Close Menu
    Facebook X (Twitter) Instagram
    Facebook X (Twitter) Instagram
    SweetCrudeReportsSweetCrudeReports
    Subscribe
    • Home
    • Oil
    • Gas
    • Power
    • Solid Minerals
    • Labour
    • Financing
    • Freight
    • Community Development
    • E-Editions
    SweetCrudeReportsSweetCrudeReports
    Home » Nigeria: Foreign investment in equities falls to nine-year low

    Nigeria: Foreign investment in equities falls to nine-year low

    November 16, 2016
    Share
    Facebook Twitter LinkedIn WhatsApp

    NIGERIAN STOCK EXCHANGE 416 November 2016, Lagos – The foreign investment in Nigerian equities in the third quarter of 2016 fell to nine – year low as investors seek safety in less risky and high yielding fixed income securities.

    The capital importation data supplied by the Central Bank of Nigeria (CBN) and recently released by the National Bureau of Statistics (NBS) showed that foreign inflows into equities in Q3 fell by 28 per cent quarter to quarter (QoQ) for the first time in the capital market data series.

    Besides, it fell to nine year- low of 2007 level. Specifically, inflows into equities were $201.12 million in the Q3, compared to previous highs of $4.930billion in Q1 of 2013 and $3.875 billion in second quarter of 2014.

    While inflows into equities fell, the total capital imported into the country in Q3 rose from the level in Q2. According to NBS, the total value of capital imported into Nigeria in Q3 2016 was estimated to be $1.822 billion, which represented an increase of 74.84 per cent relative to the second quarter, and a fall of 33.70 per cent relative to the third quarter of 2015.

    “The highest level of capital imported was in August, when $894.00 million was imported, the highest level since July 2015. In September $649.76 million was imported, which was still more than any month in the first and second quarters. In contrast with the previous quarter, where Other Loans explained the majority of the increase, a number of investment types contributed to the quarterly increase,” the agency said.

    NBS explained that much of the quarterly increase in the value of capital importation came from debt financing, noting that of the total quarterly increase, 85 per cent was accounted for by increases in portfolio investment in bonds and money market Instruments.

    “The latter of which comprises short-term funding securities such as treasury bills and commercial bills from CBN. Quarterly growth in foreign direct investment (FDI) equity was also strong, although portfolio equity continued to decline. FDI investments have a longer-term interest, and are therefore less likely to reflect short term challenges than portfolio equity.

    “Nevertheless, each type of investment (FDI, portfolio and other) recorded quarterly increases, of 84.84 per cent, 172.84 per cent and 7.80 per cent respectively. The relatively strong growth in portfolio Investment meant it regained its position as the largest investment type, and it accounted for 50.51 per cent in the third quarter, compared to 18.69 per cent and 30.80 per cent for Other Investment and FDI respectively. Year on year growth rates remained negative; FDI, portfolio and Other Investment declined by 52.54 per cent, 8.80 per cent and 45.05 per cent respectively compared to the third quarter of 2015,”  NBS said.

    Commenting on the development, analysts at Afrinvest West Africa, an investment banking firm, said: “Notwithstanding expected drag in equities portfolio inflow in the short term, we expect capital importation to continue to show improvement on Q-o-Q basis, buoyed by loans (particular the recently approved $600 million AFDB budget support facility and planned Eurobond issuance for Q4:2016) and fixed income investments inflow. However, medium term drivers of capital importation include FX market liquidity development, monetary policy outlook and FGN negotiation for multilateral credit facilities.

    • This Day

    Related News

    West African development bank expects regional growth to edge lower

    Nigeria champions sustainable financing at AU Executive Council meeting

    AFRICA-FX-Nigerian and Ghanaian currencies among those seen stable

    E-book
    Resilience Exhibition

    Latest News

    Court dismisses N5.74bn Macobarb’s suit against NLNG

    July 16, 2025

    Collaboration is key to unlocking Nigeria’s marginal field potential

    July 16, 2025

    ANPG President to outline Angola’s $60bn investment strategy at AOG 2025

    July 16, 2025

    West African development bank expects regional growth to edge lower

    July 16, 2025

    Oil prices steady as investors weigh trade war impact

    July 16, 2025
    Demo
    Facebook X (Twitter) Instagram
    • Opec Daily Basket
    • Oil
    • Power
    • Gas
    • Freight
    • Financing
    • Labour
    • Technology
    • Solid Mineral
    • Conferences/Seminars
    • Community Development
    • Nigerian Content Initiative
    • Niger-Delta Question
    • Insurance
    • Other News
    • Focus
    • Feedback
    • Hanging Out With Markson

    Subscribe for Updates

    Get the latest energy news from Sweetcrudereports.

    Please wait...
    Please enter all required fields Click to hide
    Correct invalid entries Click to hide
    © 2025 Sweetcrudereports.
    • About Us
    • Advertise with us
    • Privacy Policy

    Type above and press Enter to search. Press Esc to cancel.