….Surpass Foreign Transactions By 317.73%
The Nigerian Exchange Limited recorded a substantial rise in domestic transactions for the first seven months of 2024, totaling N2.498trn.
This figure significantly outpaced the N598bn in foreign transactions over the same period.
The information was disclosed in the NGX’s July 2024 Domestic and Foreign Portfolio Investment report, as obtained by NewsNGR.
An analysis of the report reveals that domestic transactions exceeded foreign investor activity by N1.9tn, representing 317.73 per cent increase.
This disparity is largely driven by low foreign investor sentiment, which has been dampened by economic uncertainty.
Foreign portfolio investors typically reduce their exposure in volatile markets, contributing to the subdued foreign participation.
As of July 31, 2024, the total value of transactions on the NGX saw a significant 38.66 per cent increase, rising from N354.55bn (approximately $241.06m) in June 2024 to N491.61bn (approximately $305.02m) in July 2024.
However, a year-on-year comparison showed that the total transaction value in July 2024 represented a 30.07 per cent decline compared to the N702.98bn recorded in July 2023.
For July 2024, domestic investors accounted for approximately 76 per cent of total transaction value, once again outperforming foreign investors.
A further analysis of the total transactions executed between the current and prior month (June 2024) revealed that total domestic transactions increased by 59.38 per cent from N272.36bn in June 2024 to N434.09bn in July 2024.
However, total foreign transactions decreased by 30.02 per cent from N82.19bn (about $55.88m) to N57.52bn (about $35.69m) between June 2024 and July 2024.
According to the report, retail investors outperformed institutional investors by 26 per cent.
A comparison of domestic transactions in July and prior month (June 2024) revealed that retail transactions increased significantly by 138.48 per cent from N114.02bn in June 2024 to N271.92bn in July 2024.
Also, the institutional composition of the domestic market increased by 2.42 per cent from N158.34bn in June 2024 to N162.17bn in July 2024.
Over a seventeen (17) year period, domestic transactions decreased by 10.94 per cent from N3.56tn in 2007 to N3.167tn in 2023; whilst foreign transactions also decreased by 33.28 per cent from N616bn to N411bn over the same period.
Total domestic transactions accounted for about 89 per cent of the total transactions carried out in 2023, whilst foreign transactions accounted for about 11 per cent of the total transactions in the same period.