Retail capital market transactions edge to 33.1 per cent

Retail transactions on the Nigerian Exchange Limited (NGX) surged by 33.10% in January 2025, climbing from N200.9 billion in December to N267.4 billion.

In contrast, institutional investors dip, dropping from N406 billion to N268.2 billion over the same period.

The December 2025 edition of the NGX Domestic and Foreign Portfolio Investment Report indicated that while retail transactions rose by 33 per cent, the institutional composition of the domestic market decreased by 33.95 per cent.

Analysts attributed the unprecedented surge in retail transactions to increased investors’ participation, market volatility, inflation hedging, government policies and speculation.

According to them, more individuals, especially younger investors, are entering the market due to easy access to trading apps and social media influence.

Market fluctuations also create opportunities, while low returns from fixed-income investments push people toward equities.

Inflation concerns drive investors to stocks and other assets to protect their wealth while government policies, tax incentives and lower transaction costs also encouraged more retail activity.

On the other hand, market volatility and broader economic uncertainty contributed to institutional investors’ retreat from equities.

Currency fluctuations and policy changes have introduced unpredictability, increasing risk aversion among large-scale investors.

As a result, many institutional players opted to reduce their exposure to stocks in favour of more stable investment options, leading to a notable decline in their participation.

Further breakdown of the data showed that the total value of transactions executed by domestic investors outperformed transactions executed by foreigners by 76 per cent within the period.

Domestic transactions also accounted for about 85 per cent of the total transactions carried out in 2024, whilst foreign transactions constituted about 15 per cent of the total transactions in the same period.

The transaction data for 2025 indicated that total domestic transactions are worth N535.54 billion, whilst total foreign transactions are N71.51 billion.

As at January 31, 2025, total transactions at the country’s bourse decreased by 9.9 per cent from N673.7 billion (about $438.64 million) in December 2024 to N607.05 billion (about $410.84 million) in January 2025.

The performance of the current month (December) when compared to the performance in January 2024 (N651.5 billion) revealed that total transactions decreased by 6.83 per cent.

Over 18-year period, domestic transactions increased by 33.15 per cent from N3.6 trillion in 2007 to N4.7 trillion in 2024, while foreign transactions also increased by 38.3 per cent from N616 billion to N852 billion over the same period.

Meanwhile, the Nigerian equities market reopened the week on a bearish note as the overall capitalisation declined by N231 billion amid losses in Northern Nigeria Flour Mills (NNFM) Plc and 36 stocks.

Yesterday, the All-Share Index (ASI) declined by 370.43 points, representing a loss of 0.34 per cent to close at 108,126.97 points.

Also, market capitalisation lost N231 billion to close at N67.383 trillion.

The downturn was driven by price depreciation in large and medium-capitalized stocks amongst which are; NNFM, Transnational Corporation (Transcorp), Oando, FBN Holdings (FBNH) and Eunisell Interlinked.

On what will shape the market in the next trading session, analysts at Vetiva Dealings and Brokerage said: “The market is expected to trade cautiously in the next session following today’s broad-based decline.

“Profit-taking in the banking and oil & gas sectors could sustain pressure, however, pockets of bargain hunting in consumer goods stocks may provide support; investors may maintain a wait-and-see approach, balancing profit-taking with selective buying.”

Afrinvest Limited said: “Barring the emergence of market stimulating shocks, we expect the negative sentiment to persist due to depressed investor sentiment.”

The market breadth, which measures investor sentiment close in negative, as 17 stocks appreciated, while 37 stocks depreciated. Ikeja Hotel emerged as the highest price gainer of 10 per cent to close at N12.10 kobo. PZ Cussons Nigeria followed with a gain of 9.26 per cent to close at N29.50 kobo while Consolidated Hallmark Holdings was up by 8.85 per cent to close at N4.18 kobo.

DAAR Communications rose by 8.82 per cent to close at 74 kobo, while Livestock Feeds appreciated by 5.95 per cent to close at N6.41 kobo.

On the other side, NNFM led others on the losers’ chart with 9.99 per cent to close at N72.55 kobo. Eunisell Interlinked followed with a decline of 9.96 per cent to close at N10.85 kobo, while Sovereign Trust Insurance shed 9.09 per cent to close at N1.20 kobo.

Secure Electronic Technology went down by 7.46 per cent to close at 62 kobo, while UPDC depreciated by 6.13 per cent to close at N2.91 kobo.

However, the total volume of trade improved by 13.3 per cent to 357.759 million units, valued at N9.211 billion, and exchanged in 15,914 deals. Transactions in the shares of Jaiz Bank led the activity with 48.188 million shares worth N161.638 million. Zenith Bank followed with an account of 28.192 million shares valued at N1.373 billion, while Universal Insurance traded 18.683 million shares valued at N12.670 million.

Guaranty Trust Holding Company (GTCO) traded 17.877 million shares worth N1.126 billion, while Access Holdings traded 15.515 million shares worth N403.585 million.