The Nigerian Exchange (NGX) recorded a total transaction value of ₦502.73 billion (approximately $300.05 million) in October 2024, reflecting a 1.97% increase from the ₦493.01 billion ($307.84 million) reported in September 2024.
While the Naira depreciated from ₦1,601.52/$1 in September to ₦1,675.49/$1 in October, leading to a lower dollar valuation despite higher nominal Naira figures, October’s performance marked the highest monthly transaction value in the second half of the year. It also ranked as the third-highest monthly total in 2024, following March (₦538.54 billion) and January (₦651.52 billion).
Year-to-date (YTD), the NGX has recorded ₦4.47 trillion ($2.67 billion) in transactions, making 2024 the second-highest annual figure in 17 years, surpassed only by the record set in 2007.
Domestic Investors Drive Market Activity
Domestic investors accounted for ₦455.27 billion ($272.25 million), or 90.56% of total transactions in October, a slight increase from ₦451.6 billion ($281.98 million) in September.
• Institutional investors fueled the growth, with their transactions surging 74.45% from ₦163.5 billion in September to ₦285.23 billion ($170.14 million) in October.
• Conversely, retail investor participation declined sharply by 40.98%, falling from ₦288.1 billion ($180 million) to ₦170.04 billion ($101.42 million) over the same period.
Foreign portfolio investments (FPI) contributed ₦47.46 billion ($28.33 million) in October, up from ₦41.41 billion ($25.86 million) in September, marking a 14.61% rise in foreign activity.
Foreign Participation: Modest Growth Amid Challenges
Foreign inflows stood at ₦33.31 billion ($19.87 million) compared to outflows of ₦14.15 billion ($8.45 million), resulting in a positive net inflow. However, foreign participation accounted for just 9.44% of total market transactions.
Persistent macroeconomic challenges, including Naira volatility and uncertainties surrounding fiscal and monetary policies, have hindered foreign investor activity. Although high interest rates set by the Central Bank of Nigeria were expected to attract foreign inflows, the equity market has yet to fully capitalize on these policy measures.
Significant Year-on-Year Growth
October’s transaction value of ₦502.73 billion ($300.05 million) represented a 127.54% increase compared to October 2023, when transactions totaled ₦220.94 billion ($138 million).
• YTD, domestic investors have contributed ₦3.73 trillion ($2.23 billion), accounting for 83.35% of total transactions, while foreign investors have contributed ₦744.34 billion ($445 million), or 16.65%.
• Since 2007, foreign transactions have declined by 33.28%, while domestic transactions have decreased by just 10.94%, underscoring the growing reliance on local capital for market liquidity and stability.
Despite ongoing challenges, including currency devaluation and reduced foreign investor interest, the NGX All-Share Index rose by 0.25% in October, bringing the market’s YTD gain to an impressive 32%. This performance reflects the resilience of the Nigerian equities market in navigating economic headwinds.
