Perhaps in response to President Muhammadu Buhari declaring his intentions to run for a second term, Nigeria’s financial markets all reacted negatively.

The Nigerian Stock Exchange (NSE) All-Share Index closed at 40, 429.18 basis points, down 1.01%.  Year to date gains have since dropped to 5.72%.

Bashir Ahmad, Special Assistant to the President on New Media, broke the news on his twitter handle.

Possible Market reaction?

Nairametrics Founder, @Ugodre tweeted a snapshot of the market chart at the end of trading on Monday.

 

Yields rose marginally on long-dated bonds, while they dropped on treasury bills. Investors usually pile into bonds during times of uncertainty.

The down markets may not necessarily be a reflection of negative sentiments to the President’s candidature but the heightened uncertainty. The President’s declaration in some ways would be the unofficial start of the campaign period. Governance could also take a back seat.  The National Assembly is yet to pass the 2018 budget into law.

Approaching elections could also increase socio-political tensions in the Niger Delta which has been largely peaceful.

In the coming days

Investors should pay closer attention to the Investors and exporters window. Heavy traffic there could indicate foreign investors are taking their leave from the country.  This could precipitate pressure on the foreign exchange rate.

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via onome.ohwovoriole@nairametrics.com

2 COMMENTS

  1. This is one reason I hate Nairametrics, you guys just write useless headline or news. This is journalism at it’s worst. What is the meaning of “The market tanked because President Buhari announced his intentions to run for second term”. Was it the President that made Lafarge declare a horrible result where its preys declared fantastic results. What was your headline when the Nigerian stock market was celebrated earlier this year, I bet you won’t have given him credit.

    Abeg you guys can do better.

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