Economy
Asian Stock Markets Rise as China Cuts Interest Rate
By Investors Hub
Asian stock markets ended mostly higher on Monday as investors awaited further progress on a U.S.-China trade deal, while China’s central bank surprised markets by cutting a key interest rate for the first time since 2015.
On Saturday, Chinese state media said that the U.S. and China had ?constructive discussions? regarding a phase one trade deal in a high-level phone call.
Chinese shares closed higher after the People’s Bank of China unexpectedly lowered the rate on seven-day reverse repurchase agreements by five basis points to 2.50 percent. The move stoked hopes of more stimulus measures to revive the slowing economy.
The benchmark Shanghai Composite Index added 17.86 points or 0.6 percent to finish at 2,909.20. Hong Kong shares closed notably higher, after suffering hefty losses last week. The Hang Seng Index advanced 293.05 points or 1.1 percent to close at 26,619.71.
Japanese stocks also rose in choppy trading as investors awaited further progress on a potential U.S.-China trade deal. Tech stocks were among the major gainers. The benchmark Nikkei 225 Index climbed 113.44 points or 0.5 percent to close at 23,416.76.
In the tech space, Advantest gained 3.7 percent and Tokyo Electron rose 1.8 percent. Market heavyweight SoftBank Group and South Korean internet giant Naver said they have reached a basic agreement on a merger by October 2020 of Z Holdings, formerly known as Yahoo Japan, and the Line chat app.
Shares of Z Holdings rose 1.2 percent. SoftBank Group advanced 1.6 percent, while Fast Retailing added 0.6 percent.
The major exporters closed mixed despite a weaker yen. Sony rose 1.8 percent and Canon added 0.5 percent, while Mitsubishi Electric declined 1 percent and Panasonic lost 0.8 percent.
Among the other major gainers, Eisai Co. rose 4.4 percent, while Recruit Holdings and Hitachi Zosen advanced 2.2 percent each.
On the flip side, DIC Corp. lost 4.1 percent, Nippon Suisan Kaisha dipped 3.4 percent and Toray Industries declined 3.3 percent.
The Australian market closed lower as investors awaited further progress on a potential U.S.-China trade deal. Banking, telecom and utility stocks were among the major losers.
The benchmark S&P/ASX 200 Index fell 26.90 points or 0.4 percent to close at 6,766.80, while the broader All Ordinaries Index lost 27.20 points or 0.4 percent to finish at 6,871.70.
In the banking space, ANZ Banking, Westpac, Commonwealth Bank and National Australia Bank fell in a range of 0.2 percent to 0.8 percent ahead of the release of the minutes of the Reserve Bank of Australia’s November meeting on Tuesday.
National Australia Bank is seeking to raise A$1.4 billion through the issue of medium-term notes to bolster its capital ahead of a regulatory deadline.
Among gold miners, Evolution Mining lost 2.3 percent and Newcrest Mining declined 0.9 percent.
Saracen Mineral Holdings has agreed to acquire a 50 percent stake in Kalgoorlie’s Super Pit from Canada’s Barrick Gold for $750 million. The company’s shares were in a trading halt for a capital raising.
Smartgroup Corp. fell 13.7 percent after the salary packaging company said its long-term chief executive would retire in early 2020.
Among the major miners, Rio Tinto advanced 0.9 percent and BHP added 0.2 percent, while Fortescue Metals edged down 0.1 percent.
oOh!Media rejected rumors it has hired Macquarie Capital to help find a private equity firm to back a management buyout and delist from the ASX. Shares of the outdoor advertiser dipped 1.7 percent after emerging from a trading halt.
Appen raised its earnings outlook for the full year and also reiterated a lowered outlook for annual recurring revenue from its Figure Eight machine learning software. The tech company’s shares rose 13.4 percent.
Seoul stocks edged lower as investors booked profits. The benchmark Kospi declined 1.49 points or 0.1 percent to settle at 2,160.69. Market heavyweight Samsung Electronics dipped 0.4 percent, while chipmaker SK hynix added 0.4 percent.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange closed higher by 1.41 per cent on Friday, May 15, supported by four securities on the platform.
During the session, FrieslandCampina Wamco Plc added N14.24 to its share price to sell for N159.00 per unit, in contrast to the previous day’s N144.76 per unit.
Further, Central Securities and Clearing System (CSCS) Plc appreciated by N1.34 to N72.34 per share from N71.00 per share, Geo-Fluids Plc improved its price by 4 Kobo to N2.94 per unit from N2.90 per unit, and Industrial and General Insurance (IGI) Plc gained 1 Kobo to trade at 61 Kobo per share compared with Thursday’s closing price of 60 Kobo per share.
As a result, the NASD Unlisted Security Index (NSI) rose by 58.20 points to 4,188.41 points from 4,130.21 points, and the market capitalisation soared by N34.82 billion to N2.506 trillion from N2.471 trillion on Thursday.
During the session, the volume of trades went up by 180.8 per cent to 1.2 million units from 417,349 units, and the value of transactions increased by 29.8 per cent to N29.8 million from N23.2 million, while the number of deals fell by 22.6 per cent to 24 deals from 31 deals.
