Transactions on the local stock exchange surged to N2.35tn by May’s end, showing a notable 115.40 percent increase compared to the first five months of the previous year.
This data was disclosed in the equity trading report on domestic and foreign portfolio participation released by the Nigerian Exchange Limited on Thursday.
The report highlighted that domestic investors dominated the market, accounting for approximately N1.79tn (79.63 percent) of the transactions over five months, while foreign investors contributed N458.29bn (20.37 percent).
A closer look revealed that domestic institutional investors led with N906bn, compared to N885.19bn from domestic retail investors.
Since May 2023, Nigeria has undergone a leadership change, resulting in significant reforms such as harmonizing the foreign exchange market and removing fuel subsidies.
Experts suggest these changes will enhance the capital market and attract foreign investors. During this period, the Monetary Policy Rate was raised multiple times, reaching 26.25 percent at the May 2024 MPC meeting.
In its economic outlook titled “Navigating Economic Reforms,” PwC noted that the Nigerian Stock Exchange saw an 85.2 percent increase in market capitalization, rising from N30.3tn in May 2023 to N56.5tn in May 2024.
This growth was driven by strong performances in sectors such as oil and gas (124 percent), consumer goods (104 percent), insurance (88 percent), and banking (69 percent).
Additionally, the yield on Nigeria’s 10-Year Government Bond hit a record high of 19.30 percent in May 2024, up from 14.55 percent in May 2023, due to attractive rates on OMO and treasury bills spurred by the rising MPR.
Month over month, the NGX reported an increase in total transactions from N346.23bn in April to N355.38bn in May, reflecting a 2.64 percent growth. Domestic investor participation rose by 2.53 percent, from N225.40bn in April to N231.10bn in May.
Institutional investors outperformed retail investors by two percent, with N117.57bn compared to N113.53bn. Meanwhile, total foreign transactions increased by 2.86 percent, from N120.83bn to N124.28bn between April and May 2024.
