Economy
Downward Momentum Persists Amid Lingering Concerns About Economy, Trade
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Monday, with stocks likely to see further downside following the sell-off seen last Friday.
The downward momentum on Wall Street comes amid lingering concerns about global economic growth as well as continued uncertainty about trade between the U.S. and China.
Traders may also be on edge ahead of the Federal Reserve?s highly anticipated monetary policy announcement scheduled for Wednesday.
The Fed is widely expected to raise interest rates by another quarter point, although traders are likely to closely scrutinize the central bank?s accompanying statement and forecasts for clues about future rate hikes.
Negative sentiment may also be generated in reaction to a report from the New York Federal Reserve showing a substantial slowdown in the pace of growth in regional manufacturing activity in the month of December.
Stocks have recently seen considerable volatility, however, suggesting an early move to the downside may not be the end of the day?s story for the markets.
Following the lackluster performance in the previous session, stocks moved sharply lower over the course of the trading day on Friday. The Dow and the S&P 500 tumbled to their lowest closing levels in seven and eight months, respectively.
The major averages climbed off their worst levels going into the close but remained firmly negative. The Dow plunged 496.87 points or 2 percent to 24,100.51, the Nasdaq nosedived 159.67 points or 2.3 percent to 6,910.67 and the S&P 500 plummeted 50.59 points or 1.9 percent to 2,599.95.
With the steep losses on the day, the major averages also moved lower for the week. The Nasdaq slid by 0.8 percent, while the Dow and the S&P 500 slumped by 1.2 percent and 1.3 percent, respectively.
The sell-off on Wall Street came amid renewed concerns about the outlook for global economic growth following the release of data showing disappointing industrial output and retail sales growth in China.
The latest batch of economic data showed Chinese industrial output grew at its slowest pace in nearly three years, increasing by 5.4 percent in November after growing by 5.9 percent a month earlier.
Meanwhile, retail sales in China grew 8.1 percent in November, the weakest growth since 2003. In October, retail sales were up 8.6 percent.
The slower pace of industrial output and retail sales growth was partly due to the impact of the ongoing trade dispute with the U.S.
President Donald Trump appeared to take credit for China’s disappointing economic data in a post on Twitter on Friday.
“China just announced that their economy is growing much slower than anticipated because of our Trade War with them,” Trump tweeted. “U.S. is doing very well. China wants to make a big and very comprehensive deal. It could happen, and rather soon!”
Trump seemed to reference China’s recently confirmed decision to temporarily lower tariffs on vehicles made in the U.S. to 15 percent from 40 percent.
A report showing growth in the eurozone private sector has decelerated to its slowest pace in more than four years in December added to the negative sentiment.
On the U.S. economic front, the Commerce Department released a report showing slightly weaker than expected retail sales growth in November due to a steep drop in sales by gas stations, although underlying retail sales growth remained strong.
The Commerce Department said retail sales edged up by 0.2 percent in November after spiking by an upwardly revised 1.1 percent in October.
Economists had expected retail sales to rise by 0.3 percent compared to the 0.8 percent increase originally reported for the previous month.
Meanwhile, the report said closely watched core retail sales, which exclude autos, gasoline, building materials and food services, increased by 0.9 percent in November after climbing by an upwardly revised 0.7 percent in October.
“Along with the continued strength of the labor market, the boost to real incomes from the recent plunge in gasoline prices appears to be providing a big support to spending growth, which could continue for a few more months,” said Andrew Hunter, Senior U.S. Economist at Capital Economics.
He added, “Nonetheless, with the earlier boost from tax cuts now fading and rising interest rates likely to become an increasing drag, we still expect consumption growth to slow next year.”
A separate report from the Federal Reserve showed a much bigger than expected increase in industrial production in November, but manufacturing output was unchanged.
Oil service stocks showed a substantial move to the downside on the day, extending a recent sell-off. The Philadelphia Oil Service Index plunged by 4.3 percent to its lowest closing level in fifteen years. The continued weakness among oil service stocks came amid a steep stop by the price of crude oil.
Significant weakness was also visible among pharmaceutical stocks, as reflected by the 3.4 percent slump by the NYSE Arca Pharmaceutical Index
Johnson & Johnson (JNJ) posted a steep loss after a report from Reuters said the healthcare giant knew for decades that its talcum baby powder supply contained asbestos.
Natural gas, software, retail and gold stocks also saw considerable weakness on the day amid a broad based sell-off on Wall Street.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange extended its gains by 0.91 per cent on Wednesday, June 3, spurred by three price gainers led by FrieslandCampina Wamco Nigeria Plc, which rose by N13.90 to sell N210.41 per share versus the previous day’s N196.51 per share. MRS Oil appreciated by N10 to N190.00 per unit from N180.00 per unit, and Food Concepts Plc added 5 Kobo to sell at N3.00 per share versus N2.95 per share.
As a result, the market capitalisation increased by N23.91 billion to N2.660 trillion from N2.636 trillion, and the NASD Unlisted Security Index (NSI) gained 39.97 points to finish at 4,446.27 points, in contrast to Tuesday’s 4,406.30 points.
