Stock market wobbles as foreign investors withdraw N243.35bn

Foreign Portfolio Investors have pulled out N243.35bn from the Nigerian capital markets in seven months primarily due to the bearish performance of the market in recent times.

According to the data from the Nigerian Stock Exchange, the latest outflow has taken the total net withdrawal by foreign portfolio investors from the capital markets to N243.35bn this year so far, an improvement from the N400.48bn recorded in the same period in 2018.

Foreign investors outperformed domestic investors by two percent in July 2019 as there was a decrease of 72.22 percent in total domestic transactions from N200.51bn in June to N55.69bn in July 2019.

Similarly, total foreign transactions decreased by 40.27 percent from N96.74bn (about $315.7m) to N57.78bn (about $188.6m) between June and July 2019.

The value of domestic transactions executed by institutional investors outperformed retail investors by eight per cent.

A comparison of domestic transactions in July and June revealed that retail transactions decreased by 83.59 percent from N155.12bn in June 2019 to N25.44bn in July 2019.

However, the institutional composition of the domestic market reduced by 33.28 percent from N45.34bn in June 2019 to N30.25bn in July 2019.

Over a 12-year period, domestic transactions decreased by 66.68 per cent from N3.556tn in 2007 to N1.185tn in 2018 while foreign transactions increased by 97.88 percent from N616m to N1.219tn within the same period.

Total foreign transactions accounted for about 51 percent of the total transactions carried out in 2018, while domestic transactions accounted for about 49 per cent of the total transactions in the same period.

The actual performance showed that total foreign transactions carried out year-to-date was about N530.56bn while total domestic transactions year-to-date was about N670.42bn.

However, as of July 31, 2019, total transactions at the nation’s bourse decreased by 61.82 percent from N297.25bn (about $970.1m) in June 2019 to N113.47bn (about $370.4m) in July 2019.

The performance in July, when compared to the performance in the same period of 2018, revealed that total transactions also decreased by 22.31 percent.