Lagos — Approximately ₦170 billion was wiped off the value of the Nigerian stock market following a selloff in mid-cap equities, rattling investors despite renewed optimism generated by Nigeria’s recent sovereign credit rating upgrade by S&P Global Ratings.
The decline on the Nigerian Exchange Group came as investors engaged in profit-taking and repositioning amid continued economic uncertainty.
Analysts said the market reaction reflects lingering concerns over inflation, exchange-rate pressures, high interest rates, and weak consumer demand, even as international ratings agencies signal growing confidence in Nigeria’s reform trajectory.
The selloff occurred shortly after S&P upgraded Nigeria’s sovereign credit rating from ‘B-’ to ‘B’ — the country’s first rating upgrade in 14 years — citing economic reforms, improved oil-sector dynamics, foreign exchange liberalisation, and stronger external reserves.
The Tinubu administration has promoted the upgrade as evidence that recent reforms, including subsidy removal and exchange-rate unification, are beginning to stabilise the economy and restore investor confidence.
However, market analysts note that local investor sentiment remains cautious as businesses and households continue to face rising operating costs and broader economic pressures.
Observers say the latest market decline underscores the disconnect that can emerge between positive macroeconomic indicators and short-term realities within domestic financial markets.
Analysts add that sustained investor confidence will likely depend on whether ongoing reforms translate into lower inflation, improved corporate earnings, stronger purchasing power, and greater currency stability in the coming months.