Economy
Trade Talks Uncertainty Weigh on Wall Street
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The major U.S. index futures are currently pointing to a lower opening on Monday, with stocks likely to give back ground following the rally seen last Friday.
Lingering concerns about the ongoing U.S.-China trade war may weigh on the markets ahead of the next round of high-level trade talks in Washington later this week.
Ahead of the talks, scheduled to begin on Thursday, a report from Bloomberg News said Chinese officials are signaling they?re increasingly reluctant to agree to the broad trade deal being pursued by President Donald Trump.
Citing people familiar with the discussions, Bloomberg said senior Chinese officials have indicated the range of topics they?re willing to discuss has narrowed considerably.
An offer from Chinese Vice Premier Liu He would purportedly not include reforming Chinese industrial policy or government subsidies.
The upcoming negotiations come as the trade war continues to hang over the economy, with a survey by the National Association for Business Economics showing 53 percent of economists see trade policy as the key downside risk to the economy.
The NABE said four out of five panelists believe that risks to the economic outlook are weighted to the downside, an increase from the 60 percent who held this view in June.
?The panel turned decidedly more pessimistic about the outlook over the summer, with 80% of participants viewing risks to the outlook as tilted to the downside,? said Survey Chair Gregory Daco, chief U.S. economist at Oxford Economics.
He added, ?The rise in protectionism, pervasive trade policy uncertainty, and slower global growth are considered key downside risks to U.S. economic activity.?
Following the significant rebound seen over the course of the trading day last Thursday, stocks showed another substantial move to the upside during trading last Friday. With the rally, the major averages further offset the steep losses posted last Tuesday and Wednesday.
The major averages finished the session just off their best levels of the day. The Dow soared 372.68 points or 1.4 percent to 26,573.72, the Nasdaq surged up 110.21 points or 1.4 percent to 7,982.47 and the S&P 500 spiked 41.38 points or 1.4 percent to 2,952.01.
For the week, the major averages turned in a mixed performance. While the Nasdaq rose by 0.5 percent, the S&P 500 fell by 0.3 percent and the Dow slid by 0.9 percent.
The rally on Wall Street came following the release of a closely watched Labor Department report showing weaker than expected job growth but an unexpected drop in the unemployment rate to a nearly 50-year low.
The mixed data seemed to serve the dual purpose of reinforcing expectations the Federal Reserve will continue cutting interest rates while at the same offsetting concerns about a potential recession.
The report said non-farm payroll employment rose by 136,000 jobs in September compared to economist estimates for an increase of about 145,000 jobs.
Meanwhile, the increases in employment in July and August were upwardly revised to 166,000 jobs and 168,000 jobs, respectively, reflecting the addition of 45,000 more jobs than previously reported.
The average monthly job growth has still slowed from 223,000 jobs per month in 2018 to 161,000 jobs per month so far in 2019.
The Labor Department also said the unemployment rate fell to 3.5 percent in September from 3.7 percent in August. Economists had expected to unemployment rate to remain unchanged.
With the unexpected decrease, the unemployment rate dropped to its lowest level since hitting a matching rate in December of 1969.
The unexpected drop in the unemployment rate came as a 391,000-person jump in the household survey measure of employment more than offset an 117,000-person increase in the size of the labor force.
Even with the unemployment rate hitting a nearly 50-year low, the report said average hourly employee earnings edged down by a penny to $28.09 in September after rising by 11 cents in August.
Compared to the same month a year ago, average hourly earnings were up by 2.9 percent in September, reflecting a notable slowdown from the 3.2 percent increase in August.
Citing headwinds from weaker global growth, trade uncertainty and the strong U.S. dollar, ING Chief International Economist James Knightley expects job growth to average closer to 120,000 for the rest of the year.
“This suggests pay growth is unlikely to accelerate markedly from here and with inflation picking up, the real wage growth story may not be as positive for spending power,” Knightley said. “All in all, it looks as though the Fed will need to step in with more policy easing to support the economy.”
Stocks saw further upside in afternoon trading after Fed Chairman Jerome Powell described the U.S. economy as “in a good place,” and said it is the central bank’s job to “keep it there as long as possible.”
Gold stocks moved sharply higher over the course of the trading session, driving the NYSE Arca Gold Bugs Index up by 2.1 percent. The rally by gold stocks came despite a modest decrease by the price of the precious metal.
Significant strength also emerged among semiconductor stocks, with the Philadelphia Semiconductor Index surging up by 1.9 percent.
Financial, housing, software, and healthcare stocks also saw considerable strength amid broad based buying interest on Wall Street.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange entered a third straight day of losses after it fell by 0.12 per cent on Wednesday, June 10.
The depletion trimmed the market capitalisation further by N3.1 billion to N2.590 trillion from N2.593 trillion, and cut the NASD Unlisted Security Index (NSI) by 5.19 points to 4330.12 points from 4,335.31 points.
11 Plc lost N22.21 during the session to finish at N221.00 per share versus the previous day’s N243.21 per share, MRS Oil Plc depreciated by N6.90 to N158.10 per unit from N165.00 per unit, and Central Securities Clearing System (CSCS) Plc decreased by N2.81 to N78.32 per share from N81.13 per share.
On the flip side, FrieslandCampina Wamco Nigeria Plc went up by N9.27 to N183.08 per unit from N173.81 per unit, Nitrox Industrial Gases Plc added N1.92 to its value to close at N23.80 per share compared with the preceding day’s N21.88 per share, and Food Concepts Plc gained 10 Kobo to exchange at N2.58 per unit, in contrast to Tuesday’s closing price of N2.48 per unit.
