Paragraph 1: Surge in Foreign Investments Fuels Nigerian Stock Market Growth
The Nigerian Exchange Limited (NGX) witnessed a remarkable surge in foreign portfolio investments in May 2025, reaching a total of N118.9 billion. This represents a significant increase of 88.54% compared to the N63.07 billion recorded in April 2025. This influx of foreign capital, equivalent to approximately $74.97 million at the prevailing exchange rate, played a crucial role in boosting overall market activity. Total transactions on the NGX jumped by an impressive 45.32% from N482.04 billion in April to N700.50 billion in May, highlighting the strong positive impact of increased foreign participation. This surge in foreign investment signals renewed confidence in the Nigerian economy and its potential for growth, attracting international investors seeking profitable opportunities.
Paragraph 2: Year-to-Date Performance and Investor Composition
Analyzing the year-to-date figures for 2025 reveals a significant contribution from foreign investors to the Nigerian stock market. Foreign transactions have reached a substantial N996.03 billion, constituting 29.17% of the total market transactions. While this demonstrates a notable presence of foreign investors, domestic investors continue to maintain their dominant position, accounting for 70.83% of total market participation. This underscores the continued importance of local investors in driving market activity and shaping the overall performance of the Nigerian stock market. The balance between foreign and domestic investment contributes to a more stable and resilient market environment.
Paragraph 3: Domestic Investor Activity and Retail Investor Dominance
Domestic transactions also experienced robust growth in May 2025, increasing by 38.81% to reach N581.59 billion. Notably, retail investors outperformed institutional investors by a significant margin of 16%. This surge in retail investment activity was driven by an impressive 86.12% increase in retail trades, rising from N181.31 billion in April to N337.46 billion in May. This indicates a growing interest from individual investors in participating in the stock market, potentially driven by factors such as increased financial literacy, improved access to online trading platforms, and a desire for higher returns compared to traditional savings instruments.
Paragraph 4: Year-on-Year Market Performance and Historical Context
Comparing the market activity in May 2025 with the same period in 2024 reveals a dramatic increase in overall transactions. Total transactions in May 2025 more than doubled, surging by an impressive 97.11% from N355.38 billion in May 2024. This significant year-on-year growth reflects a substantial improvement in market sentiment and investor confidence in the Nigerian economy. It also suggests a broader positive trend in market activity, potentially driven by various factors including improved economic performance, favorable regulatory policies, and increased investor awareness.
Paragraph 5: Long-Term Dominance of Domestic Investors
Data released by the Nigerian Exchange Limited highlights the consistent and significant role played by domestic investors in shaping the Nigerian equities market. Between January 2024 and May 2025, domestic investors drove a staggering N9.0 trillion worth of transactions. This underscores the long-term dominance of local investors and their crucial contribution to market liquidity and stability. The continued engagement of domestic investors provides a solid foundation for the market, even during periods of volatility or fluctuations in foreign investment flows.
Paragraph 6: Importance of Domestic Investor Participation
The sustained dominance of domestic investors in the Nigerian stock market has several important implications. Firstly, it demonstrates a growing level of financial inclusion and participation within the Nigerian economy, with more individuals and institutions engaging in investment activities. Secondly, it provides a buffer against external shocks and fluctuations in global markets, ensuring greater resilience in the Nigerian stock market. Finally, the active involvement of domestic investors fosters local ownership and control of the market, contributing to long-term economic growth and development. This consistent participation from within the country reinforces the stability and sustainability of the Nigerian stock market.
