Domestic Investors Drive N6.96tn NGX Equity Transactions

Nigeria’s domestic investors remained the dominant force in the equities market in the first half of 2026, accounting for nearly 88 per cent of all transactions on the Nigerian Exchange (NGX), despite a gradual rebound in foreign portfolio participation.

The latest Domestic and Foreign Portfolio Investment (FPI) Report released by the Nigerian Exchange Limited (NGX) showed that total equity transactions on the Exchange reached N6.96tn between January and June 2026.

Of this amount, domestic investors accounted for N6.12tn, representing 87.93 per cent of total market activity, while foreign investors contributed N840.84bn, equivalent to 12.07 per cent.

The figures underscore the continued resilience of local institutional and retail investors, whose sustained participation has helped support market liquidity and absorb increased equity supply amid evolving macroeconomic conditions.

The report also indicated that total equity transactions in June rose sharply by 20.6 per cent month-on-month to N1.42tn, compared with ₦1.17tn recorded in May, reflecting stronger trading momentum at the close of the second quarter.

A breakdown of June transactions showed that domestic investors executed trades worth N1.262tn, accounting for 89 per cent of total market turnover, while foreign investors recorded transactions valued at N153.39bn, representing 11 per cent of market activity.

Although domestic transactions declined by 13.2 per cent from N1.45tn in May to N1.26tn in June, foreign participation strengthened significantly.

Foreign transactions increased by 17.7 per cent from N130.37bn in May to N153.39bn in June, suggesting renewed interest by offshore investors following improvements in Nigeria’s macroeconomic environment and foreign exchange market reforms.

Within the domestic segment, institutional investors continued to account for the larger share of trading activity.

Institutional transactions stood at N990.44bn in June, representing about 65 per cent of domestic trades, while retail investors contributed N527.34bn, or 35 per cent.

However, both investor categories recorded lower trading volumes compared with May.

Retail transactions declined by 26.7 per cent from N720.73bn, while institutional activity eased by 3.8 per cent from N1.033tn during the review period.

The report further showed that institutional investors recorded N507.24bn in sales against N487.25bn in purchases during June, while retail investors posted N273.34bn in purchases and N258.97bn in sales.

A longer-term review of market activity highlights the growing importance of domestic investors in Nigeria’s capital market.

Between 2007 and 2025, domestic equity transactions increased by 160.8 per cent from N3.56tn to N9.28tn , while foreign transactions rose by 329.9 per cent from N616.5bn to N2.65tn over the same period.

Despite the stronger long-term growth in foreign participation, domestic investors have consistently remained the backbone of the Nigerian equity market.

In 2025, domestic transactions accounted for approximately 78 per cent of total market turnover, while foreign investors contributed about 22 per cent.

Market analysts believe the continued dominance of domestic investors reflects increasing confidence among local institutional investors, particularly pension fund administrators, asset managers and insurance firms, whose growing allocations to listed equities have provided stability to the market amid periods of global uncertainty.

They also noted that the gradual recovery in foreign participation during the first half of the year could strengthen market liquidity further if Nigeria sustains macroeconomic reforms, exchange rate stability, easing inflationary pressures and improved foreign exchange liquidity.

With domestic investors continuing to anchor trading activity and foreign portfolio flows showing signs of recovery, analysts expect the NGX to maintain healthy market liquidity and investor participation in the second half of 2026, supported by improving corporate earnings, ongoing economic reforms and a more stable investment environment.