Nigerian equities have overtaken South Korea’s stock market to become the world’s best-performing equity market in dollar terms this year, buoyed by macroeconomic reforms, improved foreign exchange liquidity and renewed investor confidence.
According to a Bloomberg report on Thursday, Nigeria’s benchmark stock index has returned 67 percent in dollar terms since the beginning of the year.
The performance edged South Korea’s Kospi index, which has gained 66 percent, among the 92 global stock exchanges tracked by the publication.
The report said South Korea lost its lead after the Kospi slipped into a technical bear market this week, falling 22 percent from its June 19 peak as investors reassessed the outlook for artificial intelligence (AI)-related stocks.
The South Korean won has also weakened 5 percent against the dollar this year, making it the fourth-worst-performing Asian currency.
In contrast, Bloomberg said Nigeria’s market has rallied on the back of economic reforms, firmer oil prices and improved foreign exchange supply, with the naira appreciating about 4 percent against the dollar since January.
According to the publication, financial services companies listed on the Nigerian Exchange (NGX) have driven much of the market’s gains, with Fortis Global Insurance Plc delivering a return of about 1,400 percent in dollar terms this year.
Also, unlike South Korea’s equity market, where technology and AI-related stocks dominate, Nigeria’s rally has been driven largely by domestic macroeconomic factors.
The report cited S&P Dow Jones Indices’ decision this week to place Nigeria on its 2027 watchlist for a possible reclassification to frontier market status could further strengthen investor appetite for Nigerian assets.
On July 8, S&P placed Nigeria on its 2027 watchlist for a possible return to frontier market status, saying the country’s regulatory environment has improved but that consistency in policy implementation and operational resilience remain necessary before a reclassification can be considered.
In addition, FTSE Russell deferred a decision on Nigeria’s return to its Frontier Market Index, citing the need to further assess the implications of the country’s transition to a T+1 settlement cycle for international investors.
