August 24, (THEWILL) — Nigeria may be experiencing a widening disconnect between booming equity market capitalisation and productive value creation. It is conventional wisdom that the equity market is the barometer of the economy. And this is true of the advanced economies: London, New York, Tokyo, Korea … These top Exchanges reflect the robust gross domestic product (GDP) performance and, of course, the ICE that drives the economy – investment, consumption and export.
In recent times, Nigeria has played in the league of global top-rated equity markets. It was the best in July 2026, but by August 14 South Korea had retaken the lead. Yet, Nigeria remained among the world’s strongest performers, with a dollar return of about 65.23 percent, according to Bloomberg data.
Aigbovbioise Aig-Imoukhuede, Managing Director, Coronation Asset Management, said Nigeria’s capital market is entering the second half of 2026 from a position of significantly stronger domestic participation, improved macroeconomic stability and renewed potential for international investor interest.
He noted that the NGX All-Share Index delivered a 57 percent return by the end of July 2026, while total market capitalisation increased by N58.9 trillion to N158.3 trillion during the first seven months of the year. The euphoria appears infectious.
Recently, the leadership of the Nigerian Exchange Group (NGX) and the Federal Government’s Economic Management Team (EMT) jointly called on President Ahmed Tinubu at Aso Rock Villa, Abuja, to update him with the sterling performance of the country’s stock market in the past few years. They all hailed President Tinubu, and attributed the good performance of the NGX to recent economic reforms.
The NGX Group Managing Director/CEO, Popoola, deploying some statistics, told President Tinubu that Nigeria’s equity market expects a N230 trillion market capitalisation by the end of the year.
He continued, “Mr. President, tied to all these is a lot of wealth that has been created for many people. We don’t have exact figures, but we estimate that about 500,000 to 900,000 millionaires have been created as a result of reforms,” he added. Popoola said other African markets are looking at Nigeria as a model for growing the stock market.
Popoola’s optimism is reinforced by the fact that many relatively dormant companies have more than doubled investors’ money through the NGX while productive sectors remain weak to the perplexity of many observers who are asking, ‘what exactly is the stock-market boom measuring?’
The underlying paradox is hinged to the fact that Nigeria’s equity boom may be generating enormous financial wealth for a few without yet demonstrating a corresponding expansion in productive capacity. The danger is that a market designed to mobilise savings for enterprise could increasingly become a machine for asset repricing, momentum trading and wealth transfer, contrary to what is being branded as nation-wide prosperity.
This is the point argued by an economist and sustainability expert, Marcel Okeke, who notes that investments in the real sectors are drying up while investors are stuffing their portfolios with capital market offerings—to minimize or hedge against numerous local and external headwinds. In a recent opinion article, Okeke presented an analogy that reflects the worrying paradox of Nigeria’s expanding equity market in a struggling economy.
“Some years ago, Chief Olu Falae, former secretary to the FGN had his large farm (in his home state of Ondo) vandalised and eventually burnt. According to reports, this happened twice; and on each occasion, some staff in the farms either got wounded or killed by the marauding bandits/terrorists/herders. Today, in retirement in his village, Chief Falae is no longer farming; but he remains an investor.”
The argument is that Falae may be among the multi-millionaires that have emerged from the reform construct, but a large number of people may have been rendered poor and unemployed – and may fall within the bracket of the large poor population indicated by the International Monetary Fund (IMF).
The IMF had acknowledged in June 2026, that conditions remained difficult for many Nigerians despite improvements in headline macroeconomic indicators. The Fund estimated that poverty had reached 63 per cent using the national poverty line and that 27 million Nigerians faced food insecurity in the fall of 2025.
However, industry experts insist that the equities market is for those who have the confidence and courage to invest. “It is those who invest that reap the dividends of the stock market rally,” said David Adonri, CEO of HighCap Securities Limited. He explains that the “few” that populate the equities market are those who will reap the benefits. Perhaps, this explains the great disconnect: Why Nigeria’s stock market Is booming while the real economy struggles.
Some industry analysts express worry that The NGX has delivered one of the world’s most spectacular rallies, minting trillions of naira in paper wealth, with some long-dormant, non-dividend-paying companies among the biggest gainers, triggering the question whether the boom reflects a genuine repricing of Nigeria’s productive capacity—or a growing divorce between financial markets and the real economy.
Mike Akannor, a finance expert said, “The central paradox is that a 100 percent return does not necessarily mean 100 percent more economic value. A share price is supposed to represent the market’s expectation of a company’s future cash flows. Therefore, a company can legitimately rise sharply even before its profits fully materialise. The market is forward-looking.” But the problem begins when price appreciation becomes detached from any credible change in earnings, assets, productivity, governance, market share or future cash generation.
Akannor cited a quoted company whose share price has delivered an extraordinary rerating in 2026. Yet available dividend records show its last recorded dividend payment was in 2015. Their 2025 accounts nevertheless showed a positive turnaround, including profit attributable to the period and a stronger equity position.
RT Briscoe presents a more complicated picture. Historical dividend records show its last recorded dividend in 2012, while the company’s 2023 annual report also contains references to unclaimed dividends from earlier years. Yet the company has recently shown significant operational improvement.
One 2026 market analysis, for example, reported strong revenue growth and argued that its rally could partly reflect a market reassessment of an undervalued turnaround story, although balance-sheet weaknesses remain.
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Aig-Imoukhuede observed that the equities market rally is driven by domestic investors indicating their increasing participation over foreign investors. He revealed at a media parley in Lagos on the H2 outlook that 57 percent of the NGX rally was driven by domestic capital not foreign inflow.
“The rally we have witnessed is not merely a market event. It reflects a stronger domestic capital base, improving macroeconomic stability and a growing opportunity for long-term investors who position thoughtfully for the second half of the year,” Aig-Imoukhuede said.
He added that the changing composition of market participation was an important indicator of resilience, particularly as domestic investors increasingly provide the capital needed to sustain market activity.
The concern expressed by many industry analysts is that Nigeria’s stock market is making money at a speed the Nigerian economy can scarcely recognise.
Companies whose shares had spent years on the margins of investor attention have suddenly become some of the hottest assets on the Nigerian Exchange. Stocks have doubled, tripled and, in some cases, delivered returns that would make the most successful technology companies on Wall Street envious.
Yet, outside the trading floor, the picture is strikingly different. Factories still contend with punishing electricity costs. Manufacturers face expensive credit and weak consumer demand. Millions of households remain trapped in a cost-of-living crisis.
Infrastructure gaps continue to raise the cost of doing business, while productive investment remains insufficient for an economy struggling to create enough jobs for its rapidly expanding population.
This is the contradiction at the heart of Nigeria’s spectacular equity rally. The Nigerian Exchange has created trillions of naira in market value and, at different points in 2026, emerged as the world’s best-performing stock market in dollar terms. But the explosive rise of the market raises a more uncomfortable question: how much of this new wealth represents an expansion in Nigeria’s productive capacity, and how much is simply the repricing of existing assets?
Sam Diala is a Bloomberg Certified Financial Journalist with over a decade of experience in reporting Business and Economy. He is Business Editor at THEWILL Newspaper, and believes that work, not wishes, creates wealth.
