Economy

NSE: Analysts Expect Sell-Offs to Persist This Week

Published

6 years ago

10/06/2019

By Modupe Gbadeyanka

The Nigerian Stock Exchange (NSE) has struggled to keep its head above water since MTN Nigeria Plc was hit with news of the Economic and Financial Crimes Commission (EFCC) raiding its head office in Lagos to investigate how it was listed on the local bourse.

When the telco joined the Nigerian stock exchange on May 16, 2019, the market was booming, but that news story on May 24, 2019, gradually brought an end to the honeymoon.

Since then, the market has been battling hard to escape from the tight grip of the bears without much success.

As the market begins trading this week, analysts have said investors should not expect any miracle to occur in the absence of any positive event to trigger the return of the bulls.

This week, precisely on Wednesday, June 12, 2019, President Muhammadu Buhari is expected to address the nation, where he should roll out his plans for the next four years in office.

On May 29, 2019, when he was sworn-in for another four years in office, he did not give any speech as expected, but shifted it to this week, which is now to be celebrated as Democracy Day with a public holiday.

During trading last week, profit taking activities dominated the stock market and if nothing positive happens this week, this trend is expected to continue.

This view was echoed by analysts at Cowry Asset, who said, “In the new week, in the absence of major stimuli, we expect sustained bearish pressure on the local equities market as investor apathy pervades the bourse, resulting in general sell offs amid flight to safety.”

Sharing this same sentiment were those at United Capital Research, who said the bears will maintain dominance, though the bulls will attempt to bellow so as to attract attention of investors.

“Looking ahead, we expect market performance to remain lukewarm in the absence of a catalyst. However, we do not rule out the possibility of intermittent gains driven by bargain hunters,” they said.

For analysts at Cordros Research, “We reiterate our view that the blend of a compelling valuation story, together with positive macroeconomic picture leaves scope for market recovery in the medium term. However, we guide investors to tread the cautious trading path in the short term.”

Those at Afrinvest Research said, “Although we expect bargain hunting on stocks which have recently suffered losses next week, we believe sentiment would remain bearish in the absence of any major market catalyst.”

Analysts at Business Post are of the opinion that investors will want to trade cautiously this week and watch how things will turn out, especially with the issue between Oando and the Securities and Exchange Commission (SEC).

“We do not expect heavy transactions this week as investors mainly look forward to President Buhari’s June 12 speech.

“They will also want to know what becomes of the Oando saga with SEC especially with the AGM already fixed for Tuesday.

“With all these in mind, we do not expect the market to close positive this week as investors will want to continue to take profit and watch events from a safer region.

“However, as we have always advised, this is the best time to mop up some sound stocks presently trading at low prices, especially those that could give holders interim dividends in a month’s time,” analysts at Business Post said.

Economy

Trump’s Tariffs: US Faults Nigeria’s Import Ban on Beef, Poultry, Juice, Others

Published

4 hours ago

08/04/2025

Adedapo Adesanya

By Adedapo Adesanya

The United States has lamented Nigeria’s import ban on 25 different products, particularly in agriculture, pharmaceuticals, beverages, and consumer goods, as it rationalised the recent decision to slap a 14 per cent retaliatory tariff.

The United States Trade Representative, in a statement on Monday posted on its X platform, said Nigeria’s restrictions on items like beef, pork, poultry, fruit juices, medicaments, and spirits limit US market access and reduce export opportunities.

“These policies create significant trade barriers that lead to lost revenue for US businesses looking to expand in the Nigerian market,” it wrote.

Last week, the administration of President Donald Trump imposed various tariffs ranging between 10 per cent and 65 per cent on different countries across the world, including Nigeria which got a 14 per cent tariff on its exports to the US.

In response, the Nigerian Minister of Trade, Industry, and Investment, Mrs Jumoke Oduwole, said Nigeria would take a pragmatic approach and will boost non-oil exports to deal with the drawbacks from the US move.

She also said Nigeria will be willing to negotiate and will be speaking with the World Trade Organisation (WTO) on the way forward.

On his part, the Minister of Finance, Mr Wale Edun, said that the Economic Management Team (EMT) would meet to assess the likely impact of the 14 per cent tariff on goods exported from Nigeria to the US.

He said the EMT will afterwards, make recommendations to cushion its impact on the nation’s economy.

The Minister also said the federal government will boost non-revenue as a means of cushioning the adverse effects to trade tariffs imposed on countries by President Trump.

