Nigeria’s stock market on Tuesday suffered one of its largest single-day losses, shedding N4.6 trillion as investors fled, reacting to U.S. President Donald Trump’s threat of military action and the Federal Government’s plan to implement Capital Gains Tax (CGT).
Highly capitalised companies such as Dangote Cement Plc, MTN Nigeria Communications Plc, and BUA Cement Plc all dropped by 10 per cent, closing at N594.00, N162.00, and N429.30 per share, respectively.
The NGX market capitalisation closed at N89.885 trillion, down 4.91 per cent (N4.6 trillion) from the opening value of N94.526 trillion. Investors in Dangote Cement lost N1.11 trillion in value, BUA Cement fell by N609.6 billion, and MTN Nigeria Communications saw a N1 trillion decline.
This caused a sharp five per cent fall in the NGX All-Share Index, which closed at 141,327.30 basis points, down 7,454.60 points from 148,781.90 at the start of trading. Month-to-Date and Year-to-Date returns also fell to -8.3 per cent and +37.3 per cent, respectively.
Sectoral performance mirrored the broader downturn, with the NGX Industrial Goods Index down 8.6 per cent, NGX Banking Index 7.3 per cent, NGX Oil & Gas Index 4.6 per cent, NGX Insurance Index 4.3 per cent, and NGX Consumer Goods Index 2.2 per cent.
Analysts attributed the market drop to investor sentiment over Trump’s military warning and the CGT announcement. On Truth Social, Trump said he had instructed the Pentagon to “prepare for possible action” and warned of the immediate suspension of U.S. aid to Nigeria.
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Bola Tinubu rejected Trump’s comments, calling them a misrepresentation of Nigeria’s “consistent and sincere efforts to safeguard freedom of religion and belief for all Nigerians.”
Investment banker and stockbroker Tajudeen Olayinka said, “The combination of these two factors have played a significant role in investors’ profit-taking in highly capitalised stocks on the NGX. The likes of Dangote Cement, among others that dropped when the market closed, have strong forces to pull down the market. The overall negative news around the market have played a significant role.”
David Adonri, Vice Chairman of the Board at HighCap Securities, added, “Short-term market adjustments are normal in a dynamic market like Nigeria’s. The underlying fundamentals remain strong, and the year-to-date performance highlights the resilience and depth of our capital markets.”
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