Economy
Oil Rises as US Slams Fresh Sanctions on Iran
By Adedapo Adesanya
The announcement of fresh sanctions on Iran by the United States on Thursday jerked the price of the Brent crude futures higher by $1.30 or 1.1 per cent to $119.81 per barrel with the West Texas Intermediate (WTI) crude futures leaping by $2.27 or 2 per cent to $117.58 a barrel.
With no nuclear deal with Iran in sight, the United States Treasury slapped additional sanctions on companies based in Iran, China and the United Arab Emirates (UAE) for enabling the export of Iran’s petrochemicals.
On Thursday, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) implemented new sanctions on what it called “a network of Iranian petrochemical producers” and “front companies” in China and the UAE that support Iranian petrochemical exports abroad.
“This network helps effectuate international transactions and evade sanctions, supporting the sale of Iranian petrochemical products to customers in the PRC and the rest of East Asia,” according to a statement from the Treasury Department.
The sanctions come as talks to return to the nuclear deal, which former US President Donald Trump revoked in 2018, have stalled.
The US also noted that it will continue to expose the networks Iran uses to conceal sanctions evasion activities.
Prices of the black gold had slipped more than 2 per cent after the US Federal Reserve raised its key interest rate by 0.75 per cent, the biggest hike since 1994.
It looked worsening as top economies like Britain and Switzerland also hiked rates, feeding worries about global economic growth.
The Swiss National Bank increased its policy rate to -0.25 per cent from the -0.75 per cent level it has deployed since 2015. The hike was the first increase by the country’s central bank since September 2007 while the Bank of England increased rates from 1 per cent to 1.25 per cent, the fifth consecutive rise, pushing them to the highest level in 13 years.
However, with the sanctions, the market trajectory changed.
Also, The International Energy Agency (IEA) said it expects demand to rise further in 2023, growing by more than 2 per cent to a record 101.6 million barrels per day.
There was also positivity that China’s oil demand will rebound as it eases COVID-19 restrictions.
In addition, Libya’s oil output has collapsed to 100,000-150,000 barrels per day, a fraction of the 1.2 million barrels per day seen last year. There are expectations that it could continue in the face of continued unrest.
By Adedapo Adesanya
It was green for the NASD Over-the-Counter (OTC) Securities Exchange on Monday, April 20, as it recorded a 0.52 per cent appreciation.
During the session, the NASD Unlisted Security Index (NSI) added 20.31 points to close at 3,913.46 points compared with last Friday’s 3,893.15 points, and the market capitalisation went up by N12.15 billion to close at N2.341 trillion versus the previous N2.329 trillion.
Yesterday, there were five price gainers led by MRS Oil Plc, which added N19.75 to sell at N217.50 per share compared with the previous price of N197.75 per share. Central Securities Clearing System (CSCS) Plc appreciated by N1.02 to trade at N59.02 per unit versus N58.00 per unit, IPWA Plc grew by 66 Kobo to N7.27 per share from N6.61 per share, Lighthouse Financial Services Plc increased by 7 Kobo to 79 Kobo per unit from 72 Kobo per unit, and Industrial and General Insurance (IGI) Plc chalked up 3 Kobo to sell at 66 Kobo per share versus 63 Kobo per share.
Data from Monday’s trading session showed that the volume of securities traded rose by 86.4 per cent to 245,830 units from 131,870 units, but the value of securities slowed by 37.2 per cent to N11.1 million from N17.8 million, while the number of deals remained unchanged at 24 deals.
The most traded stock by value on a year-to-date basis was Great Nigeria Insurance (GNI) Plc with 3.4 billion units worth N8.4 billion, followed by CSCS Plc with 58.8 million units sold for N4.0 billion, and Okitipupa Plc with 27.8 million units transacted for N1.9 billion.
Similarly, the traded stock by volume on a year-to-date basis was GNI Plc with 3.4 billion units traded for N8.4 billion, trailed by Resourcery Plc with 1.1 billion units valued at N415.7 million, and Infrastructure Guarantee Credit Plc with 400 million units exchanged for N1.2 billion.
By Adedapo Adesanya
The Naira depreciated against the United States Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Monday, April 20, by N6.03 or 0.45 per cent to close at N1,349.67/$1, in contrast to the previous session’s N1,343.64/$1.
