Market News

By Peter Egwuatu

Foreign Portfolio Investments, FPIs, inflows through the Nigerian stock market grew by 126.8 % at the end of December 2024 to N396.41 billion from N174.82 billion in the full year 2023.

Investment analysts have attributed the development to the monetary policy regime of the Central Bank of Nigeria, CBN, which pushed up interest earnings on portfolio investments since last year.

However, Vanguard’s findings from the data released by the Nigerian Exchange Limited, NGX, showed that the foreign investment outflow also increased by 93.2 % to N455.62 billion from N235.82 .83 billion in 2023.

The total foreign transactions (Inflow & Outflow) Year-to-Date, YtD, stood at N852.03 billion indicating a 107.5% jump from N410.64 billion in 2023.

The data further revealed that domestic investors recorded N4.734 trillion transactions accounting for 84.7% of the total N5.586 trillion value of transactions recorded by the Nigerian Exchange, NGX, YtD.

The retail investors recorded N2.306.trillion in 2024 against N1.120 trillion in 2023, while domestic institutional investors recorded N2.428 trillion in 2024 against N2.047 trillion recorded in 2023.

Meanwhile, the data as at 31 December 2024 showed that total transactions at the nation’s bourse increased by 52.29% from N442.34 billion (about $265.93 million) in November 2024 to N673.66 billion (about $438.64 million) in December 2024.

The performance of the 2024 figure when compared to the performance in December 2023 revealed that total transactions executed by investors on the NGX significantly increased by    56.1% to N5.586 trillion from N3.357 trillion in 2023. Also the total value of transactions executed by domestic investors outperformed transactions executed by Foreign Investors by circa 80%.

The institutional investors outperform retail investors by 5.3 % in the period under review. Specifically, institutional investors recorded N2.428 trillion from N2.047 trillion in 2023 representing 18.5 % increase,      ,while retail investors posted N2.306 trillion in 2024 against N1.120 trillion in 2023, indicating 105.9 increase.

Reacting to the increased FPIs , David Adonri, Vice Chairman, Highcap Securities, said: “When FPIs flow into the stock market, it impacts the foreign exchange market positively as the rate in the FX market is determined by demand and supply dynamic.

This, in turn, also boosts foreign reserves. Increase in FPI is also indicative of rising foreign investors’ confidence in the stock market and the economy at large.”