Economy
Rising Tensions in Hong Kong May Lead to Pullback on Wall Street
By Investors Hub
The major U.S. index futures are currently pointing to a lower opening on Friday, with stocks likely to move back to the downside after trending higher in recent sessions.
Rising tensions in Hong Kong may weigh on Wall Street amid concerns widespread protests could impact the ability of the U.S. and China to reach a phase on trade deal.
Traders may also look to take some profits after the upward trend see over the past several sessions lifted the major averages to new record highs.
However, the markets have recently shown a resistance to giving back much ground, with traders seemingly concerned about missing out on further upside.
Overall trading activity is likely to remain subdued, as some traders to the sidelines following the holiday on Thursday.
A lack of major U.S. economic news may also contribute to light trading activity along with the early close for the markets.
Extending the upward trend seen over the past few sessions, stocks moved mostly higher over the course of the trading day on Wednesday. Buying interest was somewhat subdued, but the major averages still managed to reach new record closing highs.
The major averages all closed in positive territory, with the Nasdaq and the S&P 500 just off their highs of the session. The Dow rose 42.32 points or 0.2 percent to 28,164.00, the Nasdaq advanced 57.24 points or 0.7 percent to 8,705.18 and the S&P 500 climbed 13.11 points or 0.4 percent to 3,153.63.
The markets continued to benefit from optimism about a potential U.S.-China trade deal after President Donald Trump said trade talks are “going very well.”
“We’re in the final throes of a very important deal ? I guess you could say, one of the most important deals in trade ever,” Trump told reporters at the White House on Tuesday.
The continued strength on Wall Street also came following the release of some upbeat U.S. economic data, including a Commerce Department report showing durable goods orders unexpectedly rebounded in the month of October.
The Commerce Department said durable goods orders climbed by 0.6 percent in October after plunging by a revised 1.4 percent in September.
Economists had expected durable goods orders to decrease by 0.8 percent compared to the 1.2 percent slump that had been reported for the previous month.
Separately, revised data released by the Commerce Department showed the U.S. economy grew by more than initially estimated in the third quarter.
The Commerce Department said real gross domestic product jumped by 2.1 percent in the third quarter compared to the previously estimated 1.9 percent increase. Economists had expected the pace of GDP growth to be unrevised.
The stronger than previous estimated growth reflected upward revisions to private inventory investment, non-residential fixed investment, and consumer spending.
Meanwhile, the National Association of Realtors released a report unexpectedly showing a sharp pullback in U.S. pending home sales in the month of October.
NAR said its pending home sales index plunged by 1.7 percent to 106.7 in October after surging up by 1.4 percent to a revised 108.6 in September.
Economists had expected pending home sales to climb by 0.8 percent compared to the 1.5 percent jump originally reported for the previous month.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
The Commerce Department also released a separate report showing U.S. personal income came in nearly flat in the month of October, although personal spending rose in line with economist estimates.
Late in the trading day, the Federal Reserve released its Beige Book, which said U.S. economic activity expanded modestly from October through mid-November.
The Beige Book, a compilation of anecdotal evidence on economic conditions in the twelve Fed districts, noted economic growth continued at a similar pace to the prior reporting period.
Trading activity was relatively light, however, as some traders looked to get a head start on the Thanksgiving Day holiday on Thursday.
Oil service stocks moved sharply higher over the course of the trading session, driving the Philadelphia Oil Service Index up by 2 percent. The strength among oil service stocks came despite a decrease by the price of crude oil.
Significant strength was also visible among tobacco stocks, with the NYSE Arca Tobacco Index climbing by 1.2 percent to its best closing level in over two months.
Natural gas and biotechnology stocks also saw considerable strength on the day, while most of the other major sectors showed more modest moves.
By Aduragbemi Omiyale
On Tuesday, December 17, 2024, President Bola Tinubu will present the 2025 budget to a joint session of the National Assembly.
The size of the 2025 Appropriation Bill is about N47.9 trillion and would be presented to the parliament for approval.
Speaking at the plenary on Thursday, December 12, 2024, the President of the Senate, Mr Godswill Akpabio, said the presentation by Mr Tinubu would be at the chamber of the House of Representatives.
However, it is not certain if the lawmakers will pass the budget before December 31 to allow for a recent budget cycle of January to December.
Recall that on December 3, the senate approved the Medium Term Expenditure Framework and Fiscal Strategy Paper (MTEF/FSP) for 2025 to 2027.
This was after the President presented this the National Assembly on November 19 ahead of the consideration of the 2025 budget proposal.
