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Africa

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  • Exotix Capital has brought on three new hires to its frontier markets research team ahead of the introduction of MiFID II.
  • Buying the dip has driven investor activity this week with South African bonds causing them to rally despite S&P downgrading the country, and a strong indication that Moody’s will drop its rating to junk in February.
  • Investors in South African bonds have bought on the dip because, even as the country’s economic outlook deteriorates, the only way for bonds is up. But positive reinforcement of the country’s poor governance and deteriorating economy reduces the incentive to reform and only postpones what will be a bigger investor stampede for the exit when the time comes.
  • Growthpoint, the South African listed property investment holding company, has picked banks for its first public deal since 2011. Though deemed an emerging market trade because of the jurisdiction of the issuer, it also appeals to corporate or high grade funds.
  • After a brief sell-off in response to S&P’s decision to cut South Africa’s foreign and local currency issuer rating last Friday, South African assets rallied on Monday, as investors buy on the dip — even though the country’s economic outlook is on a downward trajectory.
  • Nigeria issued a dual tranche 10 and 30 year Eurobond this week that traded up between two and three cash points, as emerging markets (EM) assets recovered after a recent wobble.