Nigeria stocks dip; Eurobonds remain stable amidst Trump’s threat
The Nigeria Stock Market sustained the bearish sentiment on Tuesday as markets continue to react to the recent threat of military action against Nigeria by US President Donald Trump over alleged genocide against Christians. Equities investors had earlier on Monday recorded about N244.9billion loss at the close of trading on the floor of the Nigerian […]
The Nigeria Stock Market sustained the bearish sentiment on Tuesday as markets continue to react to the recent threat of military action against Nigeria by US President Donald Trump over alleged genocide against Christians.
Equities investors had earlier on Monday recorded about N244.9billion loss at the close of trading on the floor of the Nigerian Exchange (NGX) in response to Trump’s threat.
At the same time, Nigeria’s Eurobonds also known as dollar bonds also fell marginally across the maturity curve. However, the Eurobonds are stabilising even as Nigeria plans to sell another $2.3bn bond, according to a report.
NGX losses deepen
The Nigerian Exchange (NGX) losses deepened as selling pressures persisted into the second trading session in the new week.
The local bourse has continued to bleed due to negative investors’ sentiment across sectoral indices in the midst of third quarter earnings releases.
Banking names’ unimpressive earnings performance took away the stock market’s usual flavour that attracts significant bargain hunting.
Instead, the local bourse has been moving negatively, with the year-to-date return down to 48.29% due to losses in oil and gas, financial and consumer stocks, among others.
Data from the Nigerian Exchange showed that All-Share Index fell by 0.72% to close at 152,629.60 points. Hence, NGX market capitalisation contracted by N611.97 billion to N96.97 trillion.
Stockbrokers said market sentiment remained distinctly bearish, with 40 losers significantly outpacing 17 gainers, yielding a subdued 0.4x breadth ratio.
Trading activity presented mixed signals as volume increased 8.99% to 683.92 million shares, yet transaction values dropped 18.50% to N20.38 billion.
Also deal count contracted 8.61% to 33,288, reflecting diminished high-value institutional transactions and subdued retail engagement amid ongoing portfolio rebalancing and risk aversion.
EUNISELL, SUNUASSUR, HONYFLOUR, LIVESTOCK, and TIP registered gains, while NASCON, SKYAVN, OANDO, UPDC, and LEARNAFRICA led the decliners with substantial price erosion.
Broad-based sectoral weakness persisted: Insurance (-3.76%), Banking (-2.05%), Consumer Goods (-1.49%), Oil & Gas (-0.78%), and Industrial (-0.01%) sectors experienced capital depreciation, while the Commodity sector remained unchanged.
Eurobonds stable after Monday’s losses
After Nigerian dollar bonds fell across the maturity curve, comprising all 10 of the worst performers in emerging markets worldwide as of 10:45 a.m. in Lagos on Monday, according to data compiled by Bloomberg.
The notes maturing in 2047 were down most, falling as much as 0.6 cents on the dollar to 88.26 cents before paring the decline.
Reports say Nigerian bonds are expected to recover after an initial drop triggered by Trump’s remarks over the weekend.
This is even as Nigeria is planning to sell $2.3 billion in eurobonds as soon as this week, testing investor appetite for the debt days after US President Donald Trump threatened military action, according to a Bloomberg report.
The government is moving ahead with plans to sell 10-year debt as well as 15- or 30-year securities, pending sign-off on the legal documents from the justice ministry, according to people with knowledge of the matter spoken to by Bloomberg.
Naira rebounds
Earlier on Monday, the Naira recorded massive depreciation against the United States dollar at the official foreign exchange market to begin the week on a negative note amidst the Trump threat.
The Central Bank of Nigeria’s data showed that the Naira weakened on Monday to N1,436.34 against the dollar, down from N 1,421.73 which was traded on Friday but on Tuesday the currency appreciated after an intraday depreciation.
According to CBN data, the naira exchanged between 1,433 to 1,441 to a dollar before settling at N1,434 to a dollar.
