Nigerian equities have overtaken South Korea’s stock market to become the world’s best-performing equity market in dollar terms this year, buoyed by economic reforms, a stronger naira and improved foreign exchange liquidity, according to a Bloomberg report.

The global financial news service reported on Thursday that Nigeria’s benchmark stock index has returned 67 per cent in dollar terms so far this year, surpassing South Korea’s Kospi index, which returned 66 per cent before slipping into a technical bear market.

Drawing on data from 92 global stock exchanges tracked by Bloomberg, the report ranked Nigeria as the world’s top-performing equity market, ahead of South Korea, Ghana and Taiwan.

According to Bloomberg, Nigerian equities overtook South Korea’s as weakening sentiment towards artificial intelligence-related stocks reversed the Asian country’s earlier market rally.

The report noted that South Korea’s Kospi index entered a technical bear market after falling 22 per cent from its June 19 peak, as investors questioned the sustainability of the global artificial intelligence boom.

Bloomberg also attributed the decline in investor returns to the depreciation of the South Korean won, which has weakened by about five per cent against the US dollar since the beginning of the year, making it one of Asia’s poorest-performing currencies.

In contrast, the report said Nigeria’s stock market has benefited from improving macroeconomic conditions driven by ongoing economic reforms, higher international crude oil prices and improved foreign exchange liquidity.

Bloomberg added that the naira has appreciated by about four per cent against the dollar since January, further boosting dollar-based returns for foreign investors.

The report said the combination of exchange rate stability, improved forex supply and investor confidence has strengthened the appeal of Nigerian equities, helping the market outperform all other major global stock exchanges in dollar terms this year.