By Adedapo Adesanya
The Nigerian Naira suffered a N1 or 0.17 per cent loss against the United States Dollar at the Peer-to-Peer (P2P) segment of the foreign exchange (FX) market on Thursday, closing at N587/$1 compared with the preceding day’s exchange rate of N586/$1.
This was caused by the strengthening of the greenback in the global market as the US Federal Reserve raised interest rates by 50 basis points, bringing the fed funds rate up from 0.5 per cent to 1 per cent.
This action by the Fed affected the cryptocurrency market yesterday as the bears had a field day, causing most of the cryptos tracked by Business Post across several trading platforms to lose value.
The US central bank’s policy-making committee said it will begin allowing its holdings of Treasuries and mortgage-backed securities to roll off in June.
Investors in digital coins reacted to this development and during the session, Cardano (ADA) plunged by 11.8 per cent to N476.51, Solana (SOL) recorded an 8.7 per cent depreciation to sell at N59,788.64, Litecoin (LTC) declined by 8.5 per cent to trade at N58,404.09, while Bitcoin (BTC) crashed by 8.4 per cent to N22,712,397.00.
In addition, Ripple (XRP) fell by 7.9 per cent to N359.71, Dash (DASH) slumped by 7.7 per cent to sell at N62,072.01, Ethereum (ETH) depreciated by 6.5 per cent to quote at N1,654,083, Binance Coin (BNB) recorded a 5.3 per cent slide to trade at N228,079.00, while Dogecoin (DOGE) dropped 5.1 per cent to exchange at N77.52.
But the United States Dollar Tether (USDT) appreciated on Thursday by 0.1 per cent to N648.01.
Meanwhile, a look at the performance of the Naira against the American currency at the Investors and Exporters (I&E) window of the forex market yesterday showed that it was woeful as it lost N1 or 0.24 per cent to close at N419.00/$1 compared with N418.00/$1 it ended on Wednesday.
Data from the FMDQ Securities Exchange indicated that the local currency reported the loss despite a decline in the day’s FX turnover by $54.46 or 33.5 per cent to $108.24 million from $162.70 million. A shortage of FX supply to traders may have been responsible for the weakening of the Naira during the session.
However, it was a different outcome at the interbank segment of the market, where the domestic currency appreciated against the Pound Sterling on Thursday by N4.03 to trade at N515.95/£1 compared to the previously traded rate of N519.98/£1.
But the Naira suffered a N1.36 loss against the Euro at the same market segment to wrap the day at 439.22/€1 in comparison to the preceding session’s N437.86/€1.
NASD OTC Market Closes Flat in Midweek Session
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange remained unchanged at the close of business on Wednesday, December 7, with the performance indicators closing flat.
Business Post reports that there was neither a price gainer nor a price loser at the midweek trading session, and this left the market capitalisation of the alternative bourse unchanged at N935.79 billion, as the NASD Unlisted Securities Index (NSI) also closed flat at 712.16 points.
However, the activity chart witnessed a downward movement during the session as the volume of transactions declined by 94.5 per cent due to the 56,370 units of securities traded by investors, in contrast to the 1.03 million units of securities transacted a day earlier.
Similarly, the value of shares exchanged by the market participants went down by 95.8 per cent yesterday as a result of the N1.3 million worth of stocks traded compared with the N31.0 million worth of stocks traded on Tuesday.
However, the number of deals carried out by traders increased by 30 per cent due to the 13 deals completed by investors as against the 10 deals executed in the preceding market day.
When trading activities ended for the day, AG Mortgage Bank Plc maintained its position as the most active stock by volume on a year-to-date basis with a turnover of 2.3 billion units valued at N1.2 billion, Central Securities Clearing System (CSCS) Plc stood in second place with the sale of 687.9 million units worth N14.3 billion, while Lighthouse Financial Services Plc was in third place with a turnover of 224.7 million units valued at N112.3 million.
Also, CSCS Plc retained its spot as the busiest stock by value on a year-to-date basis with the sale of 687.9 million units worth N14.3 billion, followed by VFD Group Plc with the sale of 29.1 million units valued at N7.7 billion, and FrieslandCampina WAMCO Nigeria Plc with a turnover of 17.6 million units worth N1.9 billion.
NGX Spurs Capital Market Innovation to Attract Investors
By Aduragbemi Omiyale
The Nigerian Exchange (NGX) Limited has disclosed that the NGX Made of Africa Awards will spur the next phase of capital market innovation to attract more investors into the space.
On Tuesday, December 6, 2022, the exchange held the award ceremony in Lagos to recognise innovativeness and compliance with best practices in the Nigerian capital market for the calendar year.
The event spotlighted excellence, creativity and integrity as NGX sought to amplify the activities of its stakeholders to further reinforce the values that attract investors to the market and grow the African economy.
Players in the capital market ranging from issuers, securities dealers, issuing houses, fund managers, trustees, legal firms and stakeholders, including the media and content creators were rewarded for their contributions to the development of the market.
