Economy
Lingering Trade War Concerns May Consume US Stocks
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Monday, with stocks likely to move back to the downside after ending last Friday?s trading mostly higher.
Continued concerns about a global trade war are likely to weigh on the markets after a report from the Wall Street Journal said President Donald Trump plans to ban many Chinese companies from investing in U.S. technology firms and block additional technology exports to Beijing.
Trump also continued his harsh rhetoric on trade in a post on Twitter on Sunday, urging countries to remove ?artificial? trade barriers on tariffs on U.S. goods.
?The United States is insisting that all countries that have placed artificial Trade Barriers and Tariffs on goods going into their country, remove those Barriers & Tariffs or be met with more than Reciprocity by the U.S.A. Trade must be fair and no longer a one way street!? Trump tweeted.
Stocks moved mostly higher during trading on Friday, although the tech-heavy Nasdaq ended the day modestly below the unchanged line. The advance by the Dow allowed the blue chip index to avoid its longest losing streak in over forty years.
The major averages finished the session mixed. The Nasdaq dipped 20.14 points or 0.3 percent to 7,692.82, while the Dow climbed 119.19 points or 0.5 percent to 24,580.89 and the S&P 500 rose 5.13 points or 0.2 percent to 2,754.89.
Despite the mixed performance on the day, the major averages all moved lower for the week. While the Dow slumped by 2 percent, the Nasdaq and the S&P 500 slid by 0.7 percent and 0.9 percent, respectively.
A rally by energy stocks contributed to the strength on Wall Street, as the price of crude oil spiked higher on news out of the closely watched OPEC meeting in Vienna, Austria.
Reports earlier in the day indicated OPEC planned to increase oil production by about 1 million barrels per day, although a statement from the cartel did not provide a specific figure.
OPEC only noted that it was overshooting the output reduction target put in place in November of 2016 and said it will “strive to adhere to the overall conformity level of OPEC-12, down to 100%.”
Reflecting the strength in the energy sector, the Philadelphia Oil Service Index spiked by 3.6 percent, the NYSE Arca Oil Index surged up by 2.6 percent and the NYSE Arca Natural Gas Index jumped by 2 percent.
Steel stocks also saw considerable strength on the day, driving the NYSE Arca Steel Index up by 2.1 percent. The index bounced off its lowest closing level in over two months.
Chemical and gold stocks also showed strong moves to the upside, while weakness was visible among banking and semiconductor stocks.
Traders largely shrugged off lingering trade concerns even as President Donald Trump threatened to impose a 20 percent tariff on all cars imported to the U.S. from the European Union.
Trump claimed in a post on Twitter that he would impose the new tariffs unless the EU removes tariffs and trade barriers placed on the U.S.
“Based on the Tariffs and Trade Barriers long placed on the U.S. and it great companies and workers by the European Union, if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!” Trump tweeted.
The latest tweet from Trump came after he threatened to escalate the ongoing trade dispute with China earlier this week.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited ended in the green territory on Monday after it chalked up 0.57 per cent on the back of renewed buying interest in financial equities.
The local stock exchange witnessed the insurance and the banking counters closing higher by 0.54 per cent and 0.08 per cent, respectively, amid profit-taking in the others. The energy index shed 1.77 per cent and the consumer goods sector depreciated by 0.26 per cent, while the industrial goods industry was flat.
At the close of business, the All-Share Index (ASI) went up by 1,412.65 points to 251,125.02 points from 249,712.37 points, and the market capitalisation soared by N906 billion to N160.983 trillion from N160.077 trillion.
Investor sentiment was bullish yesterday after Customs Street ended with 35 price gainers and 30 price losers, indicating a positive market breadth index.
Airtel Africa surged 10.00 per cent to N3,655.70, International Energy Insurance advanced by 9.68 per cent to N3.74, Sovereign Trust Insurance went up by 9.65 per cent to N2.50, Caverton rose by 9.63 per cent to N7.40, and VFD Group gained 9.55 per cent to close at N10.90.
Conversely, McNichols lost 10.00 per cent to finish at N7.20, The Initiates dropped 9.91 per cent to trade at N30.45, Learn Africa slipped by 9.69 per cent to N11.65, Zichis crashed by 7.93 per cent to N30.98, and May and Baker declined by 6.60 per cent to N46.70.
During the trading day, market participants transacted 629.4 million shares worth N40.9 billion in 82,434 deals compared with the 711.9 million shares valued at 29.1 billion traded in 62,386 deals last Friday, implying a decline in the trading volume by 11.59 per cent, and a rise in the trading value and number of deals by 40.55 per cent and 32.14 per cent, respectively.
