Securities dealers urge caution amid Nigerian stock market rally

2026-02-25 - 17:57

By Peter Egwuatu The Association of Securities Dealing Houses of Nigeria (ASHON) has called for prudence as Nigeria’s capital market records a sustained bullish run, warning that unchecked speculation could threaten market stability. The ongoing rally on the Nigerian Exchange Limited (NGX) has sparked investor enthusiasm. However, analysts caution that some securities are posting sharp price gains without corresponding fundamentals such as earnings growth and strong corporate governance, raising concerns about possible overvaluation and market vulnerability to shocks. In a statement, ASHON attributed the rally to renewed investor confidence, improved macroeconomic sentiment, and broader participation across asset classes. The association also cited the recent suspension of Zichis Agro-Allied Limited by NGX over irregular trading as a reminder of the importance of maintaining orderly markets. “The decisive action by NGX underscores the need to preserve market integrity,” ASHON stated. While welcoming the market upswing, the association stressed that gains must be rooted in fundamentals, including corporate performance, governance standards, and key economic indicators. It warned against speculative excesses reminiscent of the 2008–2009 market crash. ASHON further urged regulators, including RegCo, to strengthen market surveillance and enforce compliance, while encouraging listed companies to meet free float requirements and support initiatives aimed at attracting new listings to deepen liquidity and broaden investment opportunities. The association reaffirmed its commitment to professionalism, ethical standards, and investor protection, emphasizing that optimism must be balanced with responsibility to ensure a stable and sustainable capital market that supports Nigeria’s economic growth.