Yield Climbs as Bears Touch Nigeria’s Eurobonds
Nigeria’s Eurobond yield rose to 9.51% due to a bearish touch from sell-side foreign portfolio investors in the international market at the time when DeepSeek performance rattled the Artificial Intelligence (AI) industry and WallStreet expectations.
Reacting to DeepSeek’s strategic positioning, major tech company stocks fell sharply on the day as the Chinese AI heightened popular AI’s valuation risks. Bearish sentiment across Nigeria’s sovereign Eurobonds market, encompassing the short, mid, and long ends of the yield curve, led to a 9-basis-point increase in the average yield, settling at 9.51%, according to Cowry Asset Limited.
Elevated yields on Nigeria’s US dollar bond have kept offshore investors and some local investors who have a penchant for foreign currency-denominated assets glued to the market.
The Eurobond market began the week on a bearish trend, following a widespread sell-off across Sub-Saharan Africa and North African regions. This downturn was influenced by pronounced negative sentiments in the technology sector, particularly related to artificial intelligence (AI) equities.
Practically, Chinese DeepSeek rattles the global market on Monday. Concerns regarding the emergence of a more cost-effective AI model from China, potentially threatening the market dominance of US technology companies, contributed to the overall pessimism.
Consequently, the average mid-yield for Nigerian bonds increased as a result of a bearish trend on African bonds, reversing the previous week’s trend. Notably, the Nov-25 and Nov-27 maturities recorded the most significant increase in yield, rising by 26 bps and 11 bps, respectively.
Similar bearish sentiment was observed across the curve in Ghana, South Africa, and Angola. #Yield Climbs as Bears Touch Nigeria’s Eurobonds Edun Highlights Nigeria’s Leadership in Africa’s Energy Transition
