Foreign investors interest in Nigeria equity drops 54% in half year 2016

By Kayode Ogunwale

 

 

Foreign exchange crises rocking Nigeria economy has caused foreign investors to stay away from Nigerian equity market so far in 2016.

Available statistics from the Nigerian Stock Exchange (NSE) affirmed inability of foreign investors to participate in equity segment of the bourse as foreign transactions decline by 54.29 per cent in half year 2016.

The NSE polls trading figures from major custodians and market operators on their Foreign Portfolio Investment (FPI) flows, shows that total transactions decreased by N319.77 billion in half year 2016 from N588.99 billion of 2015 to N269.22 billion, whilst the total domestic transactions decreased by 32.34 per cent from N525 billion to N355.19 billion.

More so, the foreign inflow dropped from N285.40 billion recorded in half yard 2015 to N121.29 billion at the end of half year 2016. While the outflow decline from N303.59 billion to N147.92 billion in half year 2016.

Whereas, FPI transactions rose by N39.19 billion in June 2016 when compared with N40.58 billion of May 2016 to end June at N79.77 billion.

The total transaction during the half year significantly decrease from N1.114 trillion in half year 2015 to N624.41 billion at the end of 2016 half year.

Meanwhile, total transactions at the nation’s bourse between May and June increased by 49.97 per cent from N103.92 billion recorded in May 2016 to N155.85 billion in June 2016.

Domestic investors conceded about 2.33 per cent to their foreign counterparts. Domestic transactions increased by 20.11 per cent from N63.34 in May 2016 to N76.08 in June 2016.

FPI transactions increased by 96.57 per cent from N40.58 billion in May 2016 to N79.77 billion in June 2016.

Monthly foreign inflows slightly outpaced outflows as foreign inflows increased by 102.58 per cent from N20.96 billion in May to N42.46 billion while foreign outflows also increased by 90.11 per cent from N19.62 billion to N37.30 billion within the same period.

The highlights of domestic composition of transactions on the exchange between January and June 2016 indicates that, the total domestic transactions increased by 20.11 per cent from May to June 2016.

The institutional composition of the domestic market increased by 27.37 per cent from N30.65 billion in May to N39.04 billion. The retail composition increased by 13.31 per cent from N32.69 billion in May to N37.04 billion in June.