Economy
SEC to Enlighten Investors on ‘Investing in Difficult Times’
By Modupe Gbadeyanka
Efforts are being made by the Securities and Exchange Commission (SEC) to educate investors in the Nigerian capital market to understand the rudiments of investing in difficult times.
On Tuesday, August 18, 2020, the commission will hold a webinar, where experts in the sector will dissect this topic and explain ways investors can make a profit in this present situation.
It is no news that since the beginning of the year, the global COVID-19 pandemic has affected many businesses as well as economies of the world.
The effect of the virus, which is yet to wrap, caused economies of the United Kingdom, France and others to slip into recession and recently, Nigeria’s Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, warned that the country may fall into an economic crisis soon.
As things continue to get harder and the purchasing power of citizens further shrinks, it may be tough for capital market investors, who are battling with a double war of rising inflation rate and the declining interest rate on their investments, especially on government debt securities.
To help investors navigate these issues, the apex capital market regulator has come with this online lecture, which starts by 11am Nigerian time.
Speakers for the event are Mrs Tope Omojokun, Mr Derrick Msibi and Mr Efiok Efiok.
Mrs Tope Omojokun has over 17 years’ experience across Commercial and Corporate Banking, Wealth and Investment Management.
She has worked with Access Bank Plc. (formerly Intercontinental Bank Plc.) and later joined E.oN (UK) Limited as a Credit Specialist before proceeding to Asset and Resource Management Company Limited (ARM), where she was a Relationship Manager with the Wealth Management division before joining Investment One Funds Management Limited.
She holds a Bachelor’s Degree in Economics from the Obafemi Awolowo University, Ile-Ife, an MA (Management) from the University of Nottingham and is currently pursuing a Doctoral degree (Ph. D) in Business Administration (Entrepreneurship) at Babcock University. Tope currently serves as President of Fund Managers Association of Nigeria.
On his part, Mr Derrick Msibi is the Chief Executive of STANLIB Asset Management, the investment arm of the Liberty Group, an insurance company listed on the Johannesburg Stock Exchange and a part of the Standard Bank Group.
STANLIB is a steward of R569 billion of customer investments in various investment strategies straddling listed and alternative investments.
Mr Msibi is a chartered accountant with degrees in finance and accounting at both bachelors, honours and masters level from the University of Cape Town. He is a holder of the Program for Management Development Certificate from Harvard Business School and a Certificate of Management (a corporate-customised programme) from London Business School.
For Mr Efiok Efiok, who joined the SEC in 2002, he holds a degree in Business Management and is an associate of the Chartered Institute of Stockbrokers (CIS), Nigeria. H
e worked from 2002 to 2008 in the Collective Investment Services Department (now Investment Management Services Department, the Department responsible for the regulatory authorization and supervision of all forms of Collective Investment Schemes products.
He moved to the Monitoring and Investigation Department, 2008 – 2013, as part of the team undertaking continuous supervision of operations and operational capacity of all registered Capital Market Operators with respect to their registered market functions.
From 2014 to 2016, Mr Efiok served as Head of Fund Management Supervision Division, responsible for continuous supervision of Market intermediaries undertaking Asset management activities and subsequently became the Head of Investment Management Department from 2016 – till date.
By Adedapo Adesanya
The Naira opened the new trading week on a negative note on Monday at the Nigerian Autonomous Foreign Exchange Market (NAFEX) and the black market.
At the parallel market, the Nigerian currency weakened against the US Dollar by N5 to sell for N1,380/$1 compared with the preceding session’s rate of N1,375/$1, and at the GTBank FX desk, it shed N1 to trade at N1,373/$1 versus N1,372/$1.
At the official market, it lost 63 Kobo or 0.05 per cent against the Dollar during the session to close at N1,362.84/$1, in contrast to last Friday’s value of N1,362.21/$1.
However, the Nigerian Naira gained N2.30 against the Pound Sterling at the spot market yesterday, quoting at N1,821.29/£1 compared with the previous rate of N1,823.59/£1, and improved against the Euro by 23 Kobo to settle at N1,574.35/€1 versus N1,574.58/€1.
Data from the Central Bank of Nigeria (CBN) showed that interbank forex turnover increased to $92.248 million across 90 deals, from $73.565 million last Friday.
On the policy front, participants believed that the application of the fourth edition of the Foreign Exchange Manual of the central bank, which introduces updated guidelines for foreign exchange transactions and tightening compliance requirements for authorised dealers and market participants, will enhance market flexibility and ease previous restrictions.
