Dangote Refinery IPO, 2027 Election Politics Set to Influence Nigeria’s Stock Market Rally

Nigeria’s stock market is heading towards a potentially historic year-end performance, with analysts projecting that market capitalisation could rise above N200 trillion by December 2026, supported by the anticipated listing of Dangote Petroleum Refinery and sustained investor interest.

The projections suggest that investors could record returns of about 57 per cent or more, while the Nigerian Exchange Limited (NGX) All-Share Index may climb to approximately 280,000 points before the end of the year.

Analysts attributed the positive outlook to improving investor sentiment, strong corporate earnings, increased market liquidity, favourable economic conditions and expectations surrounding the Dangote Refinery listing.

Nevertheless, the approaching 2027 general elections, potential profit-taking and global economic uncertainties remain factors that could influence the market’s direction.

Market experts believe political uncertainty could weigh on investors if it raises concerns about the continuity of ongoing economic reforms or introduces the possibility of unfavourable policy changes.

Investors gain N62.76trn as equities rally

The Nigerian equities market has maintained an impressive upward trajectory in 2026, with investors’ wealth increasing by N62.76 trillion, equivalent to a 60.47 per cent appreciation, as of last week.

Figures from the market showed that capitalisation climbed from N99.376 trillion at the start of the year to N162.134 trillion.

The All-Share Index also advanced from 155,613.03 points to 249,710.59 points, representing a 60.5 per cent increase.

Several factors have contributed to the rally, including relative exchange-rate stability, stronger corporate earnings, improved liquidity, declining inflationary pressures and renewed investor confidence.

The Central Bank of Nigeria’s decision to lower the Monetary Policy Rate to 23 per cent has also provided support for equities.

Amolegbe forecasts 57.65% annual return

Olatunde Amolegbe, immediate past President of the Chartered Institute of Stockbrokers and Managing Director of Arthur Stevens Asset Management Limited, projected that the market could deliver an annual return of approximately 57.65 per cent.

While expressing optimism, he warned that the strong rally could encourage investors to take profits, resulting in temporary corrections and increased volatility.

He stated: “I remain cautiously optimistic about the Nigerian stock market for the rest of the year. My expectation is that the All-Share Index will deliver a full-year return of approximately 57.65%.”

Amolegbe said strong corporate earnings, domestic investor participation, improved confidence and ongoing economic reforms would remain important drivers of market growth.

However, he warned that inflation, high interest rates, exchange-rate uncertainties and global economic developments could pose downside risks.

His assessment of the first nine months showed that the ASI gained approximately 29.35 per cent in the first quarter, 13.98 per cent in the second quarter and 9.50 per cent in the third quarter.

He noted that market activity became more selective as investors increasingly evaluated corporate earnings, valuations and individual company fundamentals.

On the elections, Amolegbe said uncertainty could make foreign portfolio investors more cautious, potentially resulting in temporary capital outflows and profit-taking.

He, however, argued that continuity in economic reforms, policy stability and a credible electoral process would help protect investor confidence.

He advised investors to focus on fundamentally strong companies with sustainable earnings, sound corporate governance and attractive valuations.

Dangote IPO expected to revive secondary market

Sam Onukwue, immediate past Chairman of the Association of Stockbroking Houses of Nigeria and Managing Director of Mega Equities Limited, believes the conclusion of the Dangote Refinery IPO will provide fresh momentum for equities trading.

He explained that the secondary market experienced reduced activity during much of October because investors moved funds into the refinery’s primary market offering.

He stated: “The secondary market for equities was depressed for most part of October 2026 because of migration of financial assets to Dangote Refinery IPO in the primary market.

“With the conclusion of the IPO, the market is expected to normalize in the remaining period of the year up to Q1 2027.”

Onukwue projected that the refinery’s listing could push market capitalisation beyond N200 trillion in December.

He also expects the All-Share Index to close around 280,000 points as investors position themselves for year-end distributions, although election-related negative sentiment remains a potential risk.

He maintained that the 2027 elections might not have a substantial impact on equities, pointing to the increasing sophistication of investors and the stronger influence of global developments and domestic economic recovery.

Adonri sees N210trn market capitalisation

David Adonri, Managing Director of Highcap Securities Limited, projected an even higher market capitalisation of N210 trillion by December 2026, following the anticipated listing of Dangote Refinery.

He also expects the ASI to reach approximately 280,000 points, provided negative election-related developments do not undermine market sentiment.

Adonri observed that the market’s strongest performance occurred during the first quarter, while momentum weakened during the latter part of the second quarter and remained relatively marginal in the third quarter.

He said there was no consistent historical evidence showing that Nigeria’s equities market follows a particular pattern immediately before and after general elections.

According to him, the current election cycle is unlikely to produce a material impact on the market because of investor maturity, global economic developments and domestic macroeconomic recovery.

2027 election concerns could influence investor sentiment

Tajudeen Olayinka, market analyst and investment banker, expects the traditional year-end rally to materialise, although the Dangote Refinery IPO could delay its commencement.

He said the market would normally begin building momentum towards its year-end rally by the second week of November.

However, he believes the refinery’s anticipated listing could create additional excitement and attract new investors into the secondary market.

He stated: “Normally, market should begin to experience the usual buildup to year-end rally by second week in November, but could have some little delay because of the expected listing of Dangote Refinery IPO in this same month of November, which is also expected to create a post listing market wide rally because of the excitement around the IPO, and the fact that several new investors will be testing the market to have a firsthand experience of bull and bear.”

Olayinka expects the market to deliver positive year-end returns, provided there are no significant negative developments affecting the economy or equities market.

He attributed the strong first- and second-quarter performances to substantial liquidity from retail and institutional investors.

However, he explained that concerns over the adoption of the T+1 settlement cycle by the NGX and the Securities and Exchange Commission contributed to slower activities towards the end of the second quarter.

The third quarter also experienced bearish sentiments, with efforts to initiate another rally struggling to gain traction because of the liquidity attracted by the Dangote Refinery IPO.

On the 2027 elections, Olayinka warned that political campaigns advocating a reversal of fuel subsidy removal, alongside the absence of clear economic programmes from opposition camps, could discourage market activities.

He contrasted the current political environment with the 2023 presidential election, when the three leading candidates were perceived as supportive of market-oriented policies.

He stated: “Quite unlike what we experienced during the run-up to the 2023 presidential election, in which the three leading candidates were identified to be pro-market. The story is different today, and the market is already pricing and repricing risks accordingly.”

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