In Nigeria, the months from September to December usually come with rising costs. But interestingly, the stock market doesn’t always follow that pattern. Some data from the NGX All-Share Index (ASI)* shows that stock prices often slow down or even dip during this period.
At first glance, that might sound like bad news. But if you understand how the market works, you’ll realize it could actually be the best time to buy shares.
So, why do stock prices fall when everything else is getting more expensive? To explain this, let’s explore a concept called a market cycle or in simple terms, how the market moves through its ups and downs.
*(The All-Share Index (ASI) is simply a number that shows how well the entire Nigerian stock market is doing. It’s like a report card for the Nigerian Exchange (NGX). When the ASI rises, it means most stock prices are increasing; when it falls, it means many stocks are declining. It tracks the overall performance of all the companies listed on the NGX, helping investors see whether the market is generally doing well or not.)
Understanding Market Cycles
Think of the stock market like the Nigerian weather; it has its rainy and dry seasons, each coming around with different intensities. Similarly, the market operates in cycles, characterised by periods of rising prices and times of falling prices. These patterns, known as market cycles, can help you spot opportunities, especially when others are being cautious.
A typical market cycle starts with the recovery phase, when prices are low after a downturn, and only a few bold investors start to buy again. As confidence builds, the growth phase follows, companies report profits, optimism spreads, and prices rise. Eventually, the market reaches its peak, when excitement is high and everyone wants to invest. But this is often a warning sign that prices might soon drop. Then comes the decline phase, as fear sets in (caused by a combination of different factors), prices fall, and many investors pull back. Finally, the market hits the trough, its lowest point. It may look bleak, but this stage often holds the best opportunities, as recovery begins again from here.
How Market Cycles Can Help You Win in the Nigerian Stock Market
Now that you understand how market cycles work, let’s bring it closer to home. The Nigerian stock market follows a similar rhythm, with periods of excitement followed by periods of cooling off. Interestingly, towards the end of the year ( the ember months), stock prices often slow down. However, by the first quarter or halfway through the new year, the market usually springs back to life.
Take late 2023, for example. As the year wound down, activity on the Nigerian Exchange (NGX) dipped. Many investors became cautious due to concerns about inflation and the usual year-end spending. But by January 2024, things changed dramatically. The NGX All-Share Index (ASI) jumped by nearly 40%, rising from about 74,773 points in January to over 104,562 points by March, making it one of Africa’s best-performing markets at the time (Coronation Research).
Big players like UBA, Dangote Cement, and BUA Foods led the charge, rewarding investors who had quietly bought during the quieter months. In simple terms, those who saw opportunity in the slowdown reaped the rewards when the market bounced back.
We saw a similar pattern at the end of 2022. The market cooled as investors waited out uncertainty around inflation and politics. But once January 2023 arrived, optimism returned. The NGX ASI climbed almost 4% in just one month, banking and industrial stocks were among the biggest gainers (Coronation Research).
The lesson? While the ember months often bring price hikes in everyday commodities, in the stock market, they tend to bring discounts. Those who invest when prices are low before the recovery phase kicks in are usually the ones who smile the most when the market rebounds.
What’s Happening Right Now on NGX
As we move deeper into the ember months of 2025, the NGX is already showing signs of selective weakness. While the All-Share Index (ASI) still holds overall gains, some stocks are slipping, creating potential opportunity zones for those willing to act.
Stocks Under Pressure (Not an Exhaustive List)
While the Nigerian Exchange (NGX) has shown a strong performance this year, recording a 40.87% jump in a single day (October 7, 2025) — an unusually high figure — some individual stocks have recently come under pressure. Here’s a quick look at a few notable examples:
1. Aradel Holdings (ARADEL) – Down 1.59%
Aradel Holdings closed trading on October 7 2025, at ₦620 per share, a 1.6% drop from the previous day’s ₦630. Despite this dip, Aradel has still gained about 3.7% year-to-date, up from its ₦598 opening price in January.
2. Nigerian Aviation Handling Company (NAHCO) – Down 4.89%NAHCO’s share price fell 4.9% to close at ₦107 on October 7, from ₦112.50 the previous day. Even with this decline, the stock has seen a remarkable 132% increase since the start of the year, when it traded at ₦46.05 per share. This makes NAHCO one of the stronger performers overall in 2025, though it’s currently experiencing a short-term correction.
3. Guaranty Trust Holding Company (GTCO) – Down 4.04%
GTCO shares slipped 4% to close at ₦95, compared to ₦99 the day before. Like others on this list, GTCO remains positive for the year, up about 66.7% from its opening price of ₦57 in January. Despite the recent pullback, the stock remains among the more resilient banking names on the NGX (Coronation Research).
Overall, while a few stocks are cooling off after strong rallies, this doesn’t necessarily signal a negative trend. Market pullbacks often present a chance for savvy investors to reposition, especially when fundamentals remain strong.
How to Take Advantage of the Current Market Cycle
If you’d like guidance on which stocks to buy, you can:
- Speak to a team member, click on the WhatsApp chatbot
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