Yields on Nigeria’s U.S. dollar-denominated bonds increased to 9.70% as bearish market sentiment pushed yields higher, despite mixed results in the international capital markets influenced by the U.S. election.
Market sentiment has shifted from previous trends, according to fixed-income traders, who reported a mixed outlook across the short-, mid-, and long-term ends of Nigeria’s yield curve. This shift resulted in lower trading activity in Nigeria’s sovereign Eurobonds.
The U.S. elections had a notable impact on the market, which closed on a bearish note as trading volumes remained low while investors turned their attention to the polls. TrustBanc Capital Limited noted that offers were prominent across the curve, particularly on the mid- and long-term bonds, except for the 2025 and 2047 maturities, which saw mild buying interest.
The bearish trend extended across the Sub-Saharan Africa (SSA) curve, affecting bonds from Ghana, Angola, and Egypt. Traders expect cautious trading to persist as investors await early signals from the tightly contested U.S. election, which could further influence market dynamics and investor confidence.
Within African bond markets, only a few Nigerian corporate bonds saw slight demand, while sovereign bonds from Nigeria, Angola, and Egypt experienced price declines. The average mid-yield for Nigerian bonds rose by 10 basis points, closing at 9.70%.
In the foreign exchange market, the naira appreciated by 0.33%, ending the day at ₦1,671.32 per dollar in the official market, while closing at ₦1,710 per dollar in the parallel market.
