Foreign portfolio investments rise 88.5% to N118.9bn

Foreign portfolio investments in Nigeria showed a strong rebound in May 2025, with the value rising sharply by 88.5% to N118.91 billion compared to N63.07 billion in April. This improvement was partly driven by moderating fixed income yields and better market sentiment, which increased foreign investors' demand in the equities market.

Data from the Nigerian Exchange (NGX) Domestic and Foreign Portfolio Report revealed that total transaction volume grew significantly by 45.3% month-on-month (MoM) to N700.50 billion in May, up from N482.04 billion in April. This surge was largely fueled by higher participation from domestic investors, who accounted for 83% of total transactions, while foreign investors contributed 17%.

Breaking down the domestic activity, domestic investors increased their stakes by 38.8% MoM to N581.59 billion from N418.97 billion in April. The rise was mainly due to increased transactions by retail investors, representing 86.1% MoM growth, with institutional investors contributing a smaller 2.7% increase.

Despite the overall growth in transactions, net portfolio flows declined by 54% MoM to N2.64 billion, down from N5.74 billion. This was because strong net foreign inflows of N13.31 billion were offset by domestic net outflows of N10.67 billion.

Market analysts at Cordros Capital expect domestic investors to remain the main drivers of transaction value in the near term. They highlighted that a continuing decline in fixed income yields could sustain buying interest among these investors. Additionally, the relative stability of the naira is likely to attract more foreign investor participation in equities. However, they also cautioned that ongoing global uncertainties could pose risks to maintaining these inflows.

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