looking at 2026 as a context, on its own, the budget is okay, provided we can make the expected revenue.
Because if you don’t make the reve- nue, it’s going to affect the capital expenditure again, because by January 1st, the recurrent expenditure will start running, even though they have to go and collect means, and we must also pay our debt services, be- cause it’s an obligation, without hesitation. So let’s be hopeful, maybe around the first quarter of the year.”
There’ll be a repeat of the 2006 rapid economic expansion
Teriba A foremost Nigerian economist and Chief Executive Officer of Economic Associates, Dr Ayo Teriba, has said that Nigeria is set to witness a rapid eco- nomic expansion in 2026, similar to what the country experienced in 2006. He, however, cautioned the Federal Government against making promises it cannot adequately fund.
Dr Teriba stated this on Friday while appearing as a guest on Arise Television’s Morning Show, where he noted that although the global economy is projected to slow down slightly, Nigeria’s economy is expect- ed to grow significantly.
“The outlook for Nigeria in 2026 should be better than what the government itself is projecting. Multilat- eral agencies have actually projected a better growth outlook for Nigeria than for the global economy.
“While the world economy is projected to decline, Nigeria’s growth projection is being revised upward, and that is a positive starting point,” he said. According to him, the economic outlook for Nigeria in 2026 would be similar to that of 2006, a period marked by rapid growth.
“It is expected that the Nigerian economy this year will resemble that of 2006, about 20 years ago, when the stock market increased fivefold, the naira gained strength, and growth accelerated, before everything hit the wall in 2008 and 2009 due to the global financial crisis.
“2026 will be a repeat of 2006. We should expect rapid tranquillity and expansion on all fronts. While the 2006 boom was largely driven by favourable global commodity prices and luck, this one is policy-induced,” he explained. He added that the major gains so far have come from improved exchange rate stability and declining inflation, particularly in the latter part of 2025. Speaking further on inflation, Teriba projected that inflation would drop to a single digit by January 2026. “The last inflation read- ing as of November was about 14.45 per cent.
I expect the next reading to be around 12 per cent, and by January, which will be announced in February, inflation should drop to a single digit. “If inflation hits single digits at the beginning of the year, then we should expect it to remain in single digits for the rest of the year,” he said.
He stressed that declining inflation would help stabilise the exchange rate, noting that although the naira depreciated sharply in the past, it is now on a downward correction path. “Two years ago, it was projected that the exchange rate would be around N800 to a dollar, but it eventually reached N1,600.
Today, it is coming down; hovering around N1,500 or N1,400, and it could reduce further to as low as N800,” he said. However, the economist warned the government against making unfunded commitments, saying such actions only give citizens false hope.
“Any government that cannot fund a pronouncement should not make that pronouncement,” he said. He cited the post COVID-19 promise by the previous administration to create 1,000 jobs in each of the 774 local governments, which he said was never implemented due to a lack of funding.
“President Bola Tinubu has barely spent two years in office. I am not saying this to criticise him, but to encourage realism. The government was unable to fully fund the 2024 capital budget, and implementation of the 2025 capital budget has not been completed, yet more promises are being made.
“Unless the government can generate the projected N40 trillion revenue for 2025 to fund capital projects, it should not be talking about 2026. Without credible revenue sources, especially foreign direct investment, this will be difficult to achieve.” According to him, the only viable way to generate N50 trillion in revenue is through massive foreign investment.
“That is how countries like Saudi Arabia, India, and Brazil moved forward,” he said. Teriba further noted that Nigeria possesses even more assets than Saudi Arabia, adding that the country’s population is about six times larger. “Nigeria has numerous cities with enormous wealth potential, but these assets are not being properly unlocked by the government,” said.
Nigeria may transition from stabilisation to growth
Yusuf Commenting on the economy’s performance, the Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, stated that against the backdrop of the turbulence associated with the early phase of the Federal Government’s reforms, the year 2025 laid a strong foundation of macro-economic stability for the country.
According to him: “Exchange-rate stability emerged as the most visible achievement, with the naira largely trading with- in the N1,440–N1,500/US$ band. Periodic marginal appreciation strengthened business confidence, eased imported inflation, and restored predictability to pricing, contracting, and investment planning.”
He also highlighted a sharp drop in inflation from 24.48 percent in January to about 14.45 percent by November 2025, which he noted was supported by factors such as naira stability, easing logistics pressures, and improving supply conditions.
On the FG’s fiscal performance in 2025, Dr. Yusuf said that despite macroeconomic stabilisation, the federal fiscal performance remained weak, adding that: “Debt-service obligations continued to constrain fiscal space, undermining budget execution.
