Domestic investors remained the main drivers of the nation’s capital market following the execution of 90.78 percent of the total transactions that took place on the Nigerian Exchange Group (NGX) from January to August 2023. This compares to 84.03 percent of the trade executed on the same platform from January to August of 2022.
By value, the January to August 2023 trade amounted to N2.19 trillion as against N1.59 trillion in the comparable period of 2022.
“On a monthly basis, Nigerian Exchange Limited polls trading figures from market operators on their Domestic and Foreign Portfolio Investment (FPI) flows. As at 31 August 2023, total transactions at the nation’s bourse decreased by 62.65% from N702.98billion (about $991.91million) in July5 2023 to N262.56billion (about $338.13million) in August 2023.
“The performance of the current month when compared to the performance in August 2022 (N123.97billion) revealed that total transactions increased by 111.79%. In August 2023, the total value of transactions executed by Domestic Investors outperformed transactions executed by foreign investors by circa 72%,” NGX said.
It should be noted that in the last one year, the Nigerian domestic investors have been the ones driving activities on the NGX with minimal foreign participation. In January 2023, 87.24 percent of the transactions on the NGX were traded by domestic investors. That was followed by 89.61 percent in February and another 93.71 percent in March.
At the beginning of the second quarter of this second, domestic investors traded 95.57 percent of the total transactions that took place on NGX, which remains the highest trade accounted for by local investors during the first eight months of this year. With 88.75 percent of the trade on the local bourse, the share of trade by foreign investors surged to 11.51 percent in May, recovering from 4.43 percent in April 2023.
The level of trade remained almost the same in June as foreign investors accounted for 11.25 percent of the trade on the NGX, but sharply fell to 5.77 percent in July when the share of local traders in NGX trading activities recovered, increasing to 94.23 percent in July.
Foreign interest in August 2023 trading activities on NGX rose to 14.15 percent as against 85.85 percent by domestic investors.
“A further analysis of the total transactions executed between the current and prior month (July 2023) revealed that total domestic transactions decreased by 65.97% from N662.44billion in July to N225.40billion in August 2023. Similarly, total foreign transactions decreased marginally by 8.34% from N40.54billion (about $52.58million) to N37.16billion (about $47.94million) between July 2023 and August 2023,” NGX added.