Access Holdings was the busiest equity for the session with a turnover of 61.3 million units valued at N1.5 billion. Zenith Bank traded 37.9 million units worth N5.0 billion, Fidelity Bank sold 35.8 million units for N851.2 million, Japaul exchanged 24.7 million units valued at N90.9 million, and Tantalizers transacted 22.8 million units worth N103.2 million.
By Adedapo Adesanya
The Naira appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) by 54 Kobo or 0.04 per cent on Monday, May 25, to trade at N1,374.92/$1 compared to last Friday’s value of N1,375.46/$1.
However, it further depreciated against the Pound Sterling in the official market during the session by N6.01 to sell for N1,855.73/£1 versus the preceding session’s N1,849.72/£1 and lost N158.02 against the Euro to close at N1,755.06/€1, in contrast to the N1,590.04/€1 it was traded last Friday.
In the same vein, the Nigerian Naira weakened against the United States Dollar at the GTBank FX counter yesterday by N2 to quote at N1,383/$1 versus N1,381/$1, and gained N5 in the parallel market to settle at N1,385/$1 compared with the previous rate of N1,390/$1.
The performance of the domestic currency comes as the external reserves inched higher to $48.72 billion, indicating a complex mix of sustained FX demand pressures and modest reserve accretion.
The movement in the FX market underscores the continued tension between demand-side pressure and policy-driven attempts to stabilise the naira.
While recent monetary tightening measures by the Central Bank of Nigeria (CBN) have helped to moderate extreme volatility, market participants are struggling to navigate a landscape shaped by intermittent dollar inflows, import-related demand and shifting investor sentiment.
As for the cryptocurrency market, most tokens were up amid optimism of a near-term US-Iran peace deal, as Iranian negotiators arrived in Doha, Qatar, for talks.
The Strait of Hormuz has been largely blockaded since the US and Israel struck Iran on February 28, though traffic has partially resumed in recent days. The agenda would include the reopening as well as uranium control.
TRON (TRX) rose by 1.8 per cent to $0.3714, Cardano (ADA) added 1.2 per cent to trade at $0.2444, Bitcoin (BTC) improved by 0.9 per cent to $77,283.62, Binance Coin (BNB) jumped 0.8 per cent to $661.30, and Ripple (XRP) increased by 0.8 per cent to $1.35.
Further, Ethereum (ETH) grew by 0.7 per cent to $2,018.82, Solana (SOL) expanded by 0.6 per cent to $85.37, and Dogecoin (DOGE) appreciated by 0.6 per cent to $0.1001, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Adedapo Adesanya
Oil prices fell nearly 7 per cent on Monday as optimism grew that the United States and Iran were moving closer to a peace deal that would reopen the Strait of Hormuz.
Brent crude futures were down by $7.24 or almost 7 per cent to $96.30 a barrel, and the US West Texas Intermediate (WTI) crude futures decreased by $6.30 or 6.5 per cent to trade at $90.88 per barrel.
Comments by President Donald Trump that diplomatic negotiations with Iran are advancing eased market fears of severe energy supply disruptions due to the Middle East conflict.
This is as a top negotiator of Iran, and its foreign minister was in Doha for talks with Qatar’s prime minister on a potential deal with the US to end the three-month-old war
Recently, both countries have downplayed expectations for an immediate peace agreement to end their three-month-old war, backing away from claims of an imminent breakthrough.
President Trump later revealed that he has instructed negotiators not to rush the process, asserting that the US naval blockade on Iranian ports will remain in full effect until a finalised accord is certified and signed.
Also, the US Secretary of State Marco Rubio has affirmed that the US government will exhaust diplomatic channels, also warning that it will handle Iran in “another way” if a good agreement cannot be secured, hinting at a potential return to active war.
The deal outlines a process to fully reopen the vital global shipping lane without tolls, resolving the global energy crunch. Iran would receive targeted sanctions relief and the gradual unfreezing of up to $20 billion to $25 billion in assets currently held in foreign banks.
Even if a peace deal is reached, analysts expect a return to normal oil flows through the strait will take months, while damaged oil and gas facilities are repaired. There is currently a supply shortfall of up to 11 million barrels per day of crude oil that does not go away immediately, even if a deal is reached soon.
Ship-tracking data showed three Liquefied Natural Gas (LNG) tankers passed through the strait in recent days, heading to Pakistan, China and India, as well as a supertanker with Iraqi crude for China after being stranded for nearly three months.
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