Economy
Futures Pointing to Pullback on Wall Street
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Tuesday following the strong upward move seen last week.
Profit taking may contribute to initial weakness on Wall Street, although trading activity may remain somewhat subdued ahead of the release of the minutes of the latest Federal Reserve meeting on Wednesday.
Stocks moved mostly higher in morning trading on Friday but turned mixed over the course of the session. The major averages eventually ended the day on opposite sides of the unchanged line.
While the Dow and the S&P 500 closed higher for sixth consecutive session, the tech-heavy Nasdaq dipped 16.96 points or 0.2 percent to 7,239.47. The Dow edged up 19.01 points or 0.1 percent to 25,219.38 and the S&P 500 inched up 1.02 points or less than a tenth of a percent to 2,732.22.
Despite the mixed performance on the day, the major averages all moved sharply higher for the week. The Nasdaq spiked by 5.3 percent, while the Dow and the S&P 500 both surged up by 4.3 percent.
The mixed close on Wall Street came after Special Counsel Robert Mueller’s office revealed that a federal grand jury has indicted several Russian nationals for allegedly interfering in the 2016 presidential election.
The indictment does not allege collusion between the Russians and President Donald Trump’s campaign but could still cause headaches for the president.
The strength seen earlier in the day came as traders once again shrugged off further indications of rising inflation, with a report from the Labor Department showing import prices jumped by more than expected in the month of January.
The Labor Department said import prices surged up by 1.0 percent in January after edging up by a revised 0.2 percent in December.
Economists had expected import prices to climb by 0.6 percent compared to the 0.1 percent uptick originally reported for the previous month.
The report also said export prices increased by 0.8 percent in January after inching up by a revised 0.1 percent in December.
Export prices had been expected to rise by 0.3 percent compared to the 0.1 percent drop originally reported for the previous month.
A separate report from the Commerce Department showed a much bigger than expected rebound in new residential construction in January.
The Commerce Department said housing starts soared by 9.7 percent to an annual rate of 1.326 million in January after tumbling by 6.9 percent to a revised 1.209 million in December.
Economists had expected housing starts to climb by 3.5 percent to an annual rate of 1.234 million from the 1.192 million originally reported for the previous month.
Building permits, an indicator of future housing demand, also surged up by 7.4 percent to an annual rate of 1.396 million in January from the revised December rate of 1.300 million.
The University of Michigan also released a report unexpectedly showing a significant improvement in consumer sentiment in the month of February.
The preliminary reading on the consumer sentiment index for February came in at 99.9, up from the final January reading of 95.7. Economists had expected the index to edge down to 95.5.
“Consumer sentiment rose in early February to its second highest level since 2004 despite lower and much more volatile stock prices,” said Richard Curtin, the survey’s chief economist.
Curtin said stock market gyrations were overshadowed by rising incomes, employment growth, and net favorable perceptions of tax reform.
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.
Pharmaceutical stocks saw considerable strength, however, with the NYSE Arca Pharmaceutical Index climbing by 1 percent.
Biopharmaceutical company Alkermes (ALKS) posted a standout gain, surging up by 5.5 percent to a two-year closing high.
On the other hand, substantial weakness was visible among gold stocks, as reflected by the 2.3 percent slump by the NYSE Arca Gold Bugs Index. Gold stocks came under pressure despite a modest increase by the price of the precious metal.
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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