Foreign investment in Nigeria’s stock market dropped by N36.7bn in January – Report

Foreign investment into the nation’s stock market dropped to N36.7 billion in January.

The Nigeria Stock Exchange disclosed this in its report on monthly domestic and Foreign Portfolio Investment (FPI) flows obtained by Ripples Nigeria on Monday.

FPI refers to the purchase of securities and other financial assets by investors from another country.

Examples of FPIs include stocks, bonds, and mutual funds.

The total transactions dropped by 13.66 percent from N269.24 billion recorded in December 2020 to N232.46 billion ($590.82 million) in January.

The figure was 1.27 percent lower than the N235.46billion recorded in January 2020.

A further analysis revealed that the total value of transactions undertaken by domestic investors outperformed transactions executed by their foreign counterparts by 60 percent.

The report read: “Total domestic transactions decreased by 7.21 percent from N199.32 billion in December to N184.94 billion in January 2021.

“Similarly, total foreign transactions decreased by 32.04 percent from N69.92billion in December (about $178.44 million) to N47.52 billion (about $120.78million) in January 2021.”

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A comparison of domestic transactions also revealed that retail transactions increased by 10.16 percent from N61.22 billion in December 2020 to N67.44 billion in January.

However, the institutional composition of the domestic market decreased by 14.91 percent from N138.09 billion in December 2020 to N117.50 billion in January.

Over a 14-year period, domestic transactions decreased by 59.54 percent from N3.56 trillion in 2007 to N1.44 trillion in 2020 while foreign transactions increased by 18.45 percent from N616 billion to N729 billion over the same period.

Domestic transactions accounted for 74 percent of the total transactions carried out in 2020 while foreign transactions contributed 26 percent of same in the same period.

The report also revealed that foreign transactions were N47.52billion while domestic transactions stood at N184.94 billion in January.

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