Economy

Bargain Hunting May Contribute to Rebound of US Equities

Published

6 years ago

21/11/2018

By Investors Hub

The major U.S. index futures are pointing to a higher opening on Wednesday, with stocks likely to regain ground following the steep drop seen over the course of the two previous sessions.

Bargain hunting may contribute to initial strength on Wall Street as traders look to pick up stocks at reduced levels following the sell-off seen early this week.

Upbeat earnings news from companies like Foot Locker (FL), BJ?s Wholesale (BJ), and Autodesk (ADSK) may also contribute to the rebound.

Buying interest may be somewhat subdued, however, as the Commerce Department recently released a report showing a much steeper than expected drop in durable goods orders in October.

Traders may also look to get a head start on the Thanksgiving Day holiday on Thursday, leading to below average trading activity.

Following the sell-off seen on Monday, stocks showed another significant move to the downside during trading on Tuesday. With the continued drop, the tech-heavy Nasdaq fell to its lowest closing level in over seven months.

The major averages ended the session off their worst levels of the day but still sharply lower. The Dow plunged 551.80 points or 2.2 percent to 24,465.64, the Nasdaq tumbled 119.65 points or 1.7 percent to 6,908.82 and the S&P 500 slumped 48.84 points or 1.8 percent to 2,641.89.

The continued weakness on Wall Street partly reflected a negative reaction to the latest batch of earnings news from companies such as Target (TGT).

Shares of Target plummeted by 10.5 percent after the retail giant reported third quarter earnings that missed analyst estimates on slightly weaker than expected comparable store sales growth.

Department store operator Kohl’s (KSS) and Victoria’s Secret parent L Brands (LB) also posted steep losses after reporting their quarterly results.

A continued decline by Apple (AAPL) also weighed on the markets, with the tech giant tumbling by 4.8 percent to a six-month closing low.

On the U.S. economic front, a report from the Commerce Department showed housing starts rebounded in the month of October, although the report also showed a decrease in building permits.

The Commerce Department said housing starts jumped by 1.5 percent to an annual rate of 1.228 million in October after plunging by 5.5 percent to a revised rate of 1.210 million in September.

Economists had expected housing starts to climb to a rate of 1.225 million from the 1.201 million originally reported for the previous month.

Meanwhile, the report said building permits fell by 0.6 percent to an annual rate of 1.263 million in October after surging up by 1.7 percent to an upwardly revised 1.270 million in September.

Building permits, an indicator of future housing demand, had been expected to increase to 1.267 million from the 1.241 million originally reported for the previous month.

Energy stocks showed a substantial move to the downside on the day amid a steep drop by the price of crude oil.

Reflecting the weakness in the energy sector, the Philadelphia Oil Service Index plummeted by 5.7 percent, while the NYSE Arca Natural Gas Index and the NYSE Arca Oil Index plunged by 3.9 percent and 3.3 percent, respectively.

Considerable weakness was also visible among steel stocks, as reflected by the 3.9 percent nosedive by the NYSE Arca Steel Index. The steep drop reflected concerns about the outlook for global demand.

Transportation, retail, telecom and financial stocks also saw significant weakness, reflecting another broad based sell-off on Wall Street.

Economy

NASD OTC Securities Exchange Closes Flat

Published

4 hours ago

13/12/2024

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange closed flat on Thursday, December 12 after it ended the trading session with no single price gainer or loser.

As a result, the market capitalisation remained unchanged at N1.055 trillion as the NASD Unlisted Security Index (NSI) followed the same route, remaining at 3,012.50 points like the previous trading session.

However, the activity chart witnessed changes as the volume of securities traded at the bourse went down by 92.5 per cent to 447,905 units from the 5.9 million units transacted a day earlier.

In the same vein, the value of securities bought and sold by investors declined by 86.6 per cent to N3.02 million from the N22.5 million recorded in the preceding trading day.

But the number of deals carried out during the session remained unchanged at 21 deals, according to data obtained by Business Post.

When trading activities ended for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units sold for N3.9 billion, Okitipupa Plc came next with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc was in third place with 297.5 million units worth N5.3 million.

Also, Aradel Holdings Plc remained the most active stock by value (year-to-date) with 108.7 million units worth N89.2 billion, followed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units sold for N5.3 billion.

