Keypoints
- Prof. Uche Uwaleke, President of CMAN, asserts that Middle East tensions are unlikely to derail the Nigerian equities market due to its high domestic investor dominance.
- The market outlook for the remainder of 2026 remains “constructive,” driven by the successful banking recapitalization and the anticipated listing of the Dangote Refinery by Q3.
- The transition to a T+1 settlement cycle on May 29, 2026, is expected to be smooth, supported by robust infrastructure and new SEC capital requirements.
- Key growth drivers include stabilizing foreign exchange, moderating inflation, and gross external reserves which have reached approximately $50 billion.
Main Story
The Nigerian stock market is expected to remain resilient in the face of escalating global geopolitical tensions.
Prof. Uche Uwaleke, President of the Capital Market Academics of Nigeria (CMAN), told the News Agency of Nigeria (NAN) that the domestic orientation of the local bourse acts as a primary insulator against shocks like the U.S.-Israel-Iran conflict.
Unlike frontier markets heavily reliant on foreign portfolio flows, the Nigerian Exchange (NGX) is currently powered by local institutional and retail investors who prioritize domestic economic narratives over global volatility.
Uwaleke highlighted several internal “catalysts” that will likely define the market’s trajectory through Q2 and beyond.
The most significant is the potential listing of the Dangote Refinery before the end of September, which he believes will deepen market liquidity and attract a new wave of capital. Additionally, the banking sector—particularly Tier-1 banks—is poised for a strong performance as investors react to post-recapitalization growth strategies and improved earnings visibility.
The Issues
The transition to a T+1 settlement cycle (settling trades one day after execution) on May 29 remains a critical technical milestone. While Uwaleke expressed confidence in the market’s readiness, the primary challenge will be the “initial adjustment” for brokers and custodians navigating faster liquidity turnarounds. Furthermore, while the market is “insulated,” it is not “immune.” Uwaleke warned that monetary tightening by the CBN—should inflation surprise on the upside—and aggressive profit-taking by institutional players remain the two biggest domestic risks to sustained growth in 2026.
What’s Being Said
- “The dominance of domestic investors insulated the market from global shocks… the outlook remains positive primarily because the drivers of Q1 performance are still intact,” stated Prof. Uche Uwaleke, President of CMAN.
- Uwaleke added that the listing of the Dangote Refinery “could be a major catalyst for the market,” attracting massive retail and institutional attention.
- Regarding the T+1 transition, he noted that “significant investment in market infrastructure” and system upgrades by the SEC ensure the ecosystem is “sufficiently robust” for the May deadline.
- He identified Consumer Goods and Industrial stocks as sectors to watch, specifically those benefiting from “improved foreign exchange access and reduced input cost volatility.”
What’s Next
- Investors will be looking toward May 29, 2026, for the successful implementation of the T+1 settlement cycle, which is expected to increase market velocity.
- The market is awaiting formal filings regarding the Dangote Refinery listing, which could trigger a massive sectoral rotation toward Energy stocks.
- The Central Bank’s next policy meeting will be crucial; any further interest rate hikes to combat residual inflation could tempt investors to shift capital from equities to high-yield fixed-income instruments.
Bottom Line
With a “domestic shield” and the twin engines of banking recapitalization and major industrial listings, the Nigerian capital market appears set to defy global headwinds and maintain its bullish momentum through the second half of 2026.
