The bullish trend being recorded at the Nigerian stock market has contributed to an increase in flow of foreign exchange in the country as capital inflow of the county rose by 95.02 per cent in the second quarter of 2017.
Between April and June this year, the value of capital imported into the country rose to $1.792 billion which is $884.1 million above what came into the county in the first three months of the year.
The rise in capital inflow was due to increased foreign portfolio investments which largely went into the equities market.
According to the Nigerian Capital Importation data released by the National Bureau of Statistics (NBS), the funds inflow of the second quarter of 2017 was an improvement of 43.6 per cent from the $1.042 billion recorded in the second quarter of 2016.
Portfolio investments, which was the major driver of the increased inflow swelled by 145.7 per cent, followed by Other Investments, which grew by 95.02 per cent, and then Foreign Direct Investment (FDI), which increased by 29.8 per cent over the previous quarter.
Accounting for 43 per cent of the total inflow, portfolio investments in the second quarter was estimated at $770.51 million.
Analysis showed that equities got the largest share of 79.7 per cent or $$614.05 million followed by money market instruments which accounted for 12.8 per cent or $98.6 million while bonds accounted for 7.5 per cent or $57.9 million.
Other investments which took the second largest share of the total inflow of 41.7 per cent got $747.5 million while foreign direct investments accounted for 15.3 per cent or $274.4 million of the total inflow.
Equity investments accounted for the majority of the FDI imported into the country in the second quarter of the year, taking up 99.9 per cent of total FDI and increasing by 30.5 per cent over the last quarter.
Being the commercial capital of the country and the seat of the Nigerian Stock Exchange, Lagos State remained the toast of investors taking up the largest chunk of the capital inflow.
In the second quarter of the year, Lagos State accounted for 97.07 per cent or $1.739 billion of capital importation.
It was followed by Akwa Ibom which took 1.92 per cent or $34.08 million of the total share an increase of 85 per cent over the amount it recorded in the previous quarter, while Abuja had $16.64 million representing 0.93 per cent of the total share.
The largest inflow into the country came from the United Kingdom which accounted for $696.7 million or 38.87 per cent of the total.
This value represents a 130.3 per cent increase compared to the previous quarter.
The UK has accounted for the highest value of capital importation since 2010 except in the second half of 2015.
A month on month analysis of capital importation in the second quarter shows that the month of May recorded the highest of amount of capital importation ($616.5 million), followed by June with $612.6million and May with $563.3 million.
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