The selloff reflects growing concern that the new tax regime could dampen investment appetite and trigger further market volatility.

The Nigerian Exchange (NGX) All-Share Index plummeted to 141,327.30 points, marking its seventh consecutive session of losses. Major blue-chip stocks — Dangote Cement, MTN Nigeria, and BUA Cement — all fell by the maximum allowable 10 per cent, accounting for much of the market’s sharp decline. As a result, the market’s Month-to-Date and Year-to-Date returns settled at -8.3 per cent and +37.3 per cent, respectively.

According to trading data, total mar­ket turnover surged by 80 per cent to 655.95 million shares, valued at N29.39 billion, exchanged in 29,558 deals. FBN Holdings emerged as the most traded stock by volume with 68.27 million shares, while Geregu Power Plc topped the value chart with trades worth N4.42 billion.

The rout was broad-based across sec­tors. The Industrial Goods Index suffered the steepest decline, plunging 8.6 per cent, followed by Banking (-7.3 per cent), Oil & Gas (-4.6 per cent), Insurance (-4.3 per cent), and Consumer Goods (-2.2 per cent). ­

 Market breadth remained deeply negative at 0.1x, as 59 stocks declined while only four gained. Academy Press and BUA Cement both lost 10 per cent, while NCR Nigeria (+9.8%) and Berger Paints (+2.3%) managed to end the day on a positive note.

Investors panic ahead of 2026 tax en­forcement

The latest market turmoil fol­lows the Federal Government’s move to enforce the Capital Gains Tax Act, which will see a 10 per cent levy on profits from the sale of capital assets such as shares, bonds, and real estate.

The implementation, expect­ed to take effect from January 1, 2026, has stirred anxiety among both local and foreign investors.

Several portfolio investors, fearing higher future taxes, are said to be liquidating positions to lock in gains under the existing regime before the new rules take hold. Analysts warn that this pre-emptive selloff could persist in the short term, potentially erod­ing some of the market’s impres­sive 2025 gains.

“Investors are repositioning ahead of the 2026 enforcement date,” said one Lagos-based equity trader. “The fear is not just about the tax itself, but the uncertainty it brings to investment planning, especially for those managing short-term portfolios.”

Financial analysts have also raised concerns that the CGT may discourage venture capital inflows, real estate investments, and high-value asset transactions, all of which are vital to Nigeria’s fragile economic recovery.

“Introducing a capital gains tax at this time could have a chilling effect on investment sen­timent,” said a senior analyst at Cordros Capital. “Foreign port­folio investors are already jittery due to FX volatility and high in­flation. The timing of this policy risks worsening capital flight.”

Edun hints at policy review

Amid mounting criticism, Min­ister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, has hinted that the Federal Government may revisit the CGT framework to ensure it does not sti­fle growth or investor confidence.

Responding to pleas from stockbrokers and capital market operators, Edun said the govern­ment would “go back to the draw­ing board” to review aspects of the law that could hinder economic expansion.

“We are going to do what is good for the economy and for Ni­gerians,” the minister assured, suggesting that adjustments may be made to cushion potential neg­ative impacts on investment.

Edun, who spoke during the listing ceremony of the MOFI Real Estate Investment Fund (MREIF) on the NGX, reaffirmed the administration’s commitment to fostering private sector-led growth through market-driven reforms.

“The MREIF represents a transformative approach to afford­able housing—mobilizing private and institutional capital into the housing sector, creating jobs, and stimulating economic growth,” he said. “With strong credit ratings of AAA by Agusto & Co and AA by GCR, the Fund demonstrates investor confidence and offers a sustainable model for financing social infrastructure through public-private partnerships.”

Analysts Call for Gradual Implementa­tion

Market watchers say while the idea of broadening Nigeria’s tax base is understandable, the timing and communication of the CGT rollout appear to have spooked investors already grappling with tight liquidity, high interest rates, and currency fluctuations.

They suggest that the govern­ment could consider a phased or sector-specific implementation, especially for equities and venture capital investments, to minimize disruption to market dynamics.

“The intention behind the CGT is good—to diversify reve­nue sources and reduce depen­dence on oil—but it must be done thoughtfully,” said a capital mar­ket expert. “A sudden implemen­tation could reverse the positive momentum we’ve seen in the NGX this year.”

As policymakers deliberate possible revisions, investors will be watching closely for clarity on the structure and timing of the tax. Until then, the fear of capital gains erosion is likely to keep the market under pressure, with vol­atility expected to persist in the coming weeks.