NGX: Foreign investors’ participation slumps 26% to N183.61 billion in May, worst decline in 2026

Foreign investors’ transactions declined 25.90% month-on-month to N183.61 billion from N247.78 billion in April, even as overall market activity reached its highest monthly level of the year.

The portfolio investors accelerated their exit from the Nigerian equities market in May 2026, with their share of total transactions on the Nigerian Exchange (NGX) falling to just 9%, the lowest level recorded in 2026.

The figures are contained in the latest Domestic & Foreign Portfolio Investment Report released by NGX Regulation Limited, covering equities transactions as at May 31, 2026.

The data reveals total transactions rose 7.79% to N1.94 trillion — a 2026 peak — while the foreign investor footprint shrank to its smallest monthly share since the year began. Foreign outflows of N96.01 billion exceeded inflows of N87.60 billion, resulting in a net foreign outflow of N8.41 billion for the month.

What the data is saying:

The May 2026 report reveals a market increasingly driven by domestic capital, with foreign participation declining even as total activity grows.

Key highlights for May 2026:

• Total transactions: N1.94325 trillion, up 7.79% from N1.80290 trillion in April
• Domestic transactions: N1.75964 trillion, representing 90.55% of total activity
• Foreign transactions: N183.61 billion, representing 9.45% of total activity
• At N183.61 billion, foreign transactions are down -25.90% from April’s N247.78 billion
• Foreign inflow: N87.60 billion
• Foreign outflow: N96.01 billion
• Net foreign flow: Down to -N8.41 billion (net sellers)
• Domestic retail transactions: N726.27 billion, up 6.22% from N683.74 billion in April
• Domestic institutional transactions: N1.033 trillion, up 18.59% from N871.38 billion in April

In terms of year-on-year comparison, the total May 2026 transactions stood at N 1.94 trillion, about 177.42% higher than May 2025’s N700.50 billion

Highlight of 2026 year-to-date cumulative position as at May 31:

• Total transactions: N7.9 trillion vs N3.41457 trillion in 2025 YTD, up 131.3%
• Domestic transactions: N6.92 trillion, representing 87.67% of total
• Foreign transactions: N973.38 billion, representing 12.33% of total
• Foreign inflows YTD: N400.06 billion
• Foreign outflows YTD: N573.32 billion
• Cumulative net foreign outflow YTD: N173.26 billion

More insights:

A deeper look at the May data revealed that the foreign investor retreat is only one dimension of a more complex outlook of market activities during the month under review.

• Within the domestic segment, institutional investors have themselves turned net sellers while growing their participation.
• This has created a picture where the market’s headline growth in total transactions is being driven by volume rather than net accumulation.
• Institutional investors accounted for 59% of domestic participation in May, generating N1.03 trillion in gross activity.
• However, institutional outflows of N563.19 billion exceeded inflows of N470.18 billion, resulting in a net institutional outflow of N93.01 billion.

This is the primary driver of domestic selling pressure in the review period.

• Retail investors, by contrast, emerged as the market’s net buyers in May with inflows of N383.34 billion against outflows of N342.93 billion.
• Retail investors recorded a net inflow of N40.41 billion only.

Their 41% participation share, while smaller than that of institutions, provided crucial buying support that partially offset institutional selling.

• Total domestic net flow was negative at -N52.60 billion, confirming that even the domestic segment experienced net selling pressure in May.

Combined with the N8.41 billion net foreign outflow, the market recorded a total net outflow of N61.01 billion for the month.

Market development of particular concern:

The trajectory of foreign participation in 2026 suggests a sharp and steady three-month deterioration.

• Foreign transactions peaked at 16.56% of total activity in March 2026, declined to 13.74% in April, and have now fallen to 9.45% in May.
• Foreign participation has now fallen below the January 2026 level of 13.24%, suggesting that the factors driving the retreat — including T+1 settlement uncertainty, pre-election risk aversion, and global portfolio rebalancing — are intensifying rather than abating.
• On a year-to-date basis, foreign participation in 2026 stands at 12.33% of total transactions, a dramatic reduction from the 29.17% recorded in the same period of 2025.
• In naira terms, YTD foreign transactions of N973.38 billion are marginally below the N996.03 billion recorded in 2025 YTD despite total market transactions being 131% higher.

This means foreign investors are participating at a fraction of last year’s relative intensity even as the overall market has more than doubled in transaction value.

What you should know

The sharp drop in foreign participation to 9% in May coincided with the recent implementation of Nigeria’s T+1 settlement transition, which commenced on June 1, 2026.

• FTSE Russell has cited T + 1 as a trigger for pausing Nigeria’s planned return to Frontier Market status, a development likely to extend foreign investor caution in the near term.
• May 2026’s total transactions of N1.94 trillion represent the highest monthly activity level recorded on the NGX in 2026, driven entirely by domestic investors — both retail and institutional — even as the foreign share hit a 2026 low of 9.45%.
• The 2026 year-to-date total of N7.9 trillion is more than double the N3.41 trillion recorded in the same period of 2025, reflecting the transformative growth in domestic investor participation that has characterised the current market cycle.
• Cumulative net foreign outflows of N173.26 billion in 2026 YTD — reflecting N573.32 billion in outflows against N400.06 billion in inflows — confirm that international investors have been consistent net sellers of Nigerian equities across all five months of the year.

The institutional net selling of N93.01 billion in May suggests that large domestic portfolio managers — pension funds, asset managers, and insurance companies — began rebalancing portfolios toward fixed income instruments as T-bill yields climbed above 17% and OMO rates approached 22% during the month.

Retail investors’ net buying position of N40.41 billion in May reflects the resilience of individual investor participation even in a season of market correction, supported by the expanding base of digital trading platforms and growing financial literacy among younger Nigerian investors.