Mr Edun also assured that while the adverse effect on Nigeria will be through an oil price plunge, the government is intensifying efforts to ramp up oil production and boost non-oil revenues.

Economy

Nigeria, Japan Launch Naira-based Venture Fund for Startups

Published

7 hours ago

08/04/2025

Adedapo Adesanya

By Adedapo Adesanya

Nigeria and Japan have launched a strategic venture capital initiative that will channel Naira-denominated investments into high-growth startups, shielding them from currency risks while unlocking access to long-term concessional financing.

The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, met with officials from the Nigeria Sovereign Investment Authority (NSIA) and the Japan International Cooperation Agency (JICA) to finalise the framework of the fund, which has now received formal approval from the Japanese government.

Speaking on the development, Mr Edun welcomed the development, calling it a timely response to Nigeria’s youthful demography.

He said this fund provides critical financial backing across the capital structure—from equity to debt—and is aligned with President Bola Tinubu’s Renewed Hope Agenda for inclusive economic growth, he stated.

On his part, NSIA CEO, Mr Aminu Umar-Sadiq confirmed that the initiative satisfies two key conditions set by the Minister: mitigating foreign exchange volatility by investing in Naira and securing first-loss or grant capital to de-risk private investment.

“With JICA’s support, this is not just a proposed solution—it’s a fully approved, ready-to-launch initiative,” Mr Umar-Sadiq said.

Adding his input, JICA Director General, Mr Takao Shimokawa announced that diplomatic agreements would be signed within weeks, with full implementation expected thereafter.

By combining international concessional financing with domestic currency stability, the fund marks a new model for venture capital in Africa, aimed squarely at empowering the next generation of Nigerian innovators.

Economy

Nigeria’s Economic Management Team to Assess Impact of Trump’s Tariffs

Published

8 hours ago

08/04/2025

Adedapo Adesanya

By Adedapo Adesanya

The Minister of Finance, Mr Wale Edun, has said the country’s Economic Management Team (EMT) would meet to assess the likely impact of the 14 per cent tariff on goods exported from Nigeria to the United States.

Mr Edun made the disclosure while speaking at an event organised by the Ministry of Finance Incorporated (MOFI) on Monday.

The Trump administration recently imposed various tariffs ranging between 10 per cent and 65 per cent on different countries across the world, including Nigeria which got a 14 per cent tariff on its exports to the United States.

He said the EMT will afterwards make recommendations to cushion its impact on the nation’s economy, noting that the federal government will boost non-revenue as a means of cushioning the adverse effects to trade tariffs imposed on countries by President Trump.

Mr Edun stated that while the adverse effect on Nigeria will result in an oil price plunge, the government is intensifying efforts to ramp up oil production and boost non-oil revenues.

The Finance Minister noted that the US, which is at the centre of the tariff war had on April 2, announced that it would exempt mineral exports, including oil.

“Therefore, it’s the price effect, the oil price effect that may affect Nigeria. And it is the job and responsibility of the economic management team of President Bola Ahmed Tinubu, amongst others, to look at the various scenarios that might play out.

“There’s global uncertainty at a huge level, so nobody knows exactly what will happen- the announcement that has been made. We’re not sure what will be delayed, what will be reversed, or what will be implemented.

“So, it is not an announcement that the budget is being reviewed. It’s an announcement that it is our responsibility to look at the various scenarios and options and advise government accordingly.”

Mr Edun also highlighted plans to look at budget adjustment, expenditure prioritisation as well as innovative non-debt financing strategies.

According to him, Nigeria had recorded a trade surplus in the last three years (2022-2024) with the US.

“Nigeria-US Trade has been in surplus in the last 3 years (2022-2024). Nigeria’s exports to the US were N1.8 trillion, N2.6 trillion and N5.5 trillion in 2022-2024, respectively.

“Fortunately, oil and mineral exports accounted for 92 per cent. Implying oil and minerals exports amounted to N5.08 trillion in value while non-oil was just N0.44 trillion.

“Consequently, the tariff effect on exports is negligible if we sustain our oil and minerals export volume.

“The adverse effect on Nigeria will be through oil price plunge. We are intensifying efforts to ramp up crude oil production to curtail any price effect

“We are also focusing on non-oil revenue mobilisation by FIRS and Customs, budget adjustment and prioritisation where possible, and also and innovative non-debt financing strategies,” the Minister said.