MON JULY 01 2024-theGBJournal| According to the Domestic and Foreign Portfolio Report of the Nigerian Exchange (NGX), total transactions in the domestic equities market increased by 2.6% m/m to N355.38 billion in May (April: N346.23 billion).
The performance, according to the data, was due to a broad-based increase in participation from both domestic (65.0% of gross transaction) and foreign (35.0% of gross transaction) investors.
Analysing the breakdown, inflows from domestic investors increased by 2.5% m/m to N231.10 billion (April: N225.40 billion), supported by a 12.7% m/m surge in inflows from retail investors, amid a 5.7% m/m decline in inflows from institutional investors.
At the same time, inflows from foreign investors increased by 2.9% m/m to N124.28 billion in May (April: N120.83 billion).
While we expect domestic investors to continue to contribute the most to total transaction value, we think buying activities will be constrained by elevated yields in the fixed income market following the Monetary Policy Committee’s tight monetary policy stance.
On the other hand, we expect the improved FX market liquidity and reduced naira volatility to support foreign investor participation in the equities market.
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