Experts speak on impact of US threat
Muhammed Muttaka Usman, a Professor of Economics, speaking on the impact of the US threat stated that the threat has an impact on Nigeria’s economic stability.
According to him, Nigeria remains a vital economic partner for Nigeria and bilateral trade in goods and services reached approximately $13 billion in 2024, according to official data from the Office of the U.S. Trade Representative.
He said, “Trump’s threat to cut “aid and assistance” could therefore ripple through multiple channels such as trade finance, energy exports, defense procurement and humanitarian programs. More risky still would be a suspension of Nigeria’s eligibility under the African Growth and Opportunity Act (AGOA), which offers duty-free access to US markets for African goods.
“Such a move could cripple Nigeria’s drive towards expanding non-oil exports, particularly in textiles, agro-processing, and light manufacturing. The country’s export council recently reported a nearly 20% rise in shipments during the first half of 2025, driven by global demand for cocoa, urea, and cashew.
“If Western importers begin to hesitate or reroute orders, these fragile gains could diminish. Higher insurance premia and costlier trade credit would also make Nigerian goods less competitive, even before a single sanction is imposed.”
On his part, Dr. Muda Yusuf, Director/Chief Executive Officer, Centre for the Promotion of Private Enterprise [CPPE] stated that the recent threat of possible military action against Nigeria by the President of the United States, President Donald Trump, “carries far-reaching implications for the Nigerian economy and investor confidence.”
“Although the statement appears to have been made on the basis of incomplete intelligence and misjudged assumptions, its source — the President of the United States — magnifies its potential impact.
“Regardless of its inaccuracy, the pronouncement has already generated economic, diplomatic, and perceptional consequences for Nigeria. The statement risks undermining the country’s image as a stable investment destination, unsettling financial markets, and eroding confidence among both domestic and international investors,” he stated.
According to him, the mere threat of military action by a global superpower has inflicted significant reputational damage on Nigeria’s image as a safe and viable investment destination.
He stated that such rhetoric can trigger declines in foreign direct investment (FDI) inflows; capital flight from portfolio and equity investors; a decline in venture capital and startup funding and heightened country risk ratings and investor anxiety.
Intense market volatility
Yusuf identified risk of falling stock market valuations, rising country risk premiums and insurance costs, higher sovereign bond yields and naira depreciation due to capital outflows and portfolio reversals.
Based on the risks highlighted above, he projected that Nigeria may experience rising interest rates; weakened currency and higher inflationary pressures; reduced foreign reserves and lower external buffers; pressure on fiscal balances from increased defense spending and lower investment inflows.
“An escalation in perceived geopolitical risk could tighten financial conditions and distort macroeconomic indicators,” he stated.
He said, “Uncertainty and fear would lead investors to adopt a wait-and-see posture, delaying or cancelling major projects. Private equity and venture funds may diversify away from Nigeria toward peer economies in Africa or Asia with lower perceived political risk.”
To mitigate the economic and perceptional risks, he stated that Nigeria must adopt a strategic and proactive diplomatic response.
Key policy measures should include high-level diplomatic engagement, immediate bilateral discussions with the U.S. government to clarify facts and de-escalate rhetoric, collaborative Security Partnership and deepening cooperation with U.S. and regional partners on intelligence, counterterrorism, and peacebuilding.
He said, “The U.S. President’s threat of military intervention in Nigeria is unwarranted, counterproductive, and economically destabilizing. It is a disproportionate response that fails to reflect the complexity of Nigeria’s internal security dynamics.
“Such statements send unsettling signals to investors, heighten risk perception, and undermine confidence in Nigeria’s economy. While Nigeria must continue to strengthen internal security architecture and governance, any external engagement should be cooperative — not coercive.
“Unilateral military action would destabilize Nigeria’s economy, threaten regional stability, and aggravate humanitarian conditions. The constructive path forward lies in diplomacy, partnership, and shared commitment to peace, development, and mutual respect for sovereignty.”