By Seun Ibiyemi
Nigeria’s stock market suffered a significant setback on Wednesday, recording its sharpest daily decline since the beginning of November, as the benchmark index dropped by 1.19 percent.
The downturn extended the market’s losing streak to three consecutive sessions, wiping out a total of over N2.1 trillion in value within the period.
The latest decline was largely driven by sustained profit-taking activities, as investors continued to sell off shares that had experienced substantial gains in previous months, particularly in October, when the market rallied by about 8 percent.
This was attributed the renewed bearish momentum to investor caution stemming from heightened geopolitical uncertainty following a weekend threat by United States President Donald Trump.
The threat, which rattled global financial markets, has increased concerns about potential spillover effects on emerging markets like Nigeria, particularly through a rise in risk premiums and capital outflows.
As a result, both equities and other domestic asset classes have come under pressure since the start of the week.
The cumulative effect has been a significant erosion of market gains built up earlier in the year amid optimism over the government’s economic reform agenda.
Data from the Nigerian Exchange Limited (NGX) showed that the All-Share Index (ASI) fell from 152,629.6 points recorded on Tuesday to 150,573.87 points on Wednesday. Similarly, market capitalization declined from N96.97 trillion to N95.66 trillion, representing a one-day loss of about N1.3 trillion.
So far in November, the market has lost approximately 2.15 percent, trimming the year-to-date return to 46.52 percent. This decline underscores growing investor anxiety as traders seek to lock in profits and hedge against possible volatility in the coming weeks.
Market operators expect the cautious sentiment to persist in the near term, especially as global uncertainty and domestic macroeconomic challenges continue to weigh on investor confidence.
They noted that while the Nigerian market remains fundamentally strong, short-term volatility could remain elevated until greater clarity emerges on both the international political scene and Nigeria’s fiscal outlook.