Trading activities on the Nigerian Exchange Limited witnessed a notable contraction during February 2025, with total transactional value decreasing by 16.07 percent, registering N509.47bn, down from the N607.05bn recorded in January.
This contraction was primarily attributed to a substantial exodus of overseas investors, whose transactional volume plummeted by 40.36 percent, from N71.51bn to N42.65bn within the specified month.
Findings from the NGX’s Domestic and Foreign Portfolio Investment Report, released this Monday, revealed that overseas inflows diminished by 29.67 percent, dropping to N18.05bn from N25.66bn in January, while overseas outflows also contracted by 46.33 percent, sliding to N24.60bn from N45.85bn.
The reduction in foreign participation consequently lowered their overall trading share to a mere 8.37 percent, contrasting with the 11.78 percent observed in January, thus emphasizing the continued dominance of local investors within the equities market.
Conversely, domestic investors maintained their market control, accounting for 91.63 percent of total transactions. However, their trading volume also experienced a downturn, receding by 12.83 percent, from N535.54bn in January to N466.82bn in February.
An analysis of domestic transactions indicated that retail investors contributed N214.51bn, representing a 19.76 percent decrease from N267.35bn in January, while institutional investors accounted for N252.31bn, a 5.92 percent reduction from N268.19bn in the preceding month.
The decline in overseas transactions underscores growing concerns regarding investor confidence within Nigeria’s capital market.
On a year-to-date basis, total transactions for the initial two months of 2025 amounted to N1.12tn, with domestic investors contributing N1tn, representing 89.78 percent, while overseas investors contributed N114.16bn, constituting 10.22 percent.
In comparison to the corresponding period in 2024, which recorded total transactions of N1.01tn, there was an increment of 10.62 percent in market activity. However, the proportion of overseas participation has continued to diminish from 11.78 percent in 2024 to 10.22 percent in 2025.
Data spanning the past 18 years reveals that domestic participation within the Nigerian equities market has exhibited consistent growth, expanding by 33.15 percent from N3.56tn in 2007 to N4.73tn in 2024, while overseas transactions increased by 38.31 percent from N616bn to N852bn during the same timeframe. Despite this expansion, overseas participation has remained relatively subdued, averaging only 15 percent of total transactions in 2024, with domestic investors accounting for 85 percent.
It was reported that overseas investors withdrew N455.62bn from the Nigerian stock market in 2024, significantly exceeding total inflows and reinforcing apprehensions regarding investor confidence, despite the Central Bank of Nigeria’s efforts to stabilize the naira.
