Economy

Traders May Stick to Sidelines After Last Week’s Sell-Off

Published

7 years ago

10/12/2018

By Investors Hub

The major U.S. index futures are pointing to a roughly flat open on Monday following the sell-off seen on Wall Street last week.

Traders may look to pick up stocks at reduced levels, although concerns about the global economic outlook and skepticism about the potential for a long-term trade deal between the U.S. and China is likely to sap investors risk appetite.

Overall trading activity may be somewhat subdued, with a lack of major U.S. economic data likely to keep some traders on the sidelines.

The economic calendar remains relatively light throughout the week, although reports on producer and consumer price inflation, retail sales, and industrial production are likely to attract attention.

Traders may nonetheless remain reluctant to make significant moves ahead of the Federal Reserve?s monetary policy meeting next week.

With the Fed widely expected to raise interest rates by another quarter point, traders will closely scrutinize the accompanying statement for clues about future rate hikes.

Traders may look to pick up stocks at reduced levels on the heels of last week?s sell-off, which came amid skepticism about the potential for a long-term trade deal between the U.S. and China.

Overall trading activity may be somewhat subdued, however, with a lack of major U.S. economic data likely to keep some traders on the sidelines.

The economic calendar remains relatively light throughout the week, although reports on producer and consumer price inflation, retail sales, and industrial production are likely to attract attention.

Traders may nonetheless be reluctant to make significant moves ahead of the Federal Reserve?s monetary policy meeting next week.

With the Fed widely expected to raise interest rates by another quarter point, traders will closely scrutinize the accompanying statement for clues about future rate hikes.

After fluctuating early in the session, stocks moved sharply lower over the course of the trading day on Friday. The major averages showed a substantial move back to the downside following the rebound from early weakness seen on Thursday.

The major averages climbed off their worst levels going into the close but remained firmly negative. The Dow tumbled 558.72 points or 2.2 percent to 24,388.95, the Nasdaq plunged 219.01 points or 3.1 percent to 6,969.25 and the S&P 500 slumped 62.87 points or 2.3 percent to 2,633.08.

With the steep drop on the day, the major averages moved significantly lower for the week. The Nasdaq nosedived by 4.9 percent, while the Dow and the S&P 500 plummeted by 4.5 percent and 4.6 percent, respectively.

The sell-off on Wall Street came after the Labor Department’s closely watched monthly jobs report showed U.S. employment increased by much less than expected in the month of November.

The Labor Department said non-farm payroll employment rose by 155,000 jobs in November after surging up by a downwardly revised 237,000 jobs in October.

Economists had expected employment to climb by about 200,000 jobs compared to the jump of 250,000 jobs originally reported for the previous month.

Meanwhile, the report said the unemployment rate in November remained unchanged for the second straight month at 3.7 percent, holding at its lowest level since hitting 3.5 percent in December of 1969.

Average hourly employee earnings rose by $0.06 to $27.35 in November, reflecting a 3.1 percent increase compared to the same month a year ago. The annual rate of growth was unchanged from October.

“The slightly more modest 155,000 gain in payroll employment in November may not go down well in markets given the heightened nervousness in recent months,” said Paul Ashworth, Chief U.S. Economist at Capital Economics.

“But this is still a solid gain that suggests economic growth is gradually slowing back towards its potential pace,” he added. “There is nothing here to suggest the economy is suffering a more sudden downturn.”

Lingering skepticism about a U.S.-China trade agreement also weighed on the markets even though President Donald Trump tweeted, “China talks are going very well!”

Most of the major sectors showed notable moves to the downside over the course of the session, reflecting a broad based sell-off on Wall Street.

Computer hardware stocks showed a particularly steep drop on the day, dragging the NYSE Arca Computer Hardware Index down by 4.1 percent to a nearly two-year closing low.

Tech giant IBM Corp. (IBM) posted a significant loss after agreeing to sell some of its software products to India-based HCL Technologies for $1.8 billion.

Substantial weakness was also visible among transportation stocks, as reflected by the 3.9 percent nosedive by the Dow Jones Transpiration Average. The average tumbled to its lowest closing level in well over a month.

Semiconductor, software, biotechnology, and retail stocks also saw considerable weakness, while gold stocks were among the few groups to buck the downtrend amid an increase by the price of the precious metal.

Economy

OPEC Crude Output Falls to 37-Year Low Amid Iran Disruptions

Published

2 hours ago

05/06/2026

Adedapo Adesanya

By Adedapo Adesanya

Crude production under the collective Organisation of the Petroleum Exporting Countries (OPEC ) fell in May to its lowest level in at least 37 years as the blockade of Iran by the United States and disruptions in the Persian Gulf, continued to limit output.

According to a Bloomberg survey released on Friday, output from the organisation’s 11 current members, including Nigeria, dropped by 1.22 million barrels per day to 16.33 million barrels per day last month.

Iran accounted for more than half of the decline. The data excludes the United Arab Emirates (UAE), which departed the cartel last month after six decades of membership.

