Naira, Stocks, and Bonds Slip as Trump’s Threat Sparks Market Tension

Nigeria’s financial markets weakened on Monday following comments by United States President Donald Trump, who suggested possible military action against Nigeria over alleged attacks on Christians.

The remarks, posted on Trump’s Truth Social platform over the weekend, triggered fresh geopolitical anxiety, prompting declines across the foreign exchange, equities, and bond markets.

Data from the Central Bank of Nigeria showed that the naira fell to N1,436.34 per dollar at the official window, down from N1,421.73/$, while parallel market rates slipped to around N1,455/$. Analysts linked the depreciation to increased dollar demand and risk concerns among investors.

The Nigerian Exchange also closed lower, with the All-Share Index declining by 0.25% to 153,739.11 points, and market capitalisation down by about N246bn. Sell-offs in major stocks, including Aradel Holdings and Access Corporation, weighed on overall performance. Trading activity also slowed, with volume and value dropping sharply.

Across sectors, Oil and Gas, Banking, Insurance and Commodities posted losses, while Consumer Goods made a slight gain.

The pressure was also felt in Nigeria’s external debt market. According to trading data cited by Channels Television, dollar-denominated bonds maturing in 2051 slipped by roughly 0.5 cents before partially recovering. The movement was notable in a day where other emerging market bonds traded mostly stable.

However, analysts noted that the reaction remained contained. A strategist at Standard Chartered London told Reuters that the bond dip “partly reversed” later in the session.

Amid the market reaction, Nigeria’s government said it would welcome support from the U.S. against violent groups, provided the nation’s sovereignty and territorial integrity remain intact. Conflict-related killings attributed to insurgents, bandits and communal clashes claimed over 3,500 civilian lives last year, according to data from the Armed Conflict Location and Event Data Project.

Economists say the broader economic outlook still depends on policy stability and diplomatic clarity.
Tilewa Adebajo, CEO of CFG Advisory, described the market reaction as a “temporary shock,” citing Nigeria’s recent removal from the FATF Grey List as a positive signal for investors.

But Dr. Muda Yusuf of the Centre for the Promotion of Private Enterprise warned that public threats of military action could undermine investor confidence and heighten perception of political risk.

As the government prepares to respond diplomatically, investors will be watching for signals that restore calm and reassure markets already navigating inflationary and foreign exchange pressures.