NGX Sees Significant Surge in Equity Transactions, Reaching N5.59 Trillion in 2024
The Nigerian Exchange Limited (NGX) reported a remarkable surge in equity transactions for 2024, with the total value rising to N5.59 trillion. This represents a 56.2% year-on-year increase compared to N3.58 trillion in 2023. Domestic investors continued to dominate the market, contributing 84.75% (N4.73 trillion) of the total transactions, while foreign investors accounted for 15.25% (N852.03 billion). Foreign participation saw an improvement from the previous year, where it stood at just 11.48% of total transactions.
The year began with a strong performance, as January alone recorded N651.52 billion in transactions, with local investors contributing 91.85%. Positive corporate earnings and favorable economic reforms, such as increased capital inflows, pushed the NGX All-Share Index up by 35.3%. However, February saw a drop in transactions to N357.88 billion, primarily due to rising inflation and profit-taking. Still, foreign participation increased to 18.39%, driven by some market adjustments.
Investor sentiment saw improvement in March, with transactions reaching N538.54 billion, and foreign investors contributing 17.5%. This uptick was supported by a stabilized naira and a GDP growth rate of 2.98% in the first quarter. The market experienced a decline in April, with total transactions dropping to N346.23 billion. Foreign investors showed more interest, accounting for 34.9%, in response to favorable policy announcements, although inflation remained elevated at 33.69%.
From May to August, the NGX saw rising transactions, largely due to the Central Bank’s adjustments to the Monetary Policy Rate (MPR), which reached 26.25% to manage inflation. September saw a decline in foreign participation, as naira volatility dissuaded foreign investments, contributing to only 8.4% of the total N493.01 billion in transactions. Despite this, strong local confidence kept the market active, and the NT-Bills market showed a bearish trend, with yields climbing to 21.92%.
By the year’s end, market activity continued to grow, bolstered by local institutional participation and an increase in foreign exchange reserves from a $2.2 billion Eurobond issuance. Analysts believe that sustained policy reforms and exchange rate stability will be essential for continued market growth in 2025. Market operators emphasized the importance of improving foreign investor confidence to ensure long-term growth.
SOURCE: THE SUN