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Nigerian Stocks Open Week Sluggish, Drop 0.40%

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Nigerian Stocks Open Week Sluggish, Drop 0.40%

Nigerian Stocks Open Week Sluggish, Drop 0.40%

By Modupe Gbadeyanka

Activities resumed for the week on the Nigerian Stock Exchange (NSE) on Monday on a bearish trend, leaving the market to decline by 0.40 percent.

The major market indices depreciated today, leaving the All-Share Index to fall by 101.38 points to close at 25,136.63 points and the market capitalisation to weaken by N35.1 billion to finish at N8.7 trillion.

There were a total of 12 gainers on the floor of the NSE on Monday, same with the total number of laggers.

Total, Guinness, UACN, GTBank and Ecobank were the top five gainers at the market today, while Mobil, Forte Oil, Dangote Cement, Stanbic IBTC and Oando led the losers’ chart.

While Total went up by N8 to close at N280 per share, Guinness appreciated by N1.97k to finish at N67.98k per share.

Also, UACN gained 54k to end at N13.74k per share, GTBank advanced by 50k to close at N25 per share and Ecobank rose by 47k to finish at N10.50k per share.

At the other end, Mobil depreciated by N5 to close at N280 per share, Forte Oil slumped by N2.58k to end at N49.9k per share and Dangote Cement crashed by N1 to close at N160 per share.

In the same vein, Stanboc IBTC dropped 29k to end at N18 per share, while Oando sank by 8k to close at N5 per share.

The market was very dull today with investors trading a total of 135 million shares valued at 681.2 million in 2,909 deals.

This is in sharp contrast to the 245.4 million shares traded last Friday worth N2.3 billion transacted in 3,260 deals.

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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Economy

Crude Oil Jumps 2% as IEA Forecast 2022 Demand Growth

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Crude Oil Export Sales

By Adedapo Adesanya

Prices of crude oil expanded by more than $2 on Thursday after the International Energy Agency (IEA) raised its demand growth forecast for this year.

Brent crude futures gained $2.20 or 2.3 per cent to settle at $99.60 a barrel while the United States West Texas Intermediate (WTI) crude futures rose by $2.41 or 2.6 per cent to $94.34 per barrel.

Global crude oil demand will rise by 2.1 million barrels per day this year, the IEA said in the latest monthly edition of its flagship Oil Market Report, spurred by the switch from gas to oil for electricity generation.

The new number is 380,000 barrels per day higher than the previous monthly forecast. It also means that the IEA now expects global oil demand this year to average 99.7 million barrels daily.

Supply, according to the IEA, already exceeds demand, as it hit 100.5 million barrels per day last month, with production from the Organisation of the Petroleum Exporting Countries and allies (OPEC+) adding 530,000 barrels per day in line with the production increase deal and non-OPEC+ output rising by 870,000 barrels per day.

“With several regions experiencing blazing heatwaves, the latest data confirm increased oil burn in power generation, especially in Europe and the Middle East but also across Asia,” the International Energy Agency said in its report. “Fuel switching is also taking place in European industry, including refining,” it said.

The agency also revised upwards its forecast for oil supply for the full year, noting a smaller than expected decline in Russian oil production and exports.

By contrast, OPEC cut its 2022 forecast for growth in world oil demand, citing the impact of Russia’s invasion of Ukraine, high inflation, and efforts to contain the pandemic.

OPEC expects 2022 oil demand to rise by 3.1 million barrels per day, down 260,000 barrels per day from the previous forecast. It still sees a higher overall global oil demand figure than the IEA for 2022.

OPEC+, however, is not eager to tap into this effective spare capacity, which would diminish the group’s power to respond to market emergencies with increased production.

After OPEC+’s last meeting in early August, OPEC+ referred to its “severely limited” spare capacity, which should be used with “great caution in response to severe supply disruptions”, reinforcing the IEA’s predictions that additional OPEC+ output increases are unlikely in the coming months.

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Economy

Treasury Bills Rates Rise Across Tenors at Primary Market

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Treasury Bills CBN Sold

By Dipo Olowookere

The Central Bank of Nigeria (CBN) offered treasury bills to investors at attractive rates at the primary market auction (PMA) on Wednesday as the government intends to use the avenue to borrow more money from the local debt market.

