Economy

Disappointing Retail Sales Data May Weigh on Wall Street

Published

8 years ago

15/05/2017

By Investors Hub

The major US index futures are pointing to a mixed opening on Monday, as stocks appear poised to extend the lacklustre performance seen over the past several sessions.

A sharp increase by the price of crude oil may lead to strength among energy stocks after the Saudi Arabian and Russian energy ministers indicated an agreement to freeze oil output would be extended until March of 2018.

However, other stocks may come under pressure amid concerns about the impact of the WannaCry ransomware attack, which has reportedly affected 200,000 victims in 150 countries.

With traders shrugging off disappointing retail sales data, stocks turned in another relatively lackluster performance during trading on Friday. The choppy trading seen on the day extended a recent trend on Wall Street.

The major averages eventually ended the session on opposite sides of the unchanged line. The Nasdaq inched up 5.27 points or 0.1 percent to 6,121.23, but the Dow edged down 22.81 points or 0.1 percent to 20,896.61 and the S&P 500 slipped 3.54 points or 0.2 percent to 2,390.90.

Reflecting the lack of direction seen in recent sessions, the major averages also turned in a mixed performance for the week. While the Nasdaq rose by 0.3 percent, the Dow fell by 0.5 percent and the S&P 500 dipped by 0.3 percent.

The mixed close on Wall Street came following the release of a Commerce Department report showing a smaller than expected increase in retail sales in the month of April.

The Commerce Department said retail sales climbed by 0.4 percent in April compared to economist estimates for 0.6 percent growth.

However, the report also said retail sales inched up by a revised 0.1 percent in March versus the 0.2 percent drop originally reported.

Excluding a rebound in auto sales, retail sales rose by 0.3 percent in April, matching the increase seen in the previous month as well as economist estimates.

A separate report from the Labor Department showed that consumer prices rebounded in line with economist estimates in the month of April.

The Labor Department said its consumer price index rose by 0.2 percent in April after falling by 0.3 percent in March.

Excluding food and energy prices, core consumer prices inched up by 0.1 percent in April after dipping by 0.1 percent in March. Core prices had been expected to rise by 0.2 percent.

Meanwhile, the University of Michigan released a report showing a modest improvement in consumer sentiment in the month of May.

The report said the preliminary reading on the consumer sentiment index for May came in at 97.7 compared to the final April reading of 97.0. Economists had expected the index to inch up to 97.3.

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Oil service stocks saw substantial weakness, however, with the Philadelphia Oil Service Index slumping by 1.9 percent. Rowan (RDC), Diamond Offshore (DO), and Transocean (RIG) turned in some of the sector’s worst performances.

Considerable weakness was also visible among steel stocks, as reflected by the 1.2 percent drop by the NYSE Arca Steel Index. The index fell to its lowest closing level in six months.

On the other hand, biotechnology stocks showed a notable move to the upside on the day, driving the NYSE Arca Biotechnology Index up by 1.1 percent.

Gold stocks also moved higher along with the price of the precious metal, with the NYSE Arca Gold Bugs Index climbing by 1.1 percent.

Economy

Wale Edun Rules Out IMF Loan for Nigeria

Published

2 hours ago

24/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, has said Nigeria may not run to the International Monetary Fund (IMF) for any loan.

He disclosed this in a chat with Arise Television on the sidelines of the ongoing World Economic Forum (WEF) in Davos, Switzerland.

The Minister affirmed that Nigeria has no reason to approach the global lender, adding that the nation is currently relying on relatively cheaper borrowing sources from the World Bank and the African Development Bank (AfDB).

He also argued that Nigeria does not have a balance of payments problem and therefore will not need the short-term financing intervention by the Bretton Wood institution.

“I can imagine the headlines if you saw a situation whereby you were saying Nigeria approaches the IMF for funding. But the reality is that, of course, as a developing country, requiring investment, funds for the government, and investment in key infrastructure to improve the enabling environment for business, we do need funds, and we have the need to borrow.

“We have relied on relatively cheap funding from the multilateral, from the World Bank, from AFDB, and the whole spectrum of funding has been used.”

He also said that the country will tap a range of instruments to help finance this year’s budget deficit and improve the economy.

“We have relied on Nigerian savings by convincing them of the macroeconomic plan of the president, and what it holds in terms of the prospects for growth of the economy and business, and improvement of the business environment.

“Of course, we have approached the Euro bond market, which is, of course, the commercial end of financing. So we’ve done that whole spectrum. When it comes to IMF financing, typically financing from the IMF is to help with short-term balance of payments issues and crises.

“In the case of Nigeria, we have a positive trade balance. We have a positive current account balance. Our reserves are growing. The Governor of the Central Bank recently announced that we had achieved upwards of $10 billion improvement and increase in the reserves.

