Nigeria’s Stock Market Slumps as Trump’s Military Threat Rattles Investors; Eurobonds Hold Steady

Nigeria’s stock market continued its downward spiral on Tuesday as investors reacted sharply to U.S. President Donald Trump’s threat of possible military action against the country over alleged human rights violations. The Nigerian Exchange (NGX) recorded another round of losses after equities investors shed about ₦244.9 billion on Monday, deepening market pessimism across major sectors.

The All-Share Index dropped by 0.72% to close at 152,629.60 points, while market capitalization contracted by ₦611.97 billion to ₦96.97 trillion, reflecting persistent sell pressure. Analysts attributed the decline to weak third-quarter earnings, poor investor sentiment, and uncertainty triggered by Trump’s remarks. The market breadth remained negative with 40 decliners outweighing 17 gainers, as key sectors — including banking, oil and gas, and consumer goods — all recorded losses.

Meanwhile, Nigeria’s Eurobonds, which had fallen sharply on Monday amid global investor unease, began to stabilize by Tuesday. Bloomberg data showed that bonds maturing in 2047 were among the hardest hit but later pared their losses as the government pressed ahead with plans to issue a new $2.3 billion bond sale. Analysts believe the initial selloff was a knee-jerk reaction to Trump’s statement, with investors now adopting a wait-and-see approach.

In the currency market, the naira rebounded after slipping earlier in the week, trading around ₦1,434 per dollar at the official market, according to Central Bank of Nigeria (CBN) data. The temporary depreciation reflected investor anxiety but quickly adjusted as market confidence steadied. However, economists warn that prolonged political tension with the U.S. could fuel volatility in the FX market and weaken foreign investment inflows.

Experts say Trump’s threat, though largely rhetorical, could have far-reaching implications for Nigeria’s economy and investor confidence. Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise (CPPE), cautioned that such statements from a U.S. President carry “significant reputational risks” and could deter foreign capital. He urged the Nigerian government to adopt proactive diplomacy to de-escalate tensions, rebuild investor trust, and reaffirm Nigeria’s stability as a viable investment destination.

source: Dailytrust