NSE reports N186.66bn foreign investors outflow in Q1


By Kayode Tokede

The Nigerian Stock Exchange (NSE) has reported a total of N186.66 billion foreign investors outflow from the equities market in first quarter (Q1) of 2020.

This is coming on the heels of caution trading over the widespread of Covid-19 globally, leading to foreign investors exiting the nation’s capital market.

According to NSE’s Domestic & Foreign Portfolio Investment (FPI) report, foreign investors outflow in prior first quarter was N124.24billion in the equities market.

On foreign investors’ inflow, the report by NSE stated that N65.27 billion was recorded in Q1 2020 as against N97.63 billion foreign investors inflow reported in Q1 2019.

On domestic investors’ participation, the report by the NSE explained that domestic retail investors traded N171.45billion in Q1 2020 as against N98.1billion traded in the equities market in Q1 2019 while domestic institutional investors traded N203.53billion in Q1 2020 as against N100.29 billion traded in Q1 2019.

The reported stated that a total of N626.87billion traded by both domestic and foreign investors compared to N420.26billion reported in Q1 2019.

The breakdown revealed that foreign investors traded N251.87billion or 40.18 per cent as against domestic investors that traded N374.98billion or 59.82 per cent of the total transaction on  the equities market.

On a monthly basis, The NSE polls trading figures from market operators on their Domestic and FPI flows showed that   as at  March 31, 2020, total transactions at the nation’s bourse increased by 63.58per cent from N148.50billion (about $484.60million) in February 20205 to N242.91billion (about $630.04million) in March 2020 .

The performance of the current month when compared to the performance in March 2019 (N110.11billion) revealed that total transactions increased by 120.60per cent. In March 2020, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 10per cent.

The report explained that, “A further analysis of the total transactions executed between the current and prior month (February 2020) revealed that total domestic transactions increased by 71.97 per cent from N77.16 billion in February to N132.69 billion in March 2020.

“Also, total foreign transactions increased by 54.50 per cent from N71.34 billion (about $232.79million) to N110.22 billion (about $285.89million) between February and March 2020.

“The value of domestic transactions executed by Institutional Investors outperformed Retail Investors by 10per cent. A comparison of domestic transactions in the current and prior month (February 2020) revealed that retail transactions increased significantly by 103.72 per cent from N29.56 billion in February 2020 to N60.22 billion in March 2020.

“Similarly, the institutional composition of the domestic market increased by 52.23per cent from N47.60 billion in February 2020 to N72.46 billion in March 2020.”

The report by NSE disclosed that over a 13 years period, domestic transactions decreased by 72.30per cent from N3.556trillion in 2007 to N985billion in 2019 whilst foreign transactions increased by 53.08per cent from N616billion to N943billion over the same period.

“Total domestic transactions accounted for about 51per cent of the total transactions carried out in 2019, whilst foreign transactions accounted for about 49per cent of the total transactions in the same period. The actual performance referenced 2020A (2020 Actual) shows that total foreign transactions carried out year till date (YTD) is about N251.87 billion whilst total domestic transactions YTD is about N374.98 billion.”