The Nigerian markets reeled after a dramatic international development. The Donald Trump administration named Nigeria a “Country of Particular Concern” over alleged widespread killings of Christians and rising religious intolerance, and warned of possible military action if the government fails to act. The impact was swift: the market capitalisation of the Nigerian Exchange Limited (NGX) slid from N97.829 trillion to N97.583 trillion, marking a drop of N246 billion (0.25 per cent).
At the close of trade, the NGX All-Share Index stood at 153,739.11 basis points, down 387.35 points from last week’s 154,126.46. Meanwhile, Nigeria’s dollar-denominated bonds were also hit: bonds maturing in 2047 fell to 88.26 cents on the dollar as investor confidence took a blow.
However, analysts were quick to push back against fears of deeper damage. Profit-taking in major stocks rather than fundamental collapse was cited as the main culprit. As one managing director in the capital-markets space put it: “We cannot conclude that investors reacted to President Trump’s threats. Possibly what is going to happen is uncertain.”
A fixed-income trader summed it up as follows:
“Yes, there were selloffs, but they created good entry points for investors who understand the market. The initial panic was more of a knee-jerk reaction than a reflection of Nigeria’s true risk profile.”
Experts also emphasised the long-standing strategic ties between Nigeria and the United States in oil, gas and investment sectors, suggesting diplomatic channels will ultimately prevail over brinkmanship.
