Nigerian markets extend rally after Buhari's election victory

Nigerian stocks leapt to an 18-week high on Thursday while the 5-year bond yield fell as investors snapped up assets in Africa's biggest economy after a peaceful presidential vote won by the opposition leader.
Muhammadu Buhari's election victory marks the first time in Africa's most populous nation where a sitting government has been removed from power through the ballot box.
Analysts said investors were hopeful that the scandals that undermined incumbent Goodluck Jonathan's popularity, including billions of dollars unaccounted for in missing oil receipts and the Boko Haram insurgency which has killed thousands, would be addressed under Buhari's administration.
"Buhari is a breath of fresh air for the markets and Nigeria as whole. Apart from peaceful elections, we believe it won't be business as usual, that's part of the positive sentiment," Ayodeji Ebo, head of research at Afrinvest said.
The yield on the 2019 bond, one of the maturities listed on JP Morgan's Government Bond Index-Emerging Markets (GBI-EM), has fallen more than 110 basis points over the past two days on renewed buying on news of Buhari's victory.
"It's a buyers market. Yields are falling across the board. Some banks have booked orders from offshore investors for bonds," one dealer at a major lender, told Reuters.
The naira firmed to 210 naira on the parallel market, from 217 to the dollar on Wednesday.
On the interbank market, the currency opened at 199.50 to the dollar, a range it has traded at since February, after the central bank pegged the rate, following a de facto devaluation.
The naira was officially devalued in November and had lost almost 20 percent since, under pressure from falling global oil prices and political uncertainty over a six-week delay of the presidential election which unnerved investors.
In a sign of relief, individuals who had stockpiled dollars to hedge against political risk were exchanging their funds for the naira, buoying the local unit, black market dealers said.