Nigerian Stocks Hit Record High as Bull Run Pushes Major Equities Into Overbought Territory

Nigeria’s equities market has extended its multi-month bull run to fresh records, with the NGX All-Share Index (ASI) closing above the 252,000-point level as strong buying interest continues across major stocks.

The benchmark index closed at 252,113.41 points on Friday, September 25, 2026, after briefly reaching 252,150.01 points in the previous session. The market’s latest advance has pushed the ASI more than 60% higher year-to-date, reflecting the scale of the rally in Nigerian equities.

At the same time, technical indicators suggest that parts of the market have become increasingly stretched. The ASI and several large-cap Tier-1 stocks have entered overbought territory, with the Relative Strength Index (RSI) above the conventional 70 threshold for a number of leading equities.

What you should know

An RSI above 70 generally indicates that a security has experienced strong upward momentum over a relatively short period.

It does not automatically mean that a stock must fall. A market can remain above 70 for an extended period during a strong bull run.

Instead, an overbought reading tells investors that prices have risen rapidly relative to their recent trading history and that the market may become more vulnerable to profit-taking or a correction.

This distinction is important because the NGX is currently combining strong fundamentals, liquidity and investor demand with stretched technical conditions.

NGX reaches another record

The latest record extends a powerful recovery in Nigerian equities.

The ASI crossed 250,000 points for the first time on September 21, closing at 250,156.80 points. It subsequently moved above 251,000 points before reaching the 252,000-point threshold.

By September 25, the index had gained about 0.92% during the week, closing at 252,113.41 points compared with 249,804.56 points a week earlier.

Market capitalisation also reached roughly N163.7 trillion, reinforcing the scale of the current rally.

The speed of the move is significant because the index had fallen sharply during the correction in late August and early September before recovering strongly.

Liquidity is supporting the rally

One of the major forces behind the renewed buying interest is liquidity.

Pension funds, institutional investors and other domestic market participants have increased their exposure to equities, while regulatory changes have created additional room for institutional capital to participate in the market.

This is particularly important for large-cap stocks because a relatively small number of highly capitalised companies account for a significant portion of the NGX’s overall valuation and index movement.

Recent sessions have seen strong activity in banking, industrial and oil and gas stocks, although leadership has rotated between sectors.

On September 24, for example, the Oil and Gas Index jumped 3.95%, helping push the broader market to another record even as the Banking and Insurance indices declined.

Lower FX pressure is also improving the environment for companies

Another factor supporting the equity market is the improvement in Nigeria’s foreign-exchange environment.

Reduced FX pressure can benefit companies that previously faced difficulties obtaining foreign currency for imported inputs, debt obligations and other international payments.

For investors, a more stable FX environment can also make corporate earnings easier to assess because extreme currency movements create significant uncertainty around revenue, costs, foreign-currency liabilities and profit margins.

However, the benefit is not uniform across all listed companies.

Companies with substantial dollar revenues can experience different effects from those that depend heavily on imported inputs, while businesses with foreign-currency debt can also respond differently to naira movements.

Tier-1 banks remain central to the rally

Large-cap banking stocks have been an important component of the market’s recent advance.

The banking sector’s importance goes beyond its individual companies because the largest banks have substantial market capitalisations and therefore have a meaningful influence on the broader index.

Recent sessions have recorded strong buying in major banking and Tier-1 equities, with September 23 trading volume reaching 1.59 billion shares across 49,736 deals, driven partly by sustained buying interest in key banking stocks.

The sector is also undergoing structural changes linked to bank recapitalisation, which has increased investor attention toward the earnings capacity, capital positions and future growth prospects of major financial institutions.

Why the overbought signal matters

The biggest technical warning is the growing number of stocks with RSI readings above 70.

When prices rise rapidly, the RSI can move into overbought territory because recent gains become significantly larger than recent losses.

That can create the conditions for profit-taking, particularly among investors who bought stocks earlier in the rally and now have substantial unrealised gains.

A correction does not necessarily invalidate the underlying bull market.

The market could experience a period of consolidation, with prices moving sideways while corporate earnings and fundamentals catch up with valuations.

Alternatively, individual stocks could experience sharp declines even while the broader ASI remains relatively strong.

This is particularly relevant because technical analysis reported on the market has identified overbought conditions across several oil and gas, industrial and banking stocks, with some trading significantly above their moving averages.

Strong momentum does not guarantee a crash

The presence of overbought conditions should not be interpreted as proof that an imminent market crash is coming.

In a strong bull market, an RSI above 70 can persist because buying pressure remains strong.

The more useful interpretation is that the margin for further rapid price increases may be narrowing, particularly where valuations have moved substantially ahead of earnings growth.

Investors will therefore need to distinguish between companies whose share-price gains are supported by improving earnings and those where price momentum has become the dominant driver.

What investors will be watching

Several factors will determine whether the rally can maintain its momentum:

• Corporate earnings: whether profit growth continues to justify higher valuations.
• Interest rates: lower fixed-income yields can make equities relatively more attractive, although this depends on inflation and real returns.
• Pension and institutional flows: continued domestic institutional demand could provide a strong liquidity base.
• Foreign participation: Nigeria’s return to FTSE Russell Frontier Market status could improve international visibility and potentially support additional flows.
• FX stability: continued improvement in currency liquidity could reduce uncertainty around corporate earnings.
• Valuations: the further prices move ahead of earnings, the greater the potential for profit-taking.
• Market breadth: whether gains continue spreading beyond a relatively small group of large-cap stocks.

The bigger picture

Nigeria’s stock market is now operating at a level that would have appeared distant only weeks earlier, with the ASI above 252,000 points and market capitalisation around N163.7 trillion.

The rally has been supported by liquidity, institutional participation, improving macroeconomic conditions and strong demand for selected large-cap stocks.

But the technical picture has changed alongside the index.

With many leading equities showing RSI readings above 70, the market is increasingly in a zone where further gains could be accompanied by sharper bouts of profit-taking and volatility.

The central question is therefore no longer simply whether Nigerian stocks can continue rising. It is whether earnings, liquidity and improving economic conditions can continue catching up with the valuations created by one of the market’s strongest multi-year rallies.