The Domestic & Foreign Portfolio Investment Report of the Nigerian Exchange Limited (NGX) has shown that foreign inflow into the NGX declined to the lowest point of the year at N11.26 billion in September.
The report further indicated that as foreign inflow weakened, foreign investors increased the amount of their investments that they liquidated between August and September.
Foreign inflow into Nigeria in the first nine months of 2024 was N310.99 billion higher than N108.93 billion in 2023. The highest value of inflow was recorded in May 2024, N54.87 billion and it has steadily declined since then to N11.26 billion in September.
In terms of foreign outflow, it worsened to N30.15 billion in September compared to N24.38 billion in August.
The NGX report further revealed that as of 30 September 2024, total transactions at the local bourse increased significantly by 29.90 per cent from N379.52 billion (about $237.70 million) in August 2024 to N493.01 billion (about $307.84 million) in September 2024.
The performance of the current month, when compared to the performance in September 2023 (N295.80 billion) revealed that total transactions increased by 66.67 per cent. In September 2024, the total value of transactions executed by Domestic Investors outperformed transactions executed by Foreign Investors by circa 84 per cent.
“A further analysis of the total transactions executed between the current and prior month (August 2024) revealed that total domestic transactions increased by 40.23 per cent from N322.05bn in August 2024 to N451.60bn in September 2024. However, total foreign transactions decreased by 27.95 per cent from N57.47bn (about $35.99m) to N41.41bn (about $25.86m) between August 2024 and September 2024,” the report added.
It also stated that in the month under review, retail Investors outperformed Institutional Investors by 28 per cent. A comparison of domestic transactions in the current month and the prior month (August 2024) revealed that retail transactions increased by 59.42 per cent from N180.72 billion in August 2024 to N288.10 billion in September 2024.
Meanwhile, the NGX has proposed new rules on block divestment and large-volume trades.
Market stakeholders were invited to share their feedback on the proposed rules in a notice to trading licence holders signed by the Chief Executive Officer of the NGX Regulation Limited, Olufemi Shobanjo, on Friday.
The amendment is to Trading Licence Holders Rules (Part XIIIA) on Block Divestments and Large Volume Trades.
The proposed change includes that “trade shall be treated as a block divestment where it involves: a) a transfer of shares amounting to five per cent,” it used to be 30 per cent.
“A transfer of shares or acquisition of additional shares amounting to five per cent or more of the company’s total listed shares within a period of one year from the date of first transfer or acquisition of shares.
“Where The Exchange identifies a pattern of transactions suggesting a continued divestment process beyond the one-year threshold, such transactions may, at the discretion of The Exchange, be treated as a Block Divestment and subject to the applicable rules and requirements,” it stated.
