By Chukwuma Umeorah
The Nigerian stock market could see an additional $13 million (about N19.5 billion) in daily trades, effectively doubling current activity. Daily transactions on the Nigerian Exchange Limited (NGX) currently average about N20 billion, with foreign investors contributing just N3 billion of that figure. Yet, a decade ago, foreign players alone accounted for nearly N12 billion in daily trades.
Analysts at Cowrywise say that if the proposed longer trading hours on the NGX are implemented with the right infrastructure and policies, extending trading hours from 2:30 p.m. to 5:00 p.m. could help the market recover lost ground and potentially double its current turnover.
NGX’s consideration
The NGX recently disclosed that it is engaging stakeholders on a possible extension of its trading window, a move seen as one of the most significant structural reforms in recent years. The proposal, which was shared during an interactive session attended by over 120 market operators, reflected the Exchange’s push to deepen market activity and align with international practices.
Chief Executive Officer of NGX, Jude Chiemeka, said the initiative was designed to make the Nigerian market more competitive and attractive to global investors.
“The idea is to make our market competitive as opposed to saying that things are the way they are and they will continue to be like that. Ultimately, the reforms the government is doing, we believe, will really open up our markets. Where we are now is certainly not where we aspire to be. We’re at $11m a day. We’re looking to cross over to $100m to really become an emerging market,” Chiemeka explained.
He added, “Like I said at the outset, it is a market innovation. We are trying to internationalise our markets. We are trying to open up our markets. We are trying to bring innovation to our markets. We think the extension of our trading time is in readiness for all the things that this change is doing that will become evident in the near future.”
Global context and comparisons
The proposed extension comes at a time when major stock exchanges around the world are expanding their trading sessions. The Johannesburg Stock Exchange, for instance, has also announced plans to explore 24-hour trading, while others are adjusting to meet the growing needs of retail investors and the realities of global market overlaps.
Cowrywise in a report argued that “Extending the close to 5:00 p.m. synchronises Nigeria with the full trading day in London and catches the first 90 minutes of New York’s session (which opens at 3:30 p.m. Nigerian time). This would allow Nigerian equity prices to react more promptly to global market-moving news and make it easier for foreign investors, who typically work UK/US hours, to engage in our market. This overlap could improve liquidity and enhance market efficiency in a way that aligns with international standards.”
The report described the policy as a potential game-changer for the Nigerian equities market. The firm pointed out that “average daily turnover currently hovers around N20 billion ($14 million), with foreign investors contributing only about 20 per cent (roughly $3 million).
In contrast, in 2014, the market averaged $33 million in daily trades, of which foreign investors accounted for nearly half.
“If improved infrastructure and policies like extended trading hours help bring back even half of that foreign participation, the Nigerian market could see an additional $13 million (N19.5 billion) in daily trades, effectively doubling current activity. This would turbocharge the current positive momentum in the market,” the report stated.
Liquidity and price discovery
The analysts further noted that longer trading sessions would create room for deeper liquidity and more accurate intraday price discovery. By overlapping with foreign markets, especially London and New York, Nigerian equities would not only react faster to global developments but also become more appealing to international investors.
Cowrywise added that the reform aligns with the NGX’s ongoing transition to a T+2 settlement cycle expected by November 2025, describing both initiatives as part of the Exchange’s broader modernisation agenda.
“Adding extended trading hours aligns with this modernisation drive and sends a strong signal that the Nigerian market is becoming more globally competitive,” the report emphasised.
Implementation concerns
Despite the optimism, Cowrywise highlighted legitimate concerns raised by stakeholders. Brokers, custodians, registrars, and market makers may face significant operational costs from longer working hours, including extended power, staffing, IT, surveillance, and compliance requirements. Without adequate preparation, some intermediaries might simply close operations by the current 2:30 p.m. timeline, undermining the effectiveness of the policy.
The firm, therefore, recommended that the NGX adopt a gradual approach to implementation. This could involve starting with extended sessions on selected days, encouraging wider technology adoption, and reviewing transaction fees to offset the potential burden on market operators.
They added that while the NGX was eager to boost competitiveness and foreign participation, a poorly managed transition risks stretching infrastructure and operators beyond their current capacity.
On the other hand, a carefully phased approach could not only reinvigorate trading activity but also re-establish Nigeria as a stronger investment destination.
“It must be done in a way that reflects the operational realities of participants and is aligned with broader reforms in market infrastructure,” the report stated.
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