Being able to name the letters of the alphabet is a good predictor of beginning reading achievement. The most likely explanation for this is that:

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Children who have been exposed to early and rich literacy activities are more likely to know the letters of the alphabet, and this knowledge can then serve as a foundation for learning to read. It is not necessary for a child to be able to name every letter in order to read words, and simply engaging in drill and practice activities may not necessarily lead to reading success. Additionally, while knowledge of the alphabet can support phonological awareness and phonics instruction, it is not the same as phonemic awareness.

Being Able to Name the Letters of the Alphabet Is