In the MTEF/FSP, the government said it planned to borrow about N9.22 trillion from local and foreign sources to finance the budget deficit.
It pegged the crude oil benchmark at $75 per barrel and a daily oil production of 2.06 million barrels at an exchange rate of N1,400 to $1, and a targeted gross domestic product (GDP) growth rate of 6.4 percent.
At the plenary today, Mr Akpabio informed his colleagues that, “The President has made his intention known to the National Assembly to present the 2025 budget to the joint session of the National Assembly on December 17, 2024.”
By Adedapo Adesanya
Nigeria added 150,000 barrels per day to its crude production in November 2024 as it continues to pursue an ambitious 2 million barrels per day target.
According to the Organisation of the Petroleum Exporting Countries (OPEC), Nigeria’s oil production rose to 1.48 million barrels per day in November, up from 1.33 million barrels per day the previous month.
In its Monthly Oil Market Report (MOMR), OPEC revealed that at 1.48 million barrels per day, it is the continent’s leading oil producer, surpassing Algeria’s 908,000 barrels per day and Congo’s 268,000 barrels per day.
Business Post reports that OPEC doesn’t account for condensates, which Nigeria’s accounts for in its broader 2 million barrels per day target.
Despite the surge in production levels, Nigeria is still under producing its 1.5 million barrels per day output quota under a deal involving OPEC and 10 other producers known as OPEC+.
OPEC said it relied on primary data gotten through direct communication, noting that secondary sources reported 1.417 million barrels per day as Nigeria’s crude production in November — up from 1.4 million barrels per day in October.
The data also shows that OPEC’s total oil production among its 12 members rose by 104,000 barrels per day in the month under review.
According to secondary sources, the total of the 12 OPEC countries’ crude oil production averaged 26.66 million barrels per day in November 2024.
“Crude oil output increased mainly in Libya, Iran, and Nigeria, while production in Iraq, Venezuela, and Kuwait decreased”, OPEC said.
“At the same time, total non-OPEC DoC crude oil production averaged 14.01 mb/d in November 2024, which is 219 tb/d higher, m-o-m. Crude oil output increased mainly in Kazakhstan and Malaysia,” the organisation added.
In a related development, OPEC trimmed its 2024 and 2025 oil demand growth forecasts for the fifth time this year.
Now, the cartel expects the world’s oil demand growth at 1.61 million barrels per day from the previously 1.82 million barrels per day.
For 2025, OPEC says the world oil demand growth forecast is now at 1.45 million barrels per day, a 900,000 barrels per day cut from the previously expected 1.54 million barrels per day.
On the changes, OPEC says that the downgrade for this year owes to more bearish data received in the third quarter of 2024 while the projections for next year relate to the potential impact that will arise from US tariffs.
By Adedapo Adesanya
The duo of Afriland Properties Plc and Geo-Fluids Plc crashed the NASD Over-the-Counter (OTC) Securities Exchange by a marginal 0.06 per cent on Wednesday, December 11 due to profit-taking activities.
The OTC securities exchange experienced a downfall at midweek despite UBN Property Plc posting a price appreciation of 17 Kobo to close at N1.96 per share, in contrast to Tuesday’s closing price of N1.79.
Business Post reports that Afriland Properties Plc slid by N1.14 to finish at N15.80 per unit versus the preceding day’s N16.94 per unit, and Geo-Fluids Plc declined by 1 Kobo to trade at N3.92 per share compared with the N3.93 it ended a day earlier.
At the close of transactions, the market capitalisation of the bourse, which measures the total value of securities on the platform, shrank by N650 million to finish at N1.055 trillion compared with the previous day’s N1.056 trillion and the NASD Unlisted Security Index (NSI) went down by 1.86 points to wrap the session at 3,012.50 points compared with 3,014.36 points recorded in the previous session.
The alternative stock market was busy yesterday as the volume of securities traded by investors soared by 146.9 per cent to 5.9 million units from 2.4 million units, as the value of shares transacted by the market participants jumped by 360.9 per cent to N22.5 million from N4.9 million, and the number of deals increased by 50 per cent to 21 deals from 14 deals.
When the bourse closed for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, followed by Okitipupa Plc with 752.2 million units worth N7.8 billion, and Afriland Properties Plc 297.5 million units sold for N5.3 million.
Also, Aradel Holdings Plc, which is now listed on the Nigerian Exchange (NGX) Limited after its exit from NASD, remained the most active stock by value (year-to-date) with 108.7 million units sold for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units worth N5.3 billion.
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