Fears of global recession hit stock markets as Nigerian bourse lose N600b

• U.S. 14% tariff has little impact on Nigeria’s exports, Edun insistsMounting fears of a world recession, pushed by aggressive tariff insurance policies in the USA, and a wave of financial uncertainty are sending shockwaves by inventory markets worldwide, with the Nigerian Alternate Restricted (NGX) not exempted.

However Nigeria’s Minister of Finance and Coordinating Minister of the Financial system, Wale Edun, insists that the current 14 per cent tariff imposed by the U.S. on Nigerian exports may have a negligible impact on the Nigerian financial system.

From Wall Road to the buying and selling flooring in Lagos, buyers are bracing for a chronic interval of volatility, capital flight and weakened earnings outlook.

Though the Nigerian Alternate Restricted (NGX) has to this point been shielded from the worst of the worldwide rout, cracks are starting to indicate.

Investor sentiment is waning and overseas portfolio buyers, usually fast to retreat in occasions of world stress, are reassessing their positions in rising markets like Nigeria.

Buying and selling volumes on the NGX have thinned and key indices are starting to mirror the broader risk-off sentiment.

As an example, regardless of spectacular monetary outcomes from main corporations, together with bumper dividend pay-outs by Tier-1 banks and blue-chip companies, the broader market didn’t rally, with over N100 billion losses in a single week, suggesting that exterior pressures and native uncertainties are overpowering company fundamentals in driving investor selections.

Market exercise was notably subdued in the course of the week below evaluate, reflecting the cautious temper of buyers amid shortened buying and selling classes. Complete trades dropped by 30.9 per cent week-on-week to 42,397 transactions, whereas each quantity and worth traded suffered steep declines.

The quantity of shares traded additionally shrank by 84.3 per cent to 1.18 billion models, and the worth of transactions plummeted by 92.8 per cent to N28.87 billion, underscoring the affect of weak market participation.

Yesterday, market capitalisation dipped by N600 billion from N66.147 trillion on Friday to N65.488 trillion, whereas the All-Share Index (ASI) declined by 1,295.02 (1.2 per cent) to 104, 216.87 from 105,511.89 achieved on Friday.

Additionally, nearly all blue-chip shares depreciated on the worth motion chart, as 51 shares misplaced whereas 9 constituted the gainers chart. GTCO emerged the very best value loser with 3.90 kobo to shut at N65.50 kobo, whereas Aradel adopted with N3.00 to shut at N497. United Financial institution for Africa (UBA) misplaced 2.80 kobo to shut at N36.85 kobo.

Transnational Company of Nigeria depreciated by 2.60 kobo to shut at N42.10 kobo. Zenith Financial institution, Nigerian Breweries and FirstHolco additionally misplaced N2.40 kobo, N2.00  and N1.65 kobo to shut at N45.50 kobo, N32 and N24.35 kobo respectively.

The set off got here final week when U.S. President Donald Trump imposed sweeping tariffs, together with a ten per cent levy on all imports, with even steeper charges of 34 per cent on Chinese language items and 20 per cent on merchandise from the European Union (EU). The transfer has not solely intensified commerce tensions but additionally stoked fears that the world’s largest financial system may very well be heading for a downturn.

Already, analysts at JPMorgan and Goldman Sachs have raised their projections for a U.S. recession in 2025 to 60 per cent and 45 per cent, citing weakening client sentiment, disrupted provide chains and shrinking world commerce volumes.

In Nigeria, analysts have warned that extra vital outflows may happen if world circumstances worsen, and the Central Financial institution of Nigeria (CBN) fails to keep up alternate price stability.

EDUN, on the inaugural Company Governance Discussion board organised by the Ministry of Finance Included in Abuja, yesterday, recognised the seriousness of escalating world tariff conflicts and emphasised that Nigeria stays comparatively insulated from extreme impacts, given the exclusion of oil and mineral exports, Nigeria’s main exports to the US, from the tariff.

He highlighted the comparatively average 14 per cent tariff as beneficial when positioned alongside Vietnam’s 46 per cent and China’s 34 per cent.

“Nigeria’s exports to the U.S. had been N1.8 trillion, N2.6 trillion and N5.5 trillion in 2022, 2023 and 2024, respectively. Luckily, oil and mineral exports accounted for 92 per cent, implying oil and mineral exports amounted to N5.08 trillion in worth, whereas non-oil was simply N0.44 trillion. Consequently, the tariff impact on exports is negligible if we maintain our oil and minerals export quantity,” he mentioned.

Nonetheless, Edun admitted that authorities’s financial administration crew was carefully monitoring the worldwide scenario.

Addressing the broader state of the Nigerian financial system, Edun praised the stabilisation achieved below President Bola Tinubu’s administration.