SAT, JULY 01 2023-theGBJournal |According to the Domestic and Foreign Portfolio Report of the Nigerian Exchange (NGX), total transactions on the local bourse increased by 68.9% m/m to N322.92 billion in May (April: N191.21 billion), its highest level since May 2022 (N607.25 billion).
In analyzing the breakdown provided, domestic transactions (88.5% of total transactions) grew by 56.4% m/m to N285.75 billion while foreign transactions (11.5% of market transactions) also printed higher at N37.16 billion (April: N8.47 billion).
Notably, net foreign transactions (N17.86 billion) settled at their highest level since December 2017, likely due to investors’ optimism about reforms from a new administration.
Analysts at Cordros Research tell theGBJournal that they expect domestic investors to continue to dominate the domestic equities market over the short-to-medium term, even as higher FI yields may constrain buying activities.
”At the same time, while foreign investors are likely to adopt a wait-and-see approach in the near term, we expect to see improvement in foreign participation over the medium term.”
Cordros expectation is hinged on the policy pronouncements and reforms by the current administration, undoing the policy mistakes of the past eight years.
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