At the close of business, the volume of securities traded by investors contracted by 92.6 per cent to 117,374 units from 1.6 million units, and the value of securities moderated by 80.5 per cent to N12.2 million from N62.3 million, while the number of deals increased by 4.9 per cent to 43 deals from 41 deals.
Great Nigeria Insurance (GNI) Plc finished the day 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 traded for N6.5 billion, and CSCS Plc with 65.2 million units exchanged for N4.4 billion.
GNI Plc also closed the session 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 transacted for N6.5 billion, and Resourcery Plc with 1.1 billion units sold for N415.7 million
By Adedapo Adesanya
The Naira fell against the United States Dollar by N1.50 or 0.11 per cent in the Nigerian Autonomous Foreign Exchange Market (NAFEX) to sell at N1,362.05/$1 on Wednesday, June 10, compared with the N1,360.55/$1 it traded on Tuesday.
Also, the local currency lost N4.33 against the Pound Sterling in the official window yesterday to trade at N1,827.33/£1 versus the preceding day’s N1,823.00/£1, and depreciated against the Euro by N1.74 to quote at N1,575.35/€1, in contrast to N1,573.61/€1 of the previous session.
However, at the GTBank forex desk, the Naira gained N3 against the US Dollar to sell at N1,370/$1 versus N1,373/$1, and at the parallel market, it remained unchanged at N1,380/$1.
Updated data from the Central Bank of Nigeria (CBN) showed that foreign reserves surged further due to additional inflows from various sources. Nigeria’s gross external reserves increased to $50.439 billion, its highest level since March 2026, reflecting sustained inflows from oil revenue and other FX sources.
Also, the International Monetary Fund (IMF) has said increased confidence in the Naira, supported by lower and more stable inflation, would encourage households, businesses and investors to hold more local currency assets and reduce reliance on foreign currencies.
The global lender, in a recent assessment, stressed the importance of strengthening the CBN’s operational framework and aligning liquidity management operations more closely with monetary policy objectives.
In the cryptocurrency market, there were recoveries from recent losses as US headline inflation rose an expected 0.5 per cent in May, but the beat on the core rate — which cuts out food and energy costs — pleased markets. The core rate, though, rose just 0.2 per cent in May against forecasts for 0.3 per cent.
The print reinforces the view that the US Federal Reserve will keep interest rates at 350-375 basis points at its June 17 meeting, but is likely to increase rates by 25 basis points by the end of the year.
Cardano (ADA) went up by 2.4 per cent to $0.1647, Bitcoin (BTC) rose by 2.3 per cent to $62,794.09, Binance Coin (BNB) jumped 1.8 per cent to $596.23, Ethereum (ETH) grew by 1.7 per cent to $1,658.12, and Solana (SOL) also soared by 1.7 per cent to $65.23.
Further, Dogecoin (DOGE) appreciated by 1.5 per cent to $0.0849, Ripple (XRP) expanded by 0.4 per cent to $1.11, and TRON (TRX) increased by 0.05 per cent to $0.3218, while the US Dollar Tether (USDT) lost 0.10 per cent to close at $0.9989, and the US Dollar Coin (USDC) declined by 0.01 per cent to $0.9997.
By Adedapo Adesanya
Oil prices jumped early on Thursday as Iran declared the critical energy chokepoint, the Strait of Hormuz, closed after the US launched additional strikes against the Middle East oil producer.
Brent futures rose $1.48 or 1.59 per cent to $94.58 per barrel, and the US West Texas Intermediate (WTI) crude climbed $1.71 or 1.90 per cent to $91.74 a barrel.
Iran’s top joint military command announced the closure of the Strait of Hormuz on Thursday, including oil tankers and commercial ships, saying any vessel attempting passage will be shot at.
Market analysts noted that the renewed escalation in fighting prompted oil prices to rally in early morning trading.
On Wednesday, the US military said on X that commercial ships continue to transit in and out of the strait. It also said no US warships have been struck in the strait, after Iran’s state media reported US ships near the waterway were targeted by missiles and drones.
US forces began launching additional strikes against multiple targets in Iran on Wednesday, the latest in an escalating exchange of attacks that threaten to reignite a full-scale war, which was paused in early April when the two sides agreed to a fragile ceasefire.
Defence Secretary Pete Hegseth held a press briefing announcing further attacks on Iran, saying, “If we need to negotiate with bombs, we’ll negotiate with bombs.” US Central Command later described those attacks as targeting “Iranian military surveillance capabilities, communication systems, and air defence sites across Iran.”
In response to the attacks, Iran’s top joint military command then announced that the Strait was closed to all shipping.
President Donald Trump said the strikes would stop shortly, but that they would continue if Iran’s leaders did not sign an agreement with the US immediately.
Iran’s months-long blockade of the strait, which normally carries a fifth of global oil and gas shipments, has kept oil prices elevated.
The latest exchange of strikes between the US and Iran marks the most significant escalation in the conflict since both countries agreed to a fragile ceasefire in April. Since then, oil inventories have drained dramatically, and no tangible breakthroughs have been announced.
Crude oil inventories in the US decreased by 7.2 million barrels during the week ending June 5, according to new data from the Energy Information Administration (EIA). The EIA’s data release follows figures that were released by the American Petroleum Institute (API) a day earlier, which reported that crude oil inventories saw a draw of 9.119 million barrels in the period.
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