Investors’ N4.35tr gain in one month boosts economy

Nigerian equities have amassed N4.35 trillion in net capital gains in the past five weeks.

The market report, now generally referred to as TinuBULL, followed a record-setting rally triggered by the investor-friendly stance of President Bola Tinubu’s administration.

Official trading reports and global stock market indices at the weekend showed that Nigeria has jumped several steps over the past five weeks to become one of the world’s three best-performing markets.

Nigeria’s benchmark equities index peaked at a 15-year high in a sustained bullish run driven by an upsurge in demand from both domestic and foreign investors.

There is a consensus that the performance of the Nigerian stock market is directly related to the policy stance of the Tinubu Administration.

The Nigerian Exchange (NGX) stated that the market performance came on the back of “audacious macroeconomic reforms under the 34-day old administration”, noting that market operators were of the view that “the policies of the new administration under President Tinubu” had “led to the rise in the fortunes of investors”.

In barely a month, the Tinubu Administration has given effect to the stoppage of the 46-year-old fuel subsidy, abolished the multiple forex rates and instituted probes into major issues of public finance.



In his May 29 inaugural speech, described generally as market-friendly, Tinubu addressed general issues of security, economy, infrastructure and monetary outlook.


The president also directly addressed investors’ concerns on multiple taxations, returns repatriation and foreign exchange (forex) among others.

“I have a message for our investors, local and foreign, our government shall review all their complaints about multiple taxations and various anti-investment inhibitions.

“We shall ensure that investors and foreign businesses repatriate their hard-earned dividends and profits home,” Tinubu said, directly addressing the global investing public.

Benchmark equities indices at the NGX indicated an average return of 15.09 per cent more than three-quarters of the equities market’s six-month return of 18.96 per cent for the first half of 2023.


The aggregate market value of all quoted equities has risen by N4.35 trillion over the past five weeks, accounting for about 82 per cent of total net capital gains of N5.33 trillion in the first half of 2023. These underlined that the global top chart performance of the stock market was largely driven by the Tinubu-triggered rally.


The All Share Index (ASI) – the value-based common index that is widely regarded as the main benchmark for the Nigerian equities market, rode on the back of a week-on-week rally to close at the weekend at 60,968.27 points, its highest since 2008.

The 60,000 index mark is regarded as a psychological milestone, a major testing point for a rally. The ASI had stood at 52,973.88 points on the eve of the May 29, 2023 swearing-in of the new president.


The aggregate market value of all quoted equities, which had stood at N28.845 trillion at the start of the Tinubu Administration, closed at N33.198 trillion, attaining a perfect correlation of 15.09 per cent with the ASI. The correlation between the ASI and market value validated that the increase in market value was driven mainly by share price appreciation or real capital gains as against increases due to the primary market’s changes in the number of listed shares and corporate revaluation among others.

The ASI and aggregate market value of quoted shares had opened in 2023 at 51,595.66 points and N28.103 trillion respectively.

A global year-to-date analysis that tracked major advanced, emerging and frontier markets at the weekend showed that Nigeria had climbed over the past five weeks to become the third best-performing market in the world, in terms of average return.

The report tracked 22 major global markets across the Americas, Europe, Asia, Middle East and Asia and drew on data provided by Bloomberg and Afrinvest West Africa.

With a year-to-date return of 18.96 per cent, Nigeria trailed Japan and Egypt, which posted a six-month average return of 27.2 per cent and 21.0 per cent respectively.

United States S & P 500 Index posted an average return of 15.8 per cent. United Kingdom’s FTSE All Share Index recorded a six-month return of 0.51 per cent. Germany’s Xetra Dax indicated an average return of 16.0 per cent. France’s CAC 40 Index posted an average gain of 14.3 per cent. China’s Shanghai Composite Index rose by 3.7 per cent while India’s BSE Sens appreciated by 6.4 per cent in the first half.

Trading reports at the NGX had shown early signs of a change in foreign investors’ attitudes to the Nigerian market.

The latest report on foreign portfolio investments (FPIs) indicated a significant improvement in foreign investors’ participation in the Nigerian investment market. Total FPI transactions rose by 338.72 per cent, driven by a significant 649.6 per cent increase in inflows.

The report, for the period, ended May 2023, showed that total FPIs increased from a record low of N8.47 billion in April 2023 to N37.16 billion in May 2023, its highest since June 2022. The total FPI in April was the lowest in recent years amidst anxieties over the political transition.

FPI inflow – the buy side of the transactions – jumped from a record low of N3.67 billion in April 2023 to N27.51 billion in May 2023, its highest since November 2021. FPI outflows – the sell side – recorded a slower increase of 101.04 per cent from N4.80 billion to N9.65 billion.

The FPI report, coordinated by the Nigerian Exchange (NGX), included transactions from nearly all custodians and capital market operators and it is widely regarded as a credible measure of the FPI trend. The report uses two key indicators-inflow and outflow, to gauge foreign investors’ mood and participation in the equities market and the economy. While inflows and outflows indicate the direction of portfolio transactions, total FPI measures the momentum and level of participation.

When inflows outweigh outflows, it simply means foreign investors are buying more quoted equities than they are selling and when outflows outpace inflows, it implies that foreign investors are selling more of their investments than buying more investments. Thus the position of FPI surplus or deficit.

The NGX noted that the May 2023 performance was partly driven by the record-breaking bullish rally triggered by the May 29 inauguration of President Tinubu, widely considered as a pro-market administrator.

A comparative analysis of the first trading day after the inauguration of a new president since 1999 had shown only three positive marks, with the 5.22 per cent rally posted by the stock market on the first trading day after the inauguration of Tinubu, the highest the market has ever witnessed. First-day equity market response to the 1999 inauguration of President Olusegun Obasanjo was negative, with the market dropping by 0.07 per cent.

The 2007 inauguration of President Umaru Musa Yar’Adua was almost flat, with a tilt towards positive. The 2011 inauguration of President Goodluck Jonathan was greeted with a modest 0.14 per cent. The 2015 inauguration of President Muhammadu Buhari was negative, with a first-day return of 0.77 per cent.

Afrinvest Securities said “economy reform optimism” bolstered the market performance, noting that “the rally in the market followed the promise of critical reforms by the President Bola Tinubu administration”.

Analysts at Arthur Steven Asset Management said the equities market’s bullish momentum was “because of the new administration which tends to affect the market positively”.

“The market reacted to the high expectation from the new administration as the government promised the investors easy repatriation of their investment and profit,” Arthur Steven Asset Management stated.

<<The Nation>>