Economy
Optimism on Further Stimulus Spikes Buying Interest
By Investors Hub
The major U.S. index futures are currently pointing to a higher opening on Monday, with stocks likely to add to the strong gains posted last week.
The markets may benefit from optimism about further stimulus from global central banks, with the European Central Bank expected to cut interest rates at a meeting on Thursday.
Expectations for another interest rate by the U.S. Federal Reserve next week were also bolstered by last Friday?s weaker than expected jobs data.
Data from China showing an unexpected drop in exports in August has also added to the hopes of more stimulus to stave off a global recession.
Official data showed Chinese exports in August unexpectedly fell by 1 percent compared to year ago, reflecting the ongoing trade dispute with the U.S.
Subsequently, the trade war also remains on investors? minds, although traders seem optimistic about high-level trade talks scheduled for next month.
Some political observers have suggested President Donald Trump may soften his stance on China in order to reach an agreement and prevent a U.S. recession just before Election Day.
Following the strong upward move seen last Wednesday and Thursday, stocks showed a lack of direction during trading on Friday. The major averages spent much of the day bouncing back and forth across the unchanged line before closing mixed.
While the tech-heavy Nasdaq dipped 13.75 points or 0.2 percent to 8,103.07, the Dow and the S&P 500 reached their best closing levels in over a month. The Dow rose 69.31 points or 0.3 percent to 26,797.46 and the S&P 500 inched up 2.71 points or 0.1 percent to 2,978.71.
Despite the mixed performance on the day, the major averages all moved notably higher for the holiday-shortened week. The Dow jumped by 1.5 percent, while the Nasdaq and the S&P 500 both surged up by 1.8 percent.
The choppy trading on Wall Street came following the release of a closely watched report from the Labor Department showing weaker than expected job growth in the month of August.
The report said non-farm payroll employment rose by 130,000 jobs in August after climbing by a downwardly revised 159,000 jobs in July.
Economists had expected employment to increase by about 158,000 jobs compared to the addition of 164,000 jobs originally reported for the previous month.
The weaker than expected job growth came as notable increases in employment in healthcare and financial activities were partly offset by the loss of mining and retail jobs.
The report said government employment climbed by 34,000 jobs, largely reflecting the hiring of temporary workers for the 2020 Census.
Meanwhile, the Labor Department said the unemployment rate held at 3.7 percent in August, unchanged from July and in line with economist estimates.
The report also said average hourly employee earnings climbed by $0.11 to $28.11 in August following 9-cent gains in both June and July.
“Payrolls growth is slowing but wages are picking up, which underlines the difficult decision facing the Federal Reserve,” said ING Chief International Economist James Knightley.
He added, “The risks from a deteriorating international backdrop and a manufacturing recession mean we still look for September and December rate cuts.”
Meanwhile, traders largely shrugged off comments from Federal Reserve Chairman Jerome Powell, who argued the central has helped keep the economy on solid ground amid the uncertainty caused by President Donald Trump’s trade war with China.
“The Fed has through the course of the year seen fit to lower the expected path of interest rates,” Powell said during a forum in Zurich, Switzerland. “That has supported the economy. That is one of the reasons why the outlook is still a favorable one.”
Powell argued that the uncertainty caused by the escalating trade dispute between the U.S. and China has caused some companies to hold back on investment
“We’ve been hearing quite a bit about uncertainty,” Powell said. “So for businesses, to particularly make longer-term investments in plants or equipment or software, they want some certainty that the demand will be there.”
Despite the uncertainty cause by the trade war, Powell noted the Fed does not currently anticipate a recession, noting the labor market and consumer spending remain strong.
“We’re not forecasting or expecting a recession,” the Fed chief said. “The most likely outlook is still moderate growth, a strong labor market and inflation continuing to move back up.”
Powell also reiterated his oft-repeated pledge that the Fed will “act as appropriate” to sustain the U.S. economic expansion.
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.
Gold stocks showed a substantial move to the downside, however, with the NYSE Arca Gold Bugs Index plunging by 3.2 percent. The sell-off by gold stocks came as the price of the precious metal turned lower after seeing initial strength.
Natural gas stocks climbed off their worst levels but also saw notable weakness on the day, while some strength was visible among tobacco stocks.
By Dipo Olowookere
Investors at the Nigerian Exchange (NGX) Limited have continued to show excitement for the full-year earnings of companies on the exchange so far.
On Friday, Customs Street further appreciated by 1.01 per cent as more organization released their financial statements for the 2025 fiscal year.
During the session, traders continued their selective trading strategy, with the energy sector going up by 2.47 per cent at the close of business despite profit-taking in the banking counter, which saw its index down by 0.11 per cent.
Yesterday, the insurance space grew by 2.16 per cent, the industrial goods segment expanded by 1.70 per cent, and the consumer goods industry jumped by 0.42 per cent.
Consequently, the All-Share Index (ASI) increased by 1,722.13 points to 171,727.49 points from 170,005.36 points, and the market capitalisation soared by N1.106 trillion to N110.235 trillion from the N109.129 trillion it ended on Thursday.
Business Post reports that there were 59 appreciating stocks and 19 depreciating stocks on Friday, representing a positive market breadth index and strong investor sentiment.
The trio of Omatek, Deap Capital, and NAHCO gained 10.00 per cent each to sell for N2.64, N6.82, and N136.40 apiece, as Zichis and Austin Laz appreciated by 9.98 per cent each to close at N6.72 and N5.40, respectively.