The NASD exchange witnessed three price losers at midweek, led by Nipco Plc, which shrank by N21.30 to close at N325.97 per unit compared with the previous session’s N347.27 per unit, Nitrox Industrial Gases Plc went down by N1.20 to quote at N24.30 per share versus the preceding session’s N25.50 per share, and Central Securities Clearing System (CSCS) Plc weakened to by 69 Kobo to N75.41 per unit from N76.10 per unit.
The volume of trades yesterday significantly improved by 71.5 per cent to 527,221 units from Tuesday’s 307,363 units, as the value of transactions soared by 49.9 per cent to N64.2 million from the preceding session’s N49.9 million, and the number of deals surged by 9.5 per cent to 46 deals from 42 deals.
When trading activities ended for the day, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis with 3.4 billion units valued at N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units worth N6.5 billion, and CSCS Plc with 64.6 million units exchanged for N4.4 billion.
GNI Plc also ended the session as the most traded stock by volume on a year-to-date basis with 3.4 billion units sold for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Adedapo Adesanya
The positive run of the Naira against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) continued on Wednesday, June 3, with the former chalking up N3.79 or 0.28 per cent against the latter, closing at N1,357.26, in contrast to the preceding session’s N1,361.05/$1.
Similarly, the Nigerian currency gained N10.52 against the Pound Sterling in the official market during the session to close at N1,822.67/£1 compared with the previous rate of N1,833.19/£1, and appreciated against the Euro by N9.56 to N1,574.83/€1 from N1,584.39/€1.
Further, at the black market, the Naira improved its value against the greenback at midweek by N5 to trade at N1,375/$1 compared with the N1,380/$1 it was traded a day earlier, and at the GTBank FX counter, it gained N6 to sell for N1,372/$1 versus N1,378/$1.
The boost came as the country’s external reserves continued to gain momentum. A look at the updated data from the Central Bank of Nigeria (CBN) showed that foreign reserves continue to increase with two consecutive inflows in June 2026, settling at $49.876 billion as of Tuesday.
Foreign portfolio investors, exporters and non-bank corporates continue to keep the supply side strong, with the less aggressive FX interventions by the CBN at the official window in recent times helping to ease worries about capital flight.
The apex bank reported that interbank FX turnover declined to $133.731 million across 136 deals, from $169.822 million the previous day.
Meanwhile, the cryptocurrency market remained bearish due to sell-offs triggered by geopolitical uncertainties and the US stock market rally.
Cardano (ADA) dipped by 5.5 per cent to $0.2046, Binance Coin (BNB) slumped by 4.8 per cent to $627.56, Solana (SOL) shrank by 3.9 per cent to $72.99, Ethereum (ETH) depreciated by 2.9 per cent to $1,844.53, and Bitcoin (BTC) slipped by 2.7 per cent to $65,675.87.
Further, Dogecoin (DOGE) depleted by 1.4 per cent to $0.0928, Ripple (XRP) declined by 0.7 per cent to $1.21, and TRON (TRX) lost 0.4 per cent to sell at $0.3336, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) gained 0.01 each to settle at $0.9986 and $0.9997, respectively.
By Dipo Olowookere
Nigeria’s stock market further depleted by 1.44 per cent on Wednesday following panic sell-offs by investors, who are cutting down their exposure to local equities.
Business Post observed that profit-taking dominated Customs Street at midweek, with all the key sectors of the Nigerian Exchange (NGX) Limited closing in red.
The insurance space shed 2.76 per cent, the industrial goods index lost 1.55 per cent, the banking counter declined by 1.53 per cent, the consumer goods segment shrank by 0.28 per cent, and the energy sector weakened by 0.05 per cent.
As a result, the All-Share Index (ASI) contracted by 3,554.05 points to 243,132.61 points from 246,686.66 points, and the market capitalisation moderated by N2.279 trillion to N155.940 trillion from N158.219 trillion.
Lafarge Africa led the losers’ chart yesterday after it gave up 9.97 per cent to trade at N307.90, Zichis lost 9.82 per cent to close at N29.20, Learn Africa depreciated by 9.80 per cent to N11.50, John Holt crashed by 9.80 per cent to N13.80, and Consolidated Hallmark dipped by 8.84 per cent to N6.19.
On the flip side, Abbey Mortgage Bank topped the gainers’ log after it grew by 9.93 per cent to N7.75, International Energy Insurance appreciated by 9.89 per cent to N6.00, Tripple G gained 9.80 per cent to sell for N4.37, Universal Insurance expanded by 8.91 per cent to N1.10, and Royal Exchange improved by 7.14 per cent to N1.50.
A total of 17 stocks gained weight yesterday, while 43 stocks lost weight, indicating a negative market breadth index and weak investor sentiment. This has been the mood of the market since the beginning of this week.
Market participants transacted 923.0 million shares worth N42.3 billion in 69,332 deals on Wednesday, in contrast to the 718.8 million shares valued at N29.3 billion traded in 71,683 deals on Tuesday, representing a drop in the number of deals by 3.28 per cent, and a rise in the trading volume and value by 28.41 per cent and 44.37 per cent, respectively.
Sterling Holdings led the activity chart with 264.6 million units valued at N2.1 billion, Access Holdings traded 76.7 million units worth N1.8 billion, Linkage Assurance exchanged 55.1 million units for N99.2 million, VFD Group sold 35.5 million units worth N378.8 million, and Ellah Lakes transacted 33.1 million units valued at N334.3 million.
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