Foreign investors sell off N576bn Nigerian stocks in six months

Foreign investors sold off equities worth N576.09bn on the Nigerian Exchange between January and June 2025, representing an 84.97 per cent increase from the N311.41bn withdrawn in the same period of 2024.

The outflows exceeded foreign inflows, which stood at N559.25bn, resulting in a net negative foreign portfolio position of N16.84bn over the six months. The figures, contained in the NGX’s June 2025 Domestic and Foreign Portfolio Investment Report, show that foreign trading activity has intensified compared to the same period last year.

Total foreign transactions reached N1.14tn in the first half of the year, more than double the N540.48bn recorded in H1 2024, as economists attributed the surge in outflows to the inconsistencies caused in global markets by the policies of US President Donald Trump, the high yields in T-bills that spurred sell-offs, among others.

Meanwhile, domestic investors accounted for N3.06tn worth of trades between January and June 2025, representing 72.92 per cent of total market transactions. This marks a 41.5 per cent increase from N2.17tn in the same period of 2024. Of the total domestic figure, institutional investors contributed N1.59tn, while retail investors traded N1.47tn.

The near-parity between retail and institutional activity suggests balanced domestic participation over the half-year, though recent months show institutions gaining dominance. Altogether, the total value of transactions on the Exchange during the six-month period amounted to N4.19tn, up 60.98 per cent from N2.60tn recorded in H1 2024.

This rise, though positive in volume, masks growing concerns over the quality of capital flows, particularly the surge in foreign outflows and declining retail activity. A breakdown of monthly data reveals volatile investor behaviour, with large fluctuations in both foreign and domestic trades.

In January 2025, total transactions stood at N346.23bn, split between N269.39bn domestic and N76.84bn foreign. Retail and institutional domestic trades were almost evenly split at N134.17bn and N135.22bn, respectively. By February, activity climbed to N448.52bn. Foreign inflows were N43.67bn, and outflows were N47.93bn, reflecting modest net negative flows. Retail participation dropped to N123.38bn, while institutional trades rose to N170.54bn, indicating a gradual institutional build-up.