Economy

Naira Firms to N1,534/$1 at NAFEM, Crashes to N1,680/$1 at Black Market

Published

4 hours ago

13/12/2024

Adedapo Adesanya

By Adedapo Adesanya

The Naira appreciated against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N14.79 or 0.9 per cent to trade at N1,534.50/$1 compared with the preceding day’s N1,549.29/$1 on Thursday, December 12.

The strengthening of the domestic currency during the trading session was influenced by the introduction of the Electronic Foreign Exchange Matching System (EFEMS) by the Central Bank of Nigeria (CBN).

The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.

The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN; publication of real-time prices and buy-sell orders data from this system has lent support to the Naira at the official market.

Equally, the local currency improved its value against the British Pound Sterling by N3.91 to wrap the session at N1,954.77/£1 compared with the previous day’s N1,958.65/£1 and against the Euro, the Nigerian currency gained N2.25 to sell for N1,610.41/€1 versus N1,612.66/€1.

However, in the black market, the Naira crashed further against the US Dollar on Thursday by N10 to quote at N1,680/$1 compared with Wednesday’s closing rate of N1,670/$1.

Meanwhile, the cryptocurrency market majorly corrected after earlier gains as US President-elect Donald Trump reiterated his ambition to embrace crypto assets, but a bond market rout dragged risk assets lower.

Mr Trump said, “We’re going to do something great with crypto” while ringing the opening bell at the New York Stock Exchange, reiterating his ambition to embrace digital assets in the world’s largest economy and create a strategic bitcoin reserve.

Alongside, the European Central Bank trimmed its benchmark interest rates by 25 basis points and in its dovish policy statement hinted that more rate cuts were likely to happen.

The biggest loss was made by Cardano (ADA), which fell by 4.9 per cent to trade at $1.10, followed by Ripple (XRP), which slid by 4.1 per cent to $2.33 and Dogecoin (DOGE) recorded a value depreciation of 2.9 per cent to sell at $0.4064.

Further, Solana (SOL) slumped by 1.8 per cent to $225.89, Binance Coin (BNB) slipped by 1.3 per cent to $746.92, Bitcoin (BTC) declined by 0.6 per cent to $99,998.18, Ethereum (ETH) crumbled by 0.5 per cent to $3,909.43, and Litecoin (LTC) dipped by 0.3 per cent to $121.52, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.

Economy

Oil Market Falls on Expected Increase in Supply Surplus

Published

6 hours ago

13/12/2024

Adedapo Adesanya

By Adedapo Adesanya

The oil market slumped on Thursday, pressured by an expected increase in supply, supported by rising expectations of a Federal Reserve interest rate cut.

The International Energy Agency (EIA) made a slight upward revision to its demand outlook for next year but still expected the oil market to be comfortably supplied, with Brent crude futures losing 11 cents or 0.15 per cent to trade at $73.41 per barrel and the US West Texas Intermediate (WTI) crude futures declining by 27 cents or 0.38 per cent to finish at $70.02 per barrel.

The IEA in its monthly oil market report increased its 2025 global oil demand growth forecast to 1.1 million barrels per day from 990,000 barrels per day last month, largely in Asian countries due to the impact of China’s recent stimulus measures.

At the same time, the IEA expects nations not in the Organisation of the Petroleum Exporting Countries and Allies (OPEC+) group to boost supply by about 1.5 million barrels per day next year, driven by the US, Canada, Guyana, Brazil and Argentina – more than the rate of demand growth.

On Wednesday, OPEC cut its demand growth forecast for 2024 for the fifth straight month.

The IEA said that, even excluding the return to higher output quotas, its current outlook is to a 950,000 barrels per day supply overhang next year, which is almost 1 per cent of the world’s supply.

The Paris-based agency said this would rise to 1.4 million barrels per day if OPEC+ goes ahead with its plan to start unwinding cuts from the end of next March.

Next year’s surplus could make it harder for OPEC+ to bring back production. The hike was earlier due to start in October 2024, but OPEC+ has delayed it amid falling prices.

Meanwhile, inflation rose slightly in November increasing the possibility of a US Federal Reserve rates cut again as the data fed optimism about economic growth and energy demand.

Support also came as crude imports in China grew annually for the first time in seven months in November, up more than 14 per cent from a year earlier.