Great Nigeria Insurance (GNI) Plc ended the day as the most traded stock by value on a year-to-date basis with 3.4 billion units sold for N8.4 billion, followed by CSCS Plc with 60.8 million units exchanged for N4.1 billion, and Okitipupa Plc with 27.9 million units valued at N1.9 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 worth N8.4 billion, followed by Resourcery Plc with 1.1 billion units transacted for N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units traded for N1.2 billion.
By Dipo Olowookere
The bears overpowered the Nigerian Exchange (NGX) Limited on Friday, sinking it further by 0.76 per cent when the closing gong was struck by 4 pm.
The nation’s flagship equity market was under selling pressure during the session, as investors booked profits after the shares witnessed price appreciation in the past trading sessions.
The energy sector was the most impacted, as it shed 4.43 per cent. The consumer goods index declined by 0.90 per cent, the banking counter decreased by 0.15 per cent, and the industrial goods sector lost 0.08 per cent, while the insurance counter gained 2.42 per cent, which was not enough to salvage the situation.
Consequently, the All-Share Index (ASI) contracted by 1,912.19 points to 250,330.92 points from 252,243.11 points, and the market capitalisation moderated by 1.225 trillion to N160.444 trillion from N161.669 trillion.
Zichis was the worst-performing stock for the session after it gave up 9.97 per cent to close at N29.43, FTN Cocoa slipped by 9.95 per cent to N8.96, The Initiates slumped by 9.90 per cent to N32.30, LivingTrust Mortgage Bank tumbled by 9.88 per cent to N3.83, and International Energy Insurance dropped 9.71 per cent to trade at N2.79.
The best-performing stock was ABC Transport, which grew by 10.00 per cent to N6.27. May and Baker also appreciated by 10.00 per cent to N47.30, SCOA Nigeria surged by 9.98 per cent to N33.05, Trans-Nationwide Express expanded by 9.97 per cent to N7.06, and DAAR Communications jumped 9.76 per cent to N2.25.
Yesterday, investors traded 1.1 billion shares worth N44.3 billion in 65,744 deals compared with the 1.0 billion shares valued at N41.6 billion transacted in 74,822 deals a day earlier. This indicated a dip in the number of deals by 12.13 per cent, and a rise in the trading volume and value by 10.00 per cent and 6.49 per cent, respectively.
Chams was the busiest equity for the day, with 328.5 million units sold for N1.1 billion. UBA traded 61.6 million units worth N2.7 billion, First Holdco transacted 58.7 million units valued at N4.2 billion, Secure Electronic Technology exchanged 51.9 million units worth N45.0 million, and Access Holdings traded 51.8 million units valued at N1.3 billion.
By Adedapo Adesanya
The last trading session of the week at the Nigerian Autonomous Foreign Exchange Market (NAFEX) ended on a negative note for the Naira on Friday, May 15, as it lost N15 Kobo or 0.1 per cent against the Dollar to trade at N1,371.04/$1 compared with the previous day’s N1,370.89/$1.
However, it further appreciated against the Pound Sterling in the same market segment yesterday by N20.77 to close at N1,830.61/£1 versus Thursday’s value of N1,851.38/£1, and gained N7.91 against the Euro to settle at N1,595.07/€1 versus N1,602.98/€1.
At the GTBank FX desk, the Naira lost N2 against the US Dollar during the session to sell at N1,383/$1 compared with the preceding session’s N1,381/$1, and at the black market, it remained unchanged at N1,385/$1.
The Naira is forecast to be broadly stable, supported by Dollar sales by the Central Bank of Nigeria (CBN) amid steady, higher oil receipts, with the market settling into a balance.
Policy direction is also expected to give the market some boost as the CBN said the new edition of the FX market guidelines will deepen liquidity, improve transparency and strengthen confidence in the country’s foreign exchange market.
According to the Governor of the CBN, Mr Yemi Cardoso, the update is due to changing global economic realities, domestic reforms and the need for a more coherent and forward-looking regulatory framework. According to him, the last edition of the FX manual was issued in 2018, making the latest review both timely and necessary.
Meanwhile, the cryptocurrency market plunged into the red zone as rising bond yields hit risk assets across markets, while traders are increasingly betting the Federal Reserve may need to raise rates again. Rising energy prices and resurging inflation could force central banks back into tightening mode.
Cardano (ADA) shrank by 4.4 per cent to $0.2557, Dogecoin (DOGE) slid by 3.7 per cent to $0.1104, Ripple (XRP) depreciated by 3.5 per cent to $1.41, Solana (SOL) crashed by 3.5 per cent to $87.81, and Binance Coin (BNB) slumped by 3.4 per cent to $659.64.
Further, Bitcoin (BTC) declined by 2.6 per cent to $78,547.49, Ethereum (ETH) lost 2.1 per cent to quote at $2,209.19, and TRON (TRX) tumbled by 0.7 per cent to $0.3509, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.
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