NGX domestic, foreign transactions plunge 36% to N346.23bn in April 2024 

Business a.m.

Domestic  and foreign portfolio transactions on the Nigerian Exchange Limited (NGX)   plunged 36 percent  in April 2024, as both total transactions dropped from the N538.54 billion recorded in March 2024 to N346.23 billion in April, according to the latest domestic and foreign portfolio investment report released by the NGX.

Despite  the decline in total transactions,the NGX still recorded a 81.07 per cent year-on-year increase in transaction value.

Even with domestic transactions experiencing a notable 49 percent drop from N444.28 billion in March to N225.40 billion in April 2024, domestic investors continued to be a driving force in the Nigerian stock market, outperforming foreign investors by 30 percent  in total transaction value.

While domestic transactions in the Nigerian stock market experienced a sharp decline from March to April 2024, foreign transactions showed a contrasting trend, growing from N94.26 billion  to N120.83 billion, a 28.19 percent increase in the same period. 

Even as domestic transactions decreased sharply from March to April 2024, institutional investors outperformed retail investors by 10 percent. Retail transactions experienced the heaviest blow, falling by 54.89 percent from N223.37 billion in March to N100.77 billion in April, while institutional transactions also declined by 43.58 percent, falling from N220.91 billion to N124.63 billion in the same period.  

In their analysis of the recent transactions in the Nigerian stock market, analysts from Cordros Securities Limited identified foreign investors’ weak interest as a key factor to watch in 2024. According to the analysts, the persistent challenge of accessing and repatriating funds has hindered foreign portfolio investment in the Nigerian equities market, resulting in a sustained weak interest from foreign investors. 

The analysts foresee domestic investors maintaining their stronghold in the domestic equities market over the short-to-medium term, despite the expectation that high yields from fixed income instruments may dampen domestic investors’ appetite for equities. 

Cordros Securities Limited also posited that although foreign investors are likely to adopt a cautious stance in the near term, foreign participation in the Nigerian stock market is expected to gradually recover over the medium term. They based their prediction on the current administration’s efforts to undo the damage of the previous administration’s ‘eight years of policy mistakes,’ expecting that policy reforms and announcements will eventually attract foreign investors and breathe new life into the market.