The Nigerian Exchange Limited (NGX), on Friday reported that equity transactions worth N322.92bn were consummated in the month of May, up by N131.71bn, or 68.88%, when compared to N191.21bn in the preceding month.
According to data on the Domestic and Foreign Portfolio Investment Report of the NGX, this is prolonged foreign exchange scarcity, inflation among others took their toll on the Nigerian economy and the capital market which is the barometer of the economy, leading to mixed sentiments in transactions during the period under review.
The securities market hit the biggest single day gain in two years, when its All-Share Index soared 5.23% up on May 30 as investors reacted positively to announcement by President Bola Tinubu removing subsidy on petrol, and the immediate unification of exchange rates.
Tinubu also announced plans by his administration to target better growth in Gross Domestic Product (GDP), create jobs, and ensure that investors and foreign businesses repatriate their hard earned dividends and profits.
This, the statement continued, resulted in a huge bounce as the total value of transactions executed by domestic investors outperformed those of foreign Investors by a significant 76%.
Further analysis of the total transactions during the period revealed that the domestic component increased by 56.37% from N182.74bn in April to N285.76bn in May 2023, while total foreign share increased significantly by 338.72% from N8.47bn (about $18.31m) to N37.16bn (about $79.88m) between April 2023 and May 2023.
Over a 16-year period, the report continued, domestic transactions decreased by 45.3% from N3.556bn in 2007 to N1.945tr in 2022, whilst foreign transactions also decreased by 38.47% from N616bn to N379bn over the same period.
Also, total domestic transactions stood at N945.02bn, whilst total foreign transactions closed the month under review at N99.34bn, just as institutional investors outperformed retail Investors by 38% while a comparison of domestic transactions in the current and prior month (April 2023) revealed that retail transactions increased by 19.29% from N74.19bn in April to N88.5bn in May 2023.
Similarly, the institutional composition of the domestic market increased significantly by 81.72% per cent from N108.55bn in April 2023 to N197.26bn in May 2023.