In the same vein, the local currency also fell against the Pound Sterling in the trading first session of the week by N2.39 in the official FX market to trade at N1,826.78/£1 compared with the N1,824.39/£1 it was exchanged for last Friday, but appreciated against the Euro by N1.76 to finish at N1,589.38/€1 versus N1,591.14/€1.
A look at the black market window showed that the Nigerian Naira traded flat against the US Dollar yesterday at N1,375/$1, but appreciated by N1 at the GTBank forex counter to sell at N1,354/$1 compared with the preceding session’s N1,355/$1.
The Naira is under pressure from surging international payments at the start of the week, which is expected to put further pressure on the country’s foreign reserve. The reserve is expected to decline further amid fluctuations in crude oil prices in the global commodity market.
The US Dollar is showing slight strength globally due to rising tensions between the US and Iran. Investors are moving towards safer assets like the Dollar because of uncertainty in the Middle East. The situation is tense as Iran has pulled out of talks with the US, and concerns remain about the Strait of Hormuz, an important route for global oil supply.
As for the cryptocurrency market, digital assets were largely up as markets bet on progress in cease-fire talks between Iran and the US, even as the current two-week truce nears its Wednesday deadline.
US President Donald Trump said on Monday that he is not likely to extend it, and market analysts noted that that’s the deadline markets are now trading on.
Solana (SOL) gained 2.0 per cent to sell at $85.64, Bitcoin (BTC) jumped by 1.9 per cent to $75,791.24, Ripple (XRP) increased by 1.9 per cent to $1.43, and Binance Coin (BNB) rose by 1.8 per cent to $630.76.
Further, Ethereum (ETH) improved by 1.7 per cent to $2,311.60, Cardano (ADA) soared by 1.6 per cent to $0.2490, and Dogecoin (DOGE) expanded by 1.3 per cent to $0.0954, while TRON (TRX) depreciated by 0.9 per cent to $0.3286, with the US Dollar Tether (USDT) and the US Dollar Coin (USDC) unchanged at $1.00 apiece.
By Dipo Olowookere
The continued strong appetite for local stocks further strengthened the Nigerian Exchange (NGX) Limited by 0.44 per cent on Monday.
The domestic bourse remained in green territory yesterday despite a weakened activity level, which saw the trading volume and value down 24.31 per cent and 6.62 per cent, respectively, while the number of deals increased by 34.23 per cent.
According to trading data from Customs Street, investors transacted 984.0 million shares worth N50.8 billion in 76,410 deals on the first trading day of this week compared with the 1.3 billion shares valued at N54.4 billion traded in 56,923 deals last Friday.
Access Holdings returned to the top of the activity log with 91.7 million equities sold for N3.0 billion, First Holdco exchanged 70.2 million stocks worth N4.8 billion, Zenith Bank traded 54.9 million shares valued at N7.0 billion, Lasaco Assurance transacted 53.8 million equities worth N107.5 million, and UBA recorded a turnover of 52.6 million stocks valued at N2.7 billion.
Business Post reports that investor sentiment was weak on Monday despite the positive outcome, as there were 27 appreciating stocks and 46 depreciating stocks, implying a negative market breadth index.
Bargain-hunting in NAHCO, which went up by 10.00 per cent to N242.00, and others ensured that the NGX remained in green territory. Union Dicon also gained 10.00 per cent to trade at N18.15, Fidelity Bank improved by 9.98 per cent to N22.05, Trans-Nationwide Express expanded by 9.92 per cent to N6.65, and Access Holdings rose by 9.87 per cent to N32.85.
On the flip side, Living Trust Mortgage Bank lost 10.00 per cent to quote at N3.69, Stanbic IBTC also declined by 10.00 per cent to finish at N169.70, Transcorp Power gave up 9.97 per cent to close at N272.70, Abbey Mortgage Bank crashed by 9.88 per cent to N7.30, and Guinea Insurance dropped 8.80 per cent to settle at N1.14.
It was observed that all the major sectors of the market were bullish yesterday, with the banking index growing by 2.56 per cent. The energy space appreciated by 0.75 per cent, the consumer goods counter improved by 0.38 per cent, and the industrial goods sector gained 0.35 per cent, while the insurance segment closed flat.
At the close of business, the market capitalisation went up by N609 billion to N140.436 trillion from N139.827 trillion, and the market capitalisation soared by 946.27 points to 218,113.84 points from 217,167.57 points.
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