Revenue underperformance persisted, largely reflecting sub-optimal oil sector performance.” He also noted that the FG significantly fell short of its projected N41 trillion revenue target for 2025, thereby leading to weak capital expenditure implementation.
Commenting on the CPPE’s 2026 economic outlook, he said that if the FG sustains the momentum of its economic reforms, the country will “transition more decisively from stabilisation to growth.” He stated: “GDP growth is projected be- tween 4.0 and 4.5 percent, supported by continued moderation in inflation and stronger non-oil sector performance.
“Moderating inflation should strengthen domestic demand and create room for gradual monetary easing, potentially lowering interest rates and stimulating private investment. Services especially telecommunications, finance, construction, real estate, and trade will remain the primary growth engine.”
Furthermore, he predicted that the capital market would be boosted by the potential listing of the Dangote Refinery, which, according to him, “could deepen market liquidity and attract domestic and foreign portfolio inflows.”
The CPPE boss, however, pointed out that factors such as security challenges, debt and fiscal pressures, volatility in the oil sector, pre-election pressures, as well as external head-winds could undermine the expected positive performance of the economy in 2026.
“The outlook for 2026 is reassuring, with expectations of stronger growth, easing inflation, improv- ing investor confidence and a gradual shift toward more inclusive expansion. If reform momentum is sustained and security challenges are effective- ly addressed, 2026 could mark the beginning of a more robust growth phase with tangible improvements in living standards,” Dr Yusuf stated.
Stakeholders project stronger Capital Market expansion
Stakeholders in Nigeria’s capital market have expressed strong optimism about the outlook for 2026, projecting deeper capital formation, expanded listings and increased investor participation as reforms, technology adoption and regulatory initiatives con- verge to support long-term growth and economic development.
The Group Managing Director and Chief Executive Officer of the Nigerian Exchange Group, Temi Popoola, said the Nigerian capital market in 2026 will be shaped by deliberate efforts to deepen its capacity for long-term financing and capital raising.
He explained that ongoing economic reforms and sustained improvements in market infrastructure are expected to translate into broader investor participation, increased listings and stronger trading activity across equities, fixed income and alternative asset classes.
According to Popoola, these developments will further entrench the capital market as a critical channel for funding Nigeria’s economic priorities, including infrastructure development, industrial growth and private sector expansion.
He noted that with government finances under pressure, the capital market will increasingly play a central role in mobilising domestic and foreign capital to support sustainable development. He added that sustained policy consistency, transparency and collaboration among market stakeholders will be essential to unlocking the next phase of growth.
Technology, Popoola said, remains a central pillar of the 2026 outlook. He explained that digital innovation will continue to drive product development, data-driven decision-making and financial inclusion, enabling more issuers and investors to participate efficiently in the market. According to him, continued investment in trading platforms, post-trade infrastructure and market data solutions will improve efficiency, reduce costs and enhance investor confidence.
He also stressed the importance of partnerships, noting that NGX Group will intensify collaboration with regulators, issuers, market operators, policymakers, and the wider financial ecosystem to sustain growth momentum.
Adonri: Market delivered strong returns
In a similar vein, David Adonri, Vice Chairman of Highcap Securities, said the market delivered a second consecutive year of strong returns, reinforcing its role as a key engine of economic recovery.
He noted that the strong performance recorded in 2025 has boosted investor confidence and strengthened the market’s appeal as a viable long-term investment destination. Looking ahead, Adonri projected that equity market capitalisation on the Nigerian Exchange could rise toward N300 trillion in 2026 from about N100 trillion currently, provided anticipated mega listings materialise and investor appetite remains strong.
He said expectations of new listings from large corporates and infrastructure-related entities could significantly expand the depth and breadth of the market. Adonri added that macro-economic improvements, particularly enhanced security conditions and the containment of insurgency and banditry, could unlock eco- nomic activity across key sectors such as agriculture, manufacturing and logistics.
This, he said, would translate into stronger corporate earnings and sustained investor interest. However, he cautioned that unresolved issues around Capital Gains Tax could dampen sentiment if not addressed promptly, stressing that investors require certainty and consistency in the tax and regulatory environment to commit long-term capital.
Meanwhile, the Director-General of the Securities and Exchange Commission, Emomotimi Agama, said the Commission is prioritising the mobilisation of long-term capital in 2026 to bridge Nigeria’s infrastructure and sectoral gaps.
He disclosed that the SEC will facilitate the issuance of infrastruc- ture bonds, green bonds, municipal bonds, and infrastructure focused funds, while also promoting agribusiness listings and commodities linked instruments to de risk agriculture, strengthen food security, and broaden wealth creation opportunities across the economy.
