Foreign investors withdrew N45.85bn from the Nigerian stock market in January 2025, an outflow that significantly overshadowed the N25.66bn recorded as foreign inflows within the same period.
The latest Nigerian Exchange Domestic and Foreign Portfolio Investment Report revealed that foreign outflows accounted for 64.12 per cent of total foreign transactions on the exchange, reinforcing concerns over declining foreign participation in the market despite the relative stability of the naira.
It showed that total foreign transactions increased by 7.13 per cent, rising from N66.75bn in December 2024 to N71.51bn in January 2025.
According to the analysis by Punch newspaper on Monday, this increase was, however, largely driven by investors liquidating their holdings, as evidenced by the much larger outflow compared to inflows.
It noted that this trend indicates that while some foreign investors may still engage with the Nigerian market, a greater proportion opt to exit, contributing to capital flight.
The withdrawal of foreign funds from the market came amid a 9.89 per cent decline in total equity transactions on the NGX, which fell from N673.66bn in December 2024 to N607.05bn in January 2025.
On a year-on-year basis, total transactions dropped by 6.83 per cent from N651.52bn recorded in January 2024.
This suggests that investor sentiment remained subdued as both foreign and domestic players exercised caution in response to prevailing economic conditions.
The report read, “On a monthly basis, Nigerian Exchange Limited polls trading figures from market operators on their Domestic and Foreign Portfolio Investment flows.
“As at 31 January 2025, total transactions at the nation’s bourse decreased by 9.89 per cent from N673.66bn (about $438.64m) in December3 2024 to N607.05bn (about $410.84m) in January 2025.
“The performance of the current month when compared to the performance in January 2024 (N651.52bn) revealed that total transactions decreased by 6.83 per cent. In January 2025, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 76 per cent.”
The report further disclosed that foreign investors’ share of total market transactions stood at 11.78 per cent, with domestic investors dominating with 88.22 per cent.