Market News

BY Temitope Aina

Foreign investors took the lead on the Nigerian Exchange Limited in March 2025, accounting for 62.74 per cent of total equity transactions, as the market recorded a significant spike in trading activities.

Data from the NGX’s latest Domestic and Foreign Portfolio Investment Report showed that total transactions for the month surged by 118.95 per cent to N1.12tn from N509.47bn in February.

Foreign portfolio transactions rose sharply by 1,541 per cent, climbing from N42.65bn in February to N699.89bn in March. This increase, according to the NGX, was largely due to block trades executed by foreign investors during the period.

Despite the massive growth in foreign activity, domestic transactions declined. The total value of domestic trades dropped by 10.98 per cent to N415.62bn in March, down from N466.82bn in February. Within the domestic segment, institutional investors contributed N218.50bn, while retail investors accounted for N197.12bn, showing a 6 per cent dominance by institutional players.

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Foreign inflows for the month stood at N349.97bn, almost equal to foreign outflows of N349.92bn, indicating a balanced level of buying and selling by offshore investors.

In year-to-date terms, between January and March 2025, foreign investors have injected N814.05bn into the market, making up 36.47 per cent of the total N2.23tn transactions recorded so far. Domestic investors accounted for N1.42tn, representing 63.53 per cent.

Compared to the same period in 2024, when foreign investors contributed only N213.18bn (13.77 per cent) to a total of N1.55tn, the data shows a significant increase in foreign participation this year.

The March 2025 performance also reflected a 107.14 per cent increase when compared with N538.54bn in March 2024, confirming a year-on-year improvement in market turnover.

The exchange rate, which moved from N1,492.49/$1 in February to N1,536.82/$1 in March, did not deter foreign investors, who continued to show interest in Nigerian equities despite currency volatility.

From a long-term perspective, total domestic transactions have grown by 33.15 per cent over 18 years, from N3.56tn in 2007 to N4.74tn in 2024, while foreign transactions rose by 38.31 per cent from N616bn to N852bn over the same period.

In 2024, domestic transactions made up 85 per cent of the market, while foreign participation stood at 15 per cent. However, the 2025 data suggests a narrowing gap, with foreign investors becoming increasingly active.

The NGX noted that the strong foreign inflow in March was primarily driven by large-volume block trades, often associated with institutional investments or asset reallocations.

The PUNCH reported that the Nigerian Exchange Limited recorded a sharp decline in trading activity in February 2025, as total transactions dropped by 16.07 per cent to N509.47bn from N607.05bn in January.