“We need to use equity. We need to rely on crowding in the savings, particularly of the private sector in Nigeria and the private sector around the world in the form of foreign direct investment. We have to remember that at this time, we have had significant gains in terms of improving the economic environment,” Mr Edun stated.

Economy

NASD OTC Exchange Rises 0.33%

Published

9 hours ago

24/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange rose further by 0.33 per cent on Thursday, January 23, as appetite for unlisted stocks continued to grow.

During the trading session, the value of the bourse went up by N7.6 billion to N1.767 trillion from the N1.76 trillion it closed in the preceding session, as the NASD Unlisted Security Index (NSI) made an additional 10.33 points to wrap the trading day at 3,120.3 points compared with the 3,09.80 points recorded at the midweek session.

Business Post reports that the share price of Okitipupa Plc increased on Thursday by N4.35 to end the day at N47.90 per unit compared with the previous day’s N43.55 per unit, and Food Concepts Plc gained 14 Kobo to settle at N1.74 per share, in contrast to the preceding day’s N1.60 per share.

On the flip side, Impresit Bakolori Plc suffered a decline of 10 Kobo yesterday to trade at 95 Kobo per unit versus Wednesday’s closing price of N1.05 per unit.

When the exchange closed for the session, the volume of securities bought and sold by investors went up by 70,008 per cent to 407.4 million units from the 581,160 units transacted a day earlier.

Equally, the value of shares traded during the session jumped by 16,665.9 per cent to N391.2 million from the N2.3 million recorded at midweek, and the number of deals increased by 65 per cent to 30 deals from the 20 deals posted on Wednesday.

Impresit Bakolori Plc topped the activity chart as the most active stock by value (year-to-date) with 406.5 million units worth N386.1 million, followed by FrieslandCampina Wamco Nigeria Plc with 4.3 million units valued at N170.4 million, and Geo-Fluids Plc with 9.1 million units sold for N44.3 million.

However, Impresit Bakolori Plc snatched the top spot as most active stock by volume (year-to-date) with 406.5 million units worth N386.1 million, as Industrial and General Insurance (IGI) Plc dropped to second position for selling 26.3 million units sold for N6.3 million, and Geo-Fluids Plc occupied third with 9.2 million units valued at N44.3 million.

Economy

Naira Firms to N1,548/$1 at Official Market, Tumbles at Black Market

Published

10 hours ago

24/01/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira recovered about 0.26 per cent or N3.99 against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, January 23 after coming under pressure in recent times.

During the session, the exchange rate of the local currency to its American counterpart closed at N1,548.59/$1 in the official market compared with the previous day’s N1,552.58/$1.

Also, against the Pound Sterling, the domestic currency gained N3.32 yesterday to trade at N1,912.21/£1 compared with Wednesday’s value of N1,915.53/£1 and on the Euro, it improved by N3.82 to sell for N1,617.72/€1 versus N1,613.89/€1.

The forex market may be reacting positively to news that the Central Bank of Nigeria (CBN) would launch a FX Code, which will serve as a guideline to the banking industry to promote ethical conduct of Authorised Dealers in the Nigerian FX market, next week.

The code will further reduce speculative activities, eliminate market distortions, and give the CBN improved oversight capabilities to effectively regulate the market.

The bank noted that authorised dealers would subsequently conduct all FX transactions in the interbank FX market on the EFEMS approved by the apex bank where transactions will be reflected immediately.

However, in the black market segment, the Nigerian Naira lost N5 against the greenback during the session to quote at N1,665/$1, in contrast to midweek’s rate of N1,660/$1.

As for the cryptocurrency market, it was lively yesterday as attention is increasingly centered on potential policy developments under the government of President Donald Trump of the US.

On Thursday, President Trump signed an executive order to ban the digital dollar and promote crypto and AI innovation in the country.

Meanwhile, the US data released recently showed the “all tenant rent” index, which leads the shelter inflation in the Consumer Price Index (CPI), rose at a slower pace last quarter. That has raised hopes that the US Federal Reserve will walk back on its hawkish December rate forecasts.

These helped Ethereum (ETH) gain 5.4 per cent on Thursday to sell at $3,394.79, Solana (SOL) appreciated by 4.4 per cent to $260.86, Cardano (ADA) jumped by 2.9 per cent to $1.00, and Litecoin (LTC) expanded by 2.6 per cent to $116.78.

Further, Bitcoin (BTC) rose by 2.1 per cent to $1o4,978.31, Ripple (XRP) leapt by 0.7 per cent to $3.16, Dogecoin (DOGE) increased by 0.6 per cent to $0.3572, and Binance Coin (BNB) soared by 1.6 per cent to $710.31, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 each.