Conversely, The Initiates depreciated by 9.74 per cent to N19.45, DAAR Communications slumped by 7.32 per cent to N1.90, United Capital crashed by 6.55 per cent to N18.55, Coronation Insurance lost 5.71 per cent to quote at N3.30, and First Holdco shrank by 5.53 per cent to N47.00.
The activity chart showed an improvement in the activity level, with the trading volume, value, and number of deals up by 33.77 per cent, 93.27 per cent, and 10.63 per cent, respectively.
This was because traders transacted 953.8 million shares worth N43.1 billion in 51,005 deals compared with the 713.0 million shares valued at N22.3 billion traded in 46,104 deals a day earlier.
Fidelity Bank was the most active with 92.4 million units sold for N1.8 billion, Chams transacted 69.2 million units valued at N310.9 million, Deap Capital exchanged 59.1 million units worth N382.7 million, Access Holdings traded 57.2 million units valued at N1.3 billion, and Tantalizers transacted 48.6 million units worth N228.2 million.
By Adedapo Adesanya
The value of the Naira contracted against the United States Dollar on Friday by 13 Kobo or 0.01 per cent to N1,366.19/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) from the previous day’s value of N1,366.06/$1.
According to data from the Central Bank of Nigeria (CBN), the Nigerian currency also depreciated against the Pound Sterling in the same market window yesterday by N2.37 to N1,857.75/£1 from the N1,855.38/£1 it was traded on Thursday, and further depleted against the Euro by 57 Kobo to close at N1,612.52/€1 versus the preceding session’s N1,611.95/€1.
In the same vein, the exchange rate for international transactions on the GTBank Naira card showed that the Naira lost N8 on the greenback yesterday to N1,383/$1 from the previous day’s N1,375/$1 and at the black market, the Nigerian currency maintained stability against the Dollar at N1,450/$1.
FX analysts anticipate this trend to persist, primarily influenced by increasing external reserves, renewed inflows of foreign portfolio investments, and a reduction in speculative demand.
In the short term, stability in the FX market is expected to continue, supported by policy interventions and improving market confidence.
Nigeria’s foreign reserves experienced an upward trajectory, increasing by $632.38 million within the week to $46.91 billion from $46.27 billion in the previous week.
The Dollar appreciation this week appears to be largely technical, serving as a correction to the substantial losses experienced from mid- to late January.
Meanwhile, the cryptocurrency market slightly appreciated, with Bitcoin (BTC) climbing near $68,000, up nearly 5 per cent since hitting $60,000 late on Thursday after investor confidence in crypto’s utility as a store of value, inflation hedge, and digital currency faltered.
The sell-off extended beyond crypto, with silver plunging 15 per cent and gold sliding more than 2 per cent. US stocks also fell.
The latest recoup saw the price of BTC up by 4.7 per cent to $67,978.96, as Ethereum (ETH) appreciated by 6.3 per cent to $2,021.10, and Ripple (XRP) surged by 9.5 per cent to $1.42.
In addition, Solana (SOL) grew by 7.3 per cent to $85.22, Cardano (ADA) added 6.1 per cent to trade at $0.2683, Dogecoin (DOGE) expanded by 5.4 per cent to $0.0958, Litecoin (LTC) rose by 5.2 per cent to $53.50, and Binance Coin (BNB) jumped by 2.3 per cent to $637.79, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
By Adedapo Adesanya
Oil prices settled higher on Friday as traders worried that this week’s talks between the US and Iran had failed to reduce the risk of a military conflict between the two countries.
Brent crude futures traded at $68.05 a barrel after going up by 50 cents or 0.74 per cent, and the US West Texas Intermediate (WTI) crude futures finished at $63.55 a barrel due to the addition of 26 cents or 0.41 per cent.
Iran and the US held negotiations in Muscat, the capital of Oman, on Friday to overcome sharp differences over Iran’s nuclear programme.
It was reported that the talks had ended with Iran’s foreign minister saying negotiators will return to their capitals for consultations and the talks will continue.
Regardless, the meeting kept investors anxious about geopolitical risk, as Iran wanted to stick to nuclear issues while the US wanted to discuss Iran’s ballistic missiles and support for armed groups in the region.
Any escalation of tension between the two nations could disrupt oil flows, since about a fifth of the world’s total consumption passes through the Strait of Hormuz between Oman and Iran.
Saudi Arabia, the United Arab Emirates, Kuwait and Iraq export most of their crude via the strait, as does Iran, which is a member of the Organisation of the Petroleum Exporting Countries (OPEC).
According to Reuters, Iran objected to the presence of any US Central Command (CENTCOM) or other regional military officials, saying that would jeopardise the process.
The current confrontation was sparked by more than two weeks of unrest in Iran that saw authorities launch a deadly crackdown that killed thousands of civilians and shocked the world. As reports of the deaths trickled out of Iran, US President Donald Trump threatened to strike Iran if any of the tens of thousands of protesters arrested were executed.
Meanwhile, Kazakhstan’s planned oil exports could fall by as much as 35 per cent this month via its main route through Russia, as the country’s top oil company, Tengiz oilfield, slowly recovers from fires at power facilities in January.
ING analysts have pointed out Iran’s neighbour, Iraq, and a disagreement with the US as another bullish factor for oil prices. It seems Iraqi politicians favour Mr Nouri al-Maliki as the country’s next Prime Minister, but the US thinks Mr al-Maliki is too close to Iran. President Trump has already threatened the oil producer with consequences if he emerges as PM.
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