Association of Securities Dealers Calls For Prudence Amid Stock Market Rally

The Houses of Nigeria (ASHON) has urged caution as the Nigerian capital market experiences a sustained bullish run, warning that unchecked speculation could threaten market stability.

The current rally on the Nigerian Exchange Limited (NGX) has generated excitement among investors, but analysts have raised concerns that some securities are experiencing sharp price gains without corresponding fundamentals such as earnings growth or robust corporate governance.

Market observers feared that overpricing in certain stocks could create vulnerabilities, making the market more sensitive to shocks and speculative behaviour.

In a statement, ASHON attributed the rally to renewed investor confidence, stronger macroeconomic sentiment, and broader participation across asset classes.

The association cited the recent suspension of Zichis Agro-Allied Limited by NGX over irregular trading as a reminder of the need for orderly markets, saying that “the decisive action by NGX underscores the importance of maintaining market integrity.”

While welcoming the market upswing, ASHON stressed that “gains must be grounded in fundamentals such as corporate earnings, governance, and economic indicators. The body warned against speculative excesses reminiscent of the 2008–2009 market crash.”

ASHON also called on regulators, including RegCo, to strengthen surveillance and enforce compliance. It urged listed companies to comply with free float requirements and encouraged efforts to attract new listings to deepen market liquidity and broaden investment opportunities.

The Association reaffirmed its dedication to professionalism, ethical standards, and investor protection, emphasising that optimism must be balanced with responsibility to foster a stable and sustainable capital market that advances Nigeria’s economic growth.