Full Breakdown
African Stock Exchanges Experience Record Bull Run
1/4/2026, 11:54:48 AM
Overview of Market Performance
In 2025, African stock exchanges witnessed significant gains, encouraging local investor participation and prompting domestic companies to pursue initial public offerings (IPOs) and other capital-raising activities. Notably, many African currencies appreciated against the US dollar, enhancing stock market returns for USD investors. The Malawi Stock Exchange All Share Index (MSE ASI) led the performance with a remarkable increase of 247.6% for local investors and 248.0% for USD investors, closing at 598,602.8 on December 31, 2025. Other notable indices included the Ghana Stock Exchange Composite Index (GSE-CI), which returned 79.4% locally and 154.4% in USD, and Zambia’s Lusaka Securities Exchange All Share (LuSE ASI), which saw returns of 67.9% for local investors and 111.7% for USD investors.
Key Figures in the Market
The Nigerian Exchange All Share (NGX ASI) reported a 51.2% return for local investors and 60.6% for USD investors, contributing to a market capitalization nearing NGN 100 trillion ($69.1 billion). The exchange experienced strong inflows into exchange-traded funds, with a market capitalization of NGN 45.6 billion ($32 million). The Egyptian Exchange (EGX) also performed well, with a 42% year-on-year increase in market capitalization and a 20% rise in registered investors, reaching 276,000.
Factors Driving Growth
The growth in African stock markets can be attributed to several factors, including macroeconomic stabilization and capital market reforms. In Nigeria, the NGX's investments in technology and market infrastructure have improved access and operational efficiency. Similarly, the EGX's Chairman, Islam Azzam, expressed optimism about the market's potential to be reclassified as a Developed Market, forecasting eight new listings in 2026.
Criticism and Concerns
Despite the impressive gains, some analysts caution that the sustainability of this bull run may be in question. For instance, Armstrong Kamphoni, a stockbroker at Cedar Capital, noted that while the rally in Malawi's stocks might continue due to limited investment alternatives amid high local inflation, a stabilization of the currency could lead to a correction in stock prices. Concerns about the availability of local currency liquidity and the valuation of stocks based on forward earnings have also been raised.
Future Developments
Looking ahead, the Rwanda Stock Exchange (RSE) is set to mark its 15th anniversary with significant developments, including the introduction of a Multicurrency Denominated Securities market segment and a Green Exchange Window for sustainable investments. The RSE aims to enhance its capital-raising capabilities and has joined international organizations such as the World Federation of Exchanges and the United Nations Sustainable Stock Exchanges Net Zero Financial Service Providers Alliance.
Verbatim Quotes
- “Stockbroker Armstrong Kamphoni of Cedar Capital told African Capital Markets News: “In an inflationary environment, the rally in stocks might be sustained as investors do not have much alternative home for their money.” — Armstrong Kamphoni, Stockbroker at Cedar Capital
- “The rally reflected a confluence of macroeconomic stabilization and deliberate capital market reforms.” — BusinessDay Nigeria report
This comprehensive overview highlights the remarkable performance of African stock exchanges in 2025, while also addressing the potential challenges ahead.
