Abstract：In February, Nigeria's stock market trading volume dropped by 97.58 billion naira, with foreign investors pulling back. Can domestic investors sustain the market?
In February 2025, total stock trading volume on the Nigerian Exchange fell to 5,094.7 billion naira, marking a 16.07% decline from January, a drop of 97.58 billion naira.
The decrease was mainly driven by lower market activity, particularly a sharp fluctuation in foreign investments. However, compared to the same period in 2024, trading volume still saw a 42.36% increase, indicating a positive long-term trend.
The key factor behind the fluctuations is the changing behavior of both domestic and foreign investors. While domestic trading fell by 12.83% in February, it remained the dominant force in the market.
Meanwhile, foreign investor participation plummeted by 40.36%, reflecting caution amid market uncertainties. Additionally, retail investors showed reduced activity, while institutional investors maintained a relatively stable influence.
Challenges Ahead for the Market
Looking ahead, uncertainties remain, particularly regarding the long-term impact of foreign capital outflows. Macroeconomic conditions, inflationary pressures, and currency fluctuations could continue to affect market performance.
However, the steady participation of domestic institutional investors may help stabilize the market. Investors should closely monitor market trends and adjust their strategies accordingly to navigate potential risks and opportunities.