War between a US-Israeli alliance and Iran has reduced oil supplies from the Middle East, largely closing the Strait of Hormuz waterway. Saudi Arabia, Iraq, the UAE and Kuwait have been forced to cut crude production. Iranian shipments face additional pressure following a US blockade of its ports imposed in mid-April.

Iranian output fell by 710,000 barrels per day to a five-year low of 2.34 million barrels per day in May, the survey showed. Central Command reported that US forces have redirected 127 commercial vessels to enforce the blockade of all maritime traffic entering and exiting Iranian ports.

Kuwait recorded the second-largest decline last month, with production falling by 310,000 barrels per day to 490,000 barrels per day, less than one-fifth of pre-war levels. Saudi Arabia, the group’s leader, saw output decrease by 240,000 barrels per day to 6.57 million barrels per day.

The production reductions have not prevented OPEC and its allies from raising quotas over recent months, continuing a year-long process of restoring output halted several years ago.

This comes ahead of a meeting scheduled to be held on Sunday, June 7, where a sub-group of seven members is expected to increase targets by 188,000 barrels again in July. The session is one of four online meetings OPEC and its partners plan to hold that day.

Delegates indicated the alliance has plans for two additional monthly quota increases in August and September. UAE output rose by 300,000 barrels per day to 2.44 million barrels per day in May, according to the survey.

Economy

Debt Repayments: FG Overshoots Budget Allocation by 18%

Published

2 hours ago

05/06/2026

Aduragbemi Omiyale

By Aduragbemi Omiyale

The 2025 third quarter Budget Implementation Report from the Budget Office of the Federation has shown that the federal government exceeded the funds allocation for repayment of debts for the first nine months of the fiscal year by about 18 per cent.

In a report by Punch, the sum of N10.74 trillion was budgeted for debt servicing between January and September 2025, but the government used N12.63 trillion for the purpose, N1.90 trillion or 17.65 per cent more than the allocation for the year.

The funds were spent on domestic debts, foreign debts and sinking fund by the central government in nine months.

Business Post reports that for the whole year, the amount approved by the National Assembly and signed by President Bola Tinubu for debt repayments was N14.31 trillion.

Looking at the nine-month figures, domestic debt service gulped N6.23 trillion, exceeding its N5.39 trillion provision, while foreign debt service was N6.30 trillion versus the budget provision of N5.06 trillion.

According to the report, the figures indicated that 67.2 per cent of the federal government’s retained revenue of N18.63 trillion was spent on debt service in the first nine months of 2025. When the sinking fund is included, debt-related payments consumed about 67.8 per cent of revenue.

It was also observed that aggregate federal government revenue underperformed the budget by N12.03 trillion or 39.24 per cent, as actual revenue of N18.63 trillion fell short of the N30.67 trillion projected for the first three quarters.

In the third quarter alone, the government generated N7.70 trillion versus the quarterly target of N10.22 trillion as a result of persistent oil revenue shortfalls, despite stronger non-oil collections.

The debt burden also crowded out capital spending, as total capital expenditure was N3.10 trillion in the first nine months compared with the N17.58 trillion budgeted for the period, indicating that actual debt-related payments were more than four times capital expenditure.

Economy

Unlisted Stock Investors’ Wealth Shrinks N30bn

Published

11 hours ago

05/06/2026

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange recorded a loss of 1.13 per cent on Thursday, June 4, shrinking the market capitalisation by N30.03 billion to N2.630 trillion from N2.660 trillion on Wednesday.

Similarly, this brought down the NASD Unlisted Security Index (NSI) by 50.19 points to 4,396.08 points from the 4,446.27 points recorded a day earlier.

The loss was influenced by the overpowering of the bulls by the bears, after the bourse closed with two price gainers and three price losers, led by FrieslandCampina Wamco Nigeria Plc, which slumped by N20.03 to sell at N190.38 per unit compared with midweek’s N210.41 per unit. Food Concepts Plc declined by 25 Kobo to trade at N2.50 per share versus the previous day’s N3.00 per share, and Acorn Petroleum Plc crumbled by 2 Kobo to end at N1.32 per unit, in contrast to the preceding session’s N1.34 per unit.

For the gainers, Central Securities Clearing System (CSCS) Plc added N2.93 to close at N78.34 per share compared with the previous price of N75.41 per share, and Afriland Properties Plc gained 80 Kobo to settle at N16.80 per unit versus N16.00 per unit.

There was a slip in the volume of transactions yesterday by 46.8 per cent to 280,714 units from 527,221 units, as the value of trades dropped 66.5 per cent to N21.8 million from the preceding session’s N64.2 million, and the number of deals fell by 8.7 per cent to 42 deals from 46 deals.

Great Nigeria Insurance (GNI) Plc ended the session as the most traded stock by value on a year-to-date basis with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 64.7 million units traded for N4.4 billion.

GNI Plc also finished the day as the most traded stock by volume on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Infracredit Plc with 2.3 billion units exchanged for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.