Institutional investors boost equities trading in January 2017

 

TRADING activities on the floor of the Nigerian Stock exchange (NSE) was enhanced by institutional investors in the month of January 2017 outperform retail counterparts.

The highlights of domestic composition of transactions on the exchange in January 2017 indicate that the institutional composition of the domestic market accounted for 61 percent whilst the retail composition accounted for 39 percent in the same period. This indicates more active participation by institutional investors over their retail counterparts in the period under review.

The NSE polls trading figures from major custodians and market operators on their Foreign Portfolio Investment (FPI) at the end of January 2017 shows that domestic institutional investors transacted N31.19 billion over N20.12 billion traded by domestic retail investors.

However, total transactions at the nation’s bourse decreased by 0.58 percent from N95.88 billion recorded in December 2016 to N95.32 billion in January 2017. In comparison to the same period in 2016, total transactions increased by 13.34 percent from the N84.10 billion recorded in January 2016.

Foreign investors conceded about 7.65 percent of trading to domestic investors. Total foreign transactions decreased by 0.02 percent from N44.02 billion recorded in December 2016 to N44.01 billion in January 2017. Domestic transactions also decreased by 1.06 percent from N51.86 billion to N51.31 within the same period.

Meanwhile, monthly foreign inflows outpaced outflows. There was a 16.01 percent increase in foreign inflows from N19.49 billion in December 2016 to N22.61 billion in January 2017. Foreign inflows decreased by 12.76 percent from N24.53 billion in December 2016 to N21.40 billion in January 2017.

Since 2011, foreign transactions have consistently outperformed domestic transactions. Though, domestic transactions slightly outperformed foreign transactions in 2016, accounting for 55 percent of the total transaction volume in 2016.

Also, foreign transactions have further declined by 66.34 percent from N1.539 trillion in 2014 to N518 billion in 2016, representing circa 45 percent of total transactions in 2016.

Over the nine year period, domestic transactions have significantly decreased by 85.43 percent from N3.556 trillion in 2007 to N634 billion in 2016.