Foreign firms raise stake in NGX to N71.4bn

The total foreign transactions on the Nigerian Exchange Limited jumped by 113.94 per cent to N71.37bn (about $75.76m) in November compared to N33.36bn a month earlier.

This was revealed in the latest Domestic and Foreign Portfolio Investment Report for November published by the Nigerian Exchange Limited.

There has been a consistent drop in foreign participation in the Nigerian capital market worsened by the Covid-19 pandemic in 2020. As of September 2023, total domestic transactions were valued at N2.454tn, whilst total foreign transactions were worth about N258.02bn.

The latest figure from the NGX showed that as of November, total foreign transactions had improved to N363bn while total domestic transactions stood at N2.871tn.

Monthly, foreign transactions dropped in October to N33.36bn from N35.24bn. It however jumped to N71.37bn in November.

‘’The total transactions executed between the current (November) and prior month (October 2023) revealed that total domestic transactions increased by 22.24 per cent from N187.58bn in October to N229.30bn in November 2023. Similarly, total foreign transactions increased by 113.94 per cent from N33.36bn (about $36.83m) to N71.37bn (about $75.76m) between October 2023 and November 2023,” the report disclosed.

A further breakdown of the foreign transactions showed that outflows outweigh inflows. As of November 2023, foreign inflow stood at N157.32bn compared to N205.43bn in outflow. The highest level of inflow was recorded in November at N34.77bn and the lowest was in April which was N3.67bn.

A look at the general market trend revealed that as of November 30, 2023, total transactions at the nation’s bourse increased by 34.08 per cent from N220.94bn (about $243.93m) in October to N300.67bn (about $319.15m) in November 2023. When compared to the figure for November 2022 figure (N104.28bn), total transactions increased by 188.33 per cent year-on-year.

In November 2023, the total value of transactions executed by domestic investors outperformed transactions executed by foreign investors by about 52 per cent.

Meanwhile, institutional investors outperformed retail investors by 20 per cent. A comparison of domestic transactions in the current and prior month (October 2023) revealed that retail transactions increased by 7.30 per cent from N86.46bn in October to N92.78bn in November 2023.

Also, the institutional composition of the domestic market increased by 35.01 per cent from N101.12bn in October 2023 to N136.52bn in November 2023.

An historical trend of the market revealed that over 16 years, domestic transactions decreased by 45.30 per cent from N3.556tn in 2007 to N1.945tn in 2022 whilst foreign transactions also decreased by 38.47 per cent from N616bn to N379bn over the same period.

Total domestic transactions accounted for about 84 per cent of the total transactions carried out in 2022, whilst foreign transactions accounted for about 16 per cent of the total transactions in the same period.