By Adedapo Adesanya

The oil market slumped on Thursday, pressured by an expected increase in supply, supported by rising expectations of a Federal Reserve interest rate cut.

The International Energy Agency (EIA) made a slight upward revision to its demand outlook for next year but still expected the oil market to be comfortably supplied, with Brent crude futures losing 11 cents or 0.15 per cent to trade at $73.41 per barrel and the US West Texas Intermediate (WTI) crude futures declining by 27 cents or 0.38 per cent to finish at $70.02 per barrel.

The IEA in its monthly oil market report increased its 2025 global oil demand growth forecast to 1.1 million barrels per day from 990,000 barrels per day last month, largely in Asian countries due to the impact of China’s recent stimulus measures.

At the same time, the IEA expects nations not in the Organisation of the Petroleum Exporting Countries and Allies (OPEC+) group to boost supply by about 1.5 million barrels per day next year, driven by the US, Canada, Guyana, Brazil and Argentina – more than the rate of demand growth.

On Wednesday, OPEC cut its demand growth forecast for 2024 for the fifth straight month.

The IEA said that, even excluding the return to higher output quotas, its current outlook is to a 950,000 barrels per day supply overhang next year, which is almost 1 per cent of the world’s supply.

The Paris-based agency said this would rise to 1.4 million barrels per day if OPEC+ goes ahead with its plan to start unwinding cuts from the end of next March.

Next year’s surplus could make it harder for OPEC+ to bring back production. The hike was earlier due to start in October 2024, but OPEC+ has delayed it amid falling prices.

Meanwhile, inflation rose slightly in November increasing the possibility of a US Federal Reserve rates cut again as the data fed optimism about economic growth and energy demand.

Support also came as crude imports in China grew annually for the first time in seven months in November, up more than 14 per cent from a year earlier.

By Dipo Olowookere

The 0.22 per cent decline in the banking sector could not bring down the Nigerian Exchange (NGX) Limited at the close of business on Thursday, Business Post reports.

The sector witnessed profit-taking during the trading session but the gains recorded by the others ensured that Customs Street maintained its upward movement by 0.25 per cent yesterday.

The energy index improved during the session by 2.74 per cent, the insurance counter expanded by 0.82 per cent, the industrial goods industry rose by 0.62 per cent, and the consumer goods sector went up by 0.32 per cent.

Consequently, the All-Share Index (ASI) grew by 250.91 per cent to 98,760.59 points from 98,509.68 points and the market capitalisation increased by N152 billion to N59.867 trillion from N59.715 trillion.

Investor sentiment remained bullish on Thursday as the bourse ended with 30 appreciating shares and 21 depreciating shares, implying a positive market breadth index.

The duo of Tantalizers and Conoil gained 10.00 per cent each to sell for N1.76 and N387.20, respectively, Custodian Investment soared by 9.92 per cent to N13.85, Africa Prudential gained 9.79 per cent to quote at N15.70, and Golden Guinea Breweries went up by 9.75 per cent to N7.88.

Conversely, DAAR Communications lost 8.47 per cent to settle at 54 Kobo, Caverton plunged by 8.16 per cent to N1.80, Omatek tumbled by 7.46 per cent to 62 Kobo, ABC Transport crashed by 7.41 per cent to N1.25, and Consolidated Hallmark slipped by 7.11 per cent to N2.22.

It was quite a busy day yesterday at the NGX as market participants engaged in transactions ahead of the festive holidays, with the trading volume, value and number of deals rising by 52.98 per cent, 9.23 per cent, and 4.54 per cent, respectively.

This was because investors transacted 489.7 million stocks valued at N7.1 billion in 8,304 deals during the trading day compared with the 320.1 billion stocks worth N6.5 billion traded in 7,943 deals a day earlier.

Topping the activity log was FCMB with the sale of 77.6 million equities for N698.7 million, eTranzact exchanged 70.1 million shares worth N473.4 million, Haldane McCall transacted 47.8 million stocks valued at N234.3 million, Japaul exchanged 33.6 million equities worth N73.8 million, and Secure Electronic Technology traded 16.8 million stocks valued at N8.8 million.

By Dipo Olowookere

Increased appetite for one-year Nigerian treasury bills forced the Central Bank of Nigeria (CBN) to trim the stop rate at primary market auction (PMA) conducted on Wednesday.

Business Post reports that the rate was brought down by 0.13 per cent during the exercise by the bank to 22.80 per cent from the 22.93 per cent it cleared in the preceding PMA.

It was observed that investors showed significant interests in the tenor at midweek, though lower than the previous auctions.

At the session, the CBN brought to the market N256.5 billion worth of the 12-month bills but received bids valued at N888.4 billion, showing that subscribers were ready to lock their funds in the long-dated asset class.

However, at the close of the exercise, the central bank allotted N512.0 billion worth of maturity to investors after it cut the top rate, which some investors wanted as high as 28.00 per cent, according to details of the exercise obtained by this newspaper.

Unfortunately, the other tenors, the 91-day and 181-day T-bills, did not get the same attention as the 364-day maturity on Wednesday.

The apex bank was at the PMA with N10.8 billion worth of the three-month bills but only received bids valued at N8.8 billion, which was fully allotted to investors, but the stop rate was left intact at 18.00 per cent at the close of the exercise.

As for the six-month tenor, it recorded a slight oversubscription during the exercise after the central bank offered for sale N8.4 billion but got subscriptions worth N10.6 billion, though the allocation was lowered to N7.0 billion with the stop rate unchanged at 18.50 per cent.

At the primary auction on Wednesday, the CBN intended to sell treasury bills valued at N275.7 billion but ended up allotting N527.8 billion after receiving offers worth N907.8 billion, indicating strong demand for the government debt securities.