Why is the Nigerian stock market suddenly the best-performer globally?

Nigeria now leads this year’s global stock table after its main equity index delivered a 67% return in dollar terms. That puts it just ahead of South Korea’s Kospi, which gained 66%. Bloomberg compared 92 exchanges, making Nigeria the strongest performer.

South Korea had led as investors chased artificial intelligence shares. That trade later cooled and pushed the market into bear territory. Nigeria took first place as local stocks kept rallying, the naira gained 4% from January, crude prices stayed firm, and foreign currency became easier to access.

Economic reforms and better dollar access keep Nigerian shares rising

As we hinted, the rally has several drivers. The government carried out broad economic reforms. Oil income improved as crude prices rose. Banks and investors also found more foreign exchange, which matters because global funds need to convert naira and send proceeds abroad without long delays.

Currency strength added to the return. A local stock gain can vanish for a foreign buyer when the home currency drops. That has not happened this year. The naira’s 4% increase lifted the dollar value of profits already made on Nigerian shares.

However, a proposed upgrade of the index has further made it worth watching for investors. This is because, according to S&P Dow Jones Indices, which is a subsidiary of S&P Global (NYSE: SPGI), Nigeria is set to be upgraded back to being a frontier market. At the moment, Nigeria belongs to the standalone classification.

Nigeria’s Securities and Exchange Commission has started work meant to keep the review on course. The regulator plans to form a committee that will monitor each condition S&P DJI wants before reaching its final decision.

The committee will publish certified reports every quarter. Those files will cover trade settlement, how long foreign investors wait to repatriate money, market liquidity, and other figures requested during the review.

SEC Director-General Emomotimi Agama said the review “represents the country’s most significant opportunity in a decade to regain global investor confidence and attract increased foreign portfolio investment.”

“The reform programme is complete; the evidence programme now begins,” Emomotimi said.

IMF forecasts put Nigeria ahead while global growth loses speed

The stock surge is happening beside a better forecast for the wider economy. The International Monetary Fund expects Nigeria to grow by 4.1% in 2026 and 4.3% in 2027.

Those figures appeared in the IMF’s July 2026 World Economic Outlook Update, released on Wednesday and titled Global Economy in Crosscurrents of War and Technology.

The same report expects worldwide growth to ease from 3.5% in 2025 to 3.0% in 2026. It then sees growth reaching 3.4% in 2027.

The IMF linked Nigeria’s outlook to steadier economic conditions, better trade terms, and recent policy changes. It also warned that rising prices for food and other basic goods are still hurting households.

“Nigeria is supported by improved macroeconomic stability and favourable terms-of-trade effects, though higher prices for essentials are expected to further aggravate poverty and food insecurity,” the IMF said.

The global outlook remains difficult. The IMF pointed to conflict in the Middle East, inflation pressure, and unequal gains from new technology. Artificial intelligence is creating business growth, but the benefits are not reaching every economy at the same rate.

The United States shows a similar split between markets and everyday economic conditions. Economists said growth has been weaker than the stock rally. Many consumers and investors expect both to rise and fall together, but that has not happened.

The S&P 500 rose almost 10% in the first half of 2026. The Dow Jones Industrial Average gained nearly 9%, its strongest first half since 2021.

That followed three large yearly gains for the S&P 500. It rose 24% in 2023, 23% in 2024, and 16% in 2025. That was its second-best three-year run since 2000.

Meanwhile, according to the Surveys of Consumers from the University of Michigan, consumer confidence had fallen to an all-time low in May due to fears about inflation. There was some improvement in June, yet the survey described sentiment as unfavorable.