Foreign portfolio participation on the Nigerian stock market recorded a strong recovery in March 2026, as total foreign transactions on the Nigerian Exchange Limited surged by 107.74 per cent to N288.82bn.
According to the latest Domestic and Foreign Portfolio Investment report released by NGX Regulation Limited on Wednesday, total market transactions rose by 13.10 per cent to N1.744tn in March, up from N1.542tn recorded in February.
The report attributed the sharp increase in foreign participation to a surge in capital inflows, which climbed from N72.32bn in February to N181.77bn in March.
“The significant jump in foreign inflows suggests that international investors are increasingly finding value in Nigerian equities following recent market re-ratings and improved foreign exchange liquidity,” the report stated.
Despite the renewed foreign interest, domestic investors maintained a dominant presence on the exchange. Local investors accounted for 83.44 per cent of total market transactions, with domestic trades reaching N1.455tn during the month.
Institutional investors led domestic participation, outperforming retail investors by 26 per cent. Institutional transactions rose to N914.23bn, reflecting sustained confidence among pension funds and asset managers in high-quality Nigerian equities.
“The domestic market remains the bedrock of our exchange. With institutional transactions rising to N914.23bn, it is clear that local pension funds and asset managers are maintaining a strong bullish stance on high-quality Nigerian equities, even as foreign interest returns,” the report added.
The surge in foreign inflows comes at a time when the government and regulators are implementing fiscal and monetary reforms aimed at stabilising the naira and attracting more international capital.
Historically, foreign participation in Nigeria’s capital market has been constrained by currency volatility and difficulties in repatriating funds. However, the latest growth signals improving investor sentiment, partly supported by enhanced transparency in the Nigerian Autonomous Foreign Exchange Market.
Year-to-date figures also show strong market activity. Total transactions for the first quarter of 2026 reached N4.148tn, representing an 85.87 per cent increase compared to N2.232tn recorded during the same period in 2025.
The growth aligns with the broader rally in the Nigerian equities market, which has seen the NGX All-Share Index reach record highs over the past year.
Looking at long-term trends, the report noted that domestic transactions have grown significantly over the last 19 years, rising by 160.83 per cent. While foreign participation has fluctuated over time, the overall trajectory remains positive.
As the second quarter begins, analysts expect institutional investors to maintain their leading role in the market. However, foreign participation is likely to remain sensitive to macroeconomic indicators, especially inflation data and interest rate decisions by the Central Bank of Nigeria.
