Foreign Investors Sell Off ₦576 Billion in Nigerian Stocks Amid Market Volatility in H1 2025

Foreign investors sold off Nigerian stocks worth ₦576.09 billion in the first half of 2025, marking an 84.97% increase compared to the ₦311.41 billion withdrawn in the same period of 2024.

This significant sell-off was accompanied by foreign inflows of ₦559.25 billion resulting in a slight net foreign portfolio investment deficit of ₦16.84 billion over the six months.

The Nigerian Exchange Group’s (NGX) report for June 2025 revealed that total foreign-related transactions surged to ₦1.14 trillion in the first half of the year more than doubling the ₦540.48 billion recorded in the first half of 2024.

Analysts attribute the rise in foreign outflows to global market volatility and the attractiveness of higher-yielding fixed-income assets such as treasury bills.

Despite the increased foreign activity, domestic investors remained dominant, accounting for approximately 73% of the total market activity by value with institutional investors leading trading volumes. While foreign investors showed apparent caution toward Nigerian equities they remained active in the broader portfolio, especially in fixed income.

Experts note that many foreign portfolio investors (FPIs) operate with short-term strategies making quick exits when profit targets are met often influenced by global economic policies and domestic currency fluctuations.

The appreciation of the naira against the dollar in recent months helped slightly improve foreign investor sentiment.

Overall market activity increased by 61% year-on-year, with total turnover hitting ₦4.19 trillion in H1 2025 reflecting both growing interest and volatility in Nigeria’s capital markets.

However concerns remain regarding the quality and stability of these capital flows particularly given the rising foreign sell-offs and changes in domestic retail investor participation.

This trend highlights the challenges Nigeria faces in attracting and retaining long-term foreign investment in its stock market amid a complex global economic environment and domestic policy uncertainties.

The Nigerian Exchange Group and market analysts continue to monitor investor behavior closely, emphasizing the need for policies that promote market stability and investor confidence.