In his opening remarks, the Chairman of NGX, Mr Abubakar Balarabe Mahmoud, explained that the goal of the exchange with the awards is to further catalyse innovation, corporate performance, shareholder return, compliance to rules and regulation in driving investor confidence and aiding regulatory oversight on the market.
“It is essential that we continue to collaborate, encourage and incentivise our partners through initiatives like the NGX Made of Africa Awards. At NGX, relationships, partnerships, collaboration and inclusivity continue to drive our actions in the quest to spotlight The Stock Africa is Made Of,” he said.
On his part, the chief executive of the bourse, Mr Temi Popoola, said the event had been reviewed to reflect the dynamism of the capital market and the transformation it had witnessed so far.
“We are delighted to be extending the reach of these Awards to further highlight our commitment to inclusivity, innovation and integrity whilst highlighting NGX as the platform of choice to raise capital,” he stated.
In his goodwill message, the Governor of Edo State, Mr Godwin Obaseki, highlighted the importance of the capital market to the economy, calling together all stakeholders to move Nigeria towards a more productive economy and less import-dependent.
He also noted that NGX has continued to stand out as a market infrastructure of choice for public and private sector capital formation.
Also, the Director-General of the Securities and Exchange Commission (SEC), Mr Lamido Yuguda, represented by the Executive Commissioner, Corporate Services, Mr Ibrahim Boyi, said that the commission had championed innovative measures that have improved the market, including dematerialisation, direct cash settlement and e-dividend.
“The long-term sustainability in the market requires innovation of which the fundamental outcome was a maximum return on investment, reduction in the cost of doing business and increased production,” he said.
Speaking on the African capital market potentials, Mr Aigboje Aig-Imokuede, the Chairman of Coronation Capital and a former President of the Council of the Nigerian Stock Exchange pre-demutualisation, said that after a long haul of liquidity in global markets, central banks across the globe are implementing hawkish monetary policies to revive price stability and tame inflationary pressures.
He noted that the capital market in this period of restrained global growth had an important role to play in stimulating economic growth and development through the efficient allocation of resources.
Business Post reports that a few of the awardees were Dangote Cement as Best Issuer in Terms of Number of Fixed Income Listings; Lafarge Africa as Leader in Sustainability Reporting; Pilot Securities Limited as Most Compliant Trading License Holder; Aluko and Oyebode as Best Solicitor in terms of Value of Deals; and Coronation Securities Limited as Best Sponsoring Trading License Holder of the Year. Lagos State won the State with the Largest Sub-national Debt Instrument; MTN Nigeria Communications won the Most Compliant Listed Company; CardinalStone Securities won the Best Trading License Holder Across Asset Classes; BUA Foods was awarded the Listing of the Year; and Capital Markets Correspondent Association (CAMCAN) won Capital Market Reportage.
Crude Oil Prices Fall To Lowest Levels in 10 Months
By Adedapo Adesanya
The prices of the crude oil grades in the market fell to their lowest levels this year on Wednesday, losing all of the gains they had accumulated since Russia’s invasion of Ukraine.
Brent futures fell by $2.18 or 2.8 per cent to trade at $77.17 a barrel, as the United States West Texas Intermediate (WTI) futures depreciated by $2.24 to $72.01 per barrel.
Oil surged to nearly $140 a barrel in March, close to an all-time record, following the launch of what Russia tagged a “special operation” in Ukraine a month earlier.
The market has been steadily declining recently as economists brace for weakened worldwide growth in part due to high energy costs.
The situation worsened on Wednesday with bigger-than-expected increases in US fuel inventories despite a drop in crude stocks.
The US Energy Information Administration (EIA) reported an inventory decline of 5.2 million barrels for the week of December 2 compared with a sizeable draw of 12.6 million barrels estimated for the previous week, which sent prices higher at the time.
A day before the EIA released its report, the American Petroleum Institute estimated another weekly crude inventory draw for the week to December 2 at 6.43 million barrels.
Meanwhile, the EIA also reported an inventory build in fuel and another rise in middle distillate stocks for the week to December 2. Gasoline (petrol) inventories added 5.3 barrels in the week to December 2, with production averaging 9.1 million barrels daily, in contrast to a build of 2.8 million barrels for the previous week and a production rate of 9.4 million barrels daily.
Prices are also slipping further down as traders relax about the potential consequences of the G7 and EU price cap on Russian oil.
It appears they have assumed that it would not affect the availability of oil in any significant way and are selling crude.
Analysts also note that Russian oil is already trading close to the cap, so it shouldn’t make much of a difference in revenues, but it is worth remembering Russia has said it would not sell oil to countries that enforce the price cap, meaning the supply of Russian oil specifically might tighten for some importers.
Russia has also threatened to set a price floor for its oil in response to the G7 price cap, which may further complicate matters.
Support came as China, the world’s biggest crude importer, announced the most sweeping changes to its anti-COVID regime since the pandemic began. The country’s crude oil imports in November rose 12 per cent from a year earlier to their highest in 10 months, data showed.
Still, warnings from big US banks about a likely recession next year weighed on the value of the commodity.
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