In a development that reflects Nigeria’s growing economic activity and maturing financial markets, the total value of foreign and domestic transactions surged by 3.23 trillion in 2024, marking a 51.92 percent year-on-year increase. Data from the Nigerian Exchange Limited (NGX) showed that by the end of November, transactions reached 4.91 trillion, surpassing the 3.23 trillion recorded in the same period in 2023 and setting a historic high above the previous record of 3.97 trillion in 2007.

The remarkable growth was largely driven by increased investor interest in Nigerian equities, which have shown resilience amid tightened monetary policies. The Central Bank of Nigeria (CBN) raised interest rates by over 800 basis points in 2024, a move that, despite presenting challenges, did not deter investor confidence in the equities market.

Domestic investors have continued to dominate the market, accounting for over 84 percent of total transactions, equivalent to 4.13 trillion. Foreign investors contributed 785.3 billion, representing 16 percent of the total. This trend highlights the steadfast participation of local investors, even as foreign inflows remain subdued. Since the pandemic, foreign participation has consistently stayed below 25 percent, influenced by factors like market risks and the CBN’s capital control measures.

In November 2024 alone, the local bourse recorded 442.3 billion in transactions. Domestic investors led with 401.4 billion, while foreign investors contributed 40.94 billion. Although this represents a 12.01 percent decline from October’s 502.7 billion, it marks a robust 47.12 percent year-on-year growth from 300.7 billion in November 2023.

Institutional investors slightly edged out retail participants, accounting for 2 percent more of the total transactions in November. Retail investor activity, however, rose significantly by 14.90 percent, with transactions increasing from 170.04 billion in October to 195.38 billion in November. Conversely, institutional transactions declined by 27.77 percent, falling from 285.23 billion in October to 206.02 billion.

A month-on-month comparison reveals a cooling off as the year-end approaches. Domestic transactions dropped by 11.83 percent from October’s 455.27 billion to 401.40 billion in November, while foreign transactions fell by 13.74 percent from 47.46 billion to 40.94 billion. Despite these declines, local investors’ continued confidence underscores the strength of the Nigerian equities market.

Looking ahead, market analysts express cautious optimism for 2025. While Nigerian equities are expected to sustain strong investor sentiment, competition from fixed-income and money markets, which offer attractive yields, could moderate growth. The interplay between these asset classes will likely shape the investment landscape.

Nevertheless, the NGX remains well-positioned to attract sustained interest from a diverse group of investors. With a favorable economic outlook and strong fundamentals, the Nigerian financial market is poised for continued growth in the coming year.

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