Good people of AprokoNation, it's a new month and a fresh quarter! We've just stepped into April and Q2, and what a period of reflection and anticipation it promises to be.
Looking back at Q1, our Nigerian Exchange (NGX) truly stood out, emerging as the second-best performing market globally, boasting a remarkable 30% year-to-date return. This surge saw the market capitalization climb by N29.83 trillion, crossing the N129 trillion mark, with the All-Share Index (ASI) gaining an impressive 29.35%. A significant part of this performance was fueled by renewed investor confidence, strong corporate earnings, and strategic economic reforms that improved liquidity and investor sentiment. We also observed a notable shift with the ICT sector becoming a dominant force, and the oil and gas index delivering exceptional returns.
As we navigate Q2, the outlook remains cautiously optimistic. Projections indicate a moderate GDP growth of around 3.8-4.6%, bolstered by improved crude oil production and a robust services sector. The Naira has also shown strength, recording a more than 7% gain against the dollar this quarter, making it the world's second-best performing currency. We anticipate the Q1 2026 earnings season will further drive market momentum, with potential game-changers like the anticipated Dangote Refinery IPO in the coming months poised to attract significant investor interest and further strengthen our currency.
However, it's crucial to acknowledge the headwinds. Global risk-off sentiments, particularly from geopolitical tensions, could introduce volatility and potentially lead to higher interest rates and bond market sell-offs. While inflation is expected to gradually moderate, vigilance is key, as rising oil prices could reignite inflationary pressures and influence the Central Bank's monetary policy stance. Fiscal discipline and consistent policy execution will be vital to sustain the positive trajectory seen in Q1.
Let's keep our eyes on the market, adapt to the shifts, and look forward to a productive Q2. Happy New Month, everyone!