SAT, APRIL. 29 2023-theGBJournal| According to the Domestic and Foreign Portfolio Report of the Nigerian Exchange (NGX), total transactions in the domestic equities market declined for the second consecutive month, falling by 22.6% m/m to N146.22 billion in March (February: N188.91 billion).
On the one hand, foreign transactions (-53.2% m/m to N9.19 billion | 6.3% of total transactions) declined to a new record low, primarily due to the lingering FX liquidity constraints, weak macro narrative, heightened global uncertainties, and elevated global interest rates.
On the other hand, domestic transactions (93.7% of gross transactions) fell to the lowest level in four months, after declining by 19.1% m/m to N137.03 billion.
Looking ahead, we expect domestic investors to continue to dominate the local bourse, even as higher FI yields may constrain buying activities.
Also, FPIs who have exhibited a lacklustre interest in domestic equities are likely to remain on the sidelines due to elevated global uncertainties, sustained FX liquidity challenges, and tightening global financing conditions.
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