NSE Records 97% increase in Foreign Investment Outflows

The Nigerian Stock Exchange (NSE), has recently revealed that there was a significant growth of 97.8 per cent in Foreign Portfolio Investment (FPI) outflows in the month of February.

In the Domestic & Foreign Portfolio Participation in Equity Trading for the Month of February, has showed that foreign outflows increased by 97.8 per cent from N27.81 billion in January, to N55.01 billion.

According to NSE, the FPI outflow includes sales transactions or liquidation of portfolio investments through the stock market, whilst the FPI inflow includes purchase transactions on the Nigerian Stock Exchange (Equities only).

However, the Nigerian stocks market appreciated by 3.8 per cent in the month of February compared with a decline in January. The Nigerian Stock Exchange (NSE) All-Share Index (ASI) rose from 30,557.20 to close at 31,721.76 while market capitalisation gained N434 billion, rising from N11.395 trillion to N11.829 trillion at the end of the month.

The period coincided with uncertainty that followed Nigeria’s general elections, the first of which was the Presidential and National Assembly polls, held on February 23, after a one-week postponement from the initial date, while governorship and State Assembly elections held on March 9, 2019.

Although the elections are long over, they were declared inconclusive in some states including Kano, the commercial capital of Northern Nigeria, Bauchi in the North East, Sokoto and oil rich Rivers, among others, just as the main opposition Peoples Democratic Party (PDP) is already challenging the outcome of the Presidential election.

Foreign investments inflow for the period also rose by a significant 91.24 per cent from N22.97 billion in January to N43.93 billion. Total transactions on the bourse for the period climbed by 54.06 per cent from N122.08 billion to N188.08 billion (representing about $613.9 millio) in February 2019, but when compared to trading figures in the corresponding month of 2018, it showed a drop by 11.30 per cent.

Total value of transactions executed by foreign investors in February 2019 outperformed those by domestic investors by six per cent, just as transactions executed revealed that total foreign transactions increased by 48 per cent from N66.85 billion in January 2019 to N98.94 billion.

Transaction value in the domestic market, institutional investors’ outperformed retail investors by eight per cent, even as the total retail transactions grew by 38.26 per cent from N29.66 billion in January.