The stop rates were increased by the apex bank across the three maturities offered for sale during the session, with the shortest end of the curve witnessing the highest jump.

According to an analysis of the sales, the 91-day bill cleared at 3.50 per cent, 0.70 per cent higher than the previous session’s stop rate of 2.80 per cent. The 182-day tenor was sold to traders at 4.50 per cent, 0.40 per cent higher than the 4.10 per cent offered at the preceding PMA, while the 364-day maturity cleared at 7.45 per cent, 0.45 per cent higher than the 7.00 per cent of the earlier exercise.

Business Post reports that the CBN, which auctioned the debt instruments for the Debt Management Office (DMO) on behalf of the federal government of Nigeria, offered for sale N150.62 billion worth of the T-Bills and it received subscriptions valued at N187.53 billion, with an allotment of N150.62 billion made at the end of the exercise.

A breakdown showed that N1.02 billion worth of the three-month bill was auctioned by the central bank but bids worth N1.80 billion were received and N1.15 billion issued to subscribers, with the range of bid rates between 2.70 per cent and 10.00 per cent.

As for the six-month instrument, N1.82 billion was taken to the market but the appetite for this maturity was low as subscriptions worth N1.69 billion were processed between 4.10 per cent and 7.00 per cent, but the apex bank sold N1.3 billion at 4.5 per cent.

It was observed that the strong demand for higher tenors, ostensibly because of the higher rates, continued during the exercise for the 12-month bill. The CBN approached the market with N147.78 billion worth of the instrument but the demand rose to N184.04 billion, with investors bidding between 6.00 per cent and 12.00 per cent. However, the bank issued N148.15 billion at 7.45 per cent.

This trend is expected to continue at the next PMA as investors shop for investment tools that will fetch them higher yields amid rising inflationary pressures eroding the gains from risk-free assets.

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Economy

Equity Exchange Loses N33bn Amid Low Turnover

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equity exchange

By Dipo Olowookere

The bears returned to the domestic equity exchange on Thursday after profit-taking in banking and consumer goods stocks shrank the trading indices by 0.12 per cent.

Business Post observed that the banking index shed 0.62 per cent as the consumer goods counter depreciated by 0.03 per cent, while the insurance and industrial goods sectors gained 0.61 per cent and 0.10 per cent respectively, with the energy index closing flat.

At the close of trades, the All-Share Index (ASI) depleted by 60.87 points to 50,014.60 points from 50,075.47 points, while the market capitalisation deflated by N33 billion to N26.976 trillion from N27.009 trillion.

The loss posted yesterday was heavily impacted by blue-chip stocks led by MTN Nigeria, Zenith Bank and others as the market breadth closed positive with 21 price gainers and 15 price losers led by ABC Transport, which fell by 6.67 per cent to 28 Kobo.

Jaiz Bank went down by 5.56 per cent to 85 Kobo, Stanbic IBTC declined by 3.28 per cent to N28.05, Caverton depreciated by 2.86 per cent to N1.02, while UBA lost 2.78 per cent to sell for N7.00.

The share price of NAHCO improved during the session by 10.00 per cent to N5.83 as FCMB appreciated by 9.84 per cent to N3.35. Ikeja Hotel gained 9.43 per cent to quote at N1.16, Multiverse grew by 9.22 per cent to N2.25, while Courteville increased its share value by 8.51 per cent to 51 Kobo.

The activity chart was mixed on Thursday as the day was marred by low turnover after the volume of transactions decreased by 52.16 per cent to 133.6 million units from the previous day’s 279.2 million units.

However, the trading value improved by 17.06 per cent to N2.4 billion from N2.1 billion, while the number of deals appreciated by 20.02 per cent to 4,292 deals from 3,576 deals.

UBA sold the highest volume of shares on the floor of the Nigerian Exchange (NGX) Limited on Thursday, 20.5 million units valued at N143.7 million and was closely followed by Chams, which sold 9.0 million units worth N2.8 million. Access Holdings transacted 8.2 million shares for N72.7 million, Japaul exchanged 7.4 million equities worth N2.9 million, while Jaiz Bank traded 7.1 million stocks valued at N6.2 million.

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