In April 2025, Nigeria’s equities market faced a stark reality check as foreign portfolio investment (FPI) cratered by 92.39%, plunging to N26.64 billion from N349.97 billion in March. The dramatic drop, detailed in data from the Nigerian Exchange (NGX), was driven by the absence of the block trades that had fueled March’s surge, compounded by global uncertainties that chilled international investor appetite. Total foreign transactions mirrored this decline, collapsing 90.99% to N63.07 billion, with outflows of N36.43 billion outpacing inflows, resulting in a net capital outflow of N9.79 billion.
The sharp reversal from March, when foreign trades accounted for 62.74% of market activity, was jarring. In April, foreign participation dwindled to just 13.08%, as investors grappled with geopolitical headwinds, notably U.S. President Donald Trump’s announcement of sweeping tariffs, including a 14% levy on Nigerian exports. This policy, part of a broader 10% baseline tariff on imports from over 75 countries until July 8, 2025, disrupted trade flows and amplified economic uncertainty, further dampening sentiment toward Nigerian equities.
Overall market activity also took a hit, with total transaction value on the NGX dropping 56.79% to N482.04 billion from N1.115 trillion in March. Yet, a year-on-year comparison offers some solace: April 2025’s figure reflects a 39.22% increase from N346.23 billion in April 2024. Year-to-date (YTD), total trades reached N2.714 trillion, up 43.3% from N1.894 trillion in 2024, hinting at improved liquidity earlier in the year. Still, April’s decline underscores persistent vulnerabilities in a market sensitive to global shocks.
Domestic investors, as ever, propped up the market, contributing N418.97 billion or 86.92% of April’s trades, a slight uptick from March’s N415.62 billion. Institutional investors led the charge, boosting activity by 8.77% to N237.66 billion, driven by pension funds and asset managers. Retail investors, however, pulled back, with trades falling 8.02% to N181.31 billion, reflecting caution among individuals. YTD, institutional trades (N976.66 billion) outpaced retail (N860.29 billion) by 14%, cementing their dominance.
Despite March’s foreign inflow spike, YTD foreign flows remain negative, with N420.32 billion in inflows overshadowed by N456.80 billion in outflows, yielding a net outflow of N36.48 billion. Domestic investors accounted for 67.68% of YTD activity, while foreign trades comprised 32.32%, a shift from 2024’s 13.77% foreign share. Historically, domestic trades have grown 33.15% from N3.556 trillion in 2007 to N4.735 trillion in 2024, with foreign transactions up 38.31% to N852 billion, underscoring Nigeria’s reliance on local capital.
The Central Bank of Nigeria’s $200 million forex injection aimed to stabilize the naira amid tariff-induced volatility, but deeper reforms are needed to restore foreign confidence. As global financial conditions tighten, Nigeria’s equities market leans heavily on domestic institutions, navigating a turbulent 2025 with resilience but little room for complacency.