Meanwhile, the cryptocurrency market snapped from recent declines, jolted by Strategy’s purchase of 1,550 Bitcoin for approximately $101 million, increasing its total holdings to 845,256 BTC. The company raised $181 million through common stock sales, using the proceeds to fund the bitcoin purchase and increase its cash reserves to $1 billion, pushing the price of the coin higher by 3.2 per cent to $63,731.69.
Cardano (ADA) appreciated by 8.4 per cent to $0.1738, Ethereum (ETH) rose by 5.2 per cent to $1,711.54, Solana (SOL) expanded by 5.1 per cent to $67.82, and Ripple (XRP) improved by 4.9 per cent to $1.18.
Further, Dogecoin (DOGE) jumped by 4.3 per cent to $0.0873, Binance Coin (BNB) soared by 2.7 per cent to $609.50, and TRON (TRX) increased by 0.7 per cent to $0.3274, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $0.9997 and $0.9998, respectively.
By Aduragbemi Omiyale
The federal government has been advised to consider exploring other funding sources to finance its budget deficits.
Speaking with Punch recently, the chief executive of CSA Advisory, Mr Aliyu Ilias, said the current appetite for borrowing by the government cannot be sustained because it elevates debt-servicing costs.
The economist suggested the sale of some public assets and the involvement of the private sector in infrastructure financing for economic growth.
According to him, running to the debt markets to raise funds for the government is not the best route to take, as the reliance on borrowing always leads to higher debt-servicing obligations.
“The more you borrow, the more you are also incurring more debt services,” he said, tasking the government to also capitalise on increased oil revenues stemming from ongoing geopolitical tensions in the Middle East.
“The government can actually sell off some of their assets to raise more money. The government can also, if you look at the revenue we are getting from oil, it’s getting more, especially with this war. It’s another opportunity for us to actually not borrow again,” Mr Ilias submitted.
He also pointed to ongoing tax reforms as another avenue to improve government finances and narrow the fiscal gap.
“The government can also look at tax reform. The fact is that the government does not have money. The only chance for getting more money is to address the financial deficit,” he added.
By Adedapo Adesanya
Crude oil was up by $1 on Monday as Iran and Israel said they had halted attacks on each other following an appeal from US President Donald Trump.
Brent crude futures gained $1.16 or 1.3 per cent to trade at $94.25 a barrel, while the US West Texas Intermediate (WTI) crude futures were up 76 cents or 0.8 per cent to $91.30 per barrel.
Iran’s military said Monday it halted attacks on Israel after the two countries exchanged their most intense strikes in months, further straining an already shaky ceasefire as well as the US-Israeli relationship. Iran, however, said it would resume strikes if Israel continued to hit Hezbollah in Lebanon.
Israel also halted attacks on Iran, Israeli Prime Minister Benjamin Netanyahu said, stopping short of acknowledging a ceasefire that US President Donald Trump said the countries were aiming for.
President Trump said earlier that the US blockade, which was introduced in April, would remain in place “in full force” until a final peace agreement between the two warring nations is reached.
Prices gained more than 5 per cent earlier on Monday after renewed Israeli strikes on Iran and attacks on Lebanon had reduced hopes of an imminent end to the wider war.
Market analysts noted that because of the strikes, investors were concerned that flows through the Strait of Hormuz might remain restricted for longer. Roughly a fifth of the world’s daily supply of oil and liquefied natural gas passed through the waterway before US-Israeli airstrikes at the end of February unleashed the latest escalation of the Middle Eastern conflict.
Yemen’s Iran-aligned Houthis said on Monday they would ban ships linked to Israel from the Red Sea after Israel renewed its military attacks on Iran, adding to concerns about global shipping and energy flows.
In the face of the supply crisis, a sub-group under the Organisation of the Petroleum Exporting Countries and its allies (OPEC+) on Sunday agreed on its fourth oil output target increase in four months. The seven members decided to increase targets by 188,000 barrels per day from July, the same as the June hike, which was adjusted down from monthly increases of 206,000 barrels per day in May and April to take into account the exit of the United Arab Emirates (UAE).
On paper, the sub-group has increased its output quotas from April to June by almost 600,000 barrels per day, but in reality, the group’s production has collapsed due to export cuts by Gulf members, averaging 33.19 million barrels per day in April compared with 42.77 million barrels per day in February.
Saudi Arabia has cut its official selling prices for crude oil to Asia in July for a second month.
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