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Stock Market Bleeds as CBN Cancels MPC Meeting, Investors Lose N65b



local bourse bear market

By Modupe Gbadeyanka

Trading activities on the floor of the Nigerian Stock Exchange (NSE) opened for the new week on Monday on a negative note.

The stock market, which reversed a downward trend last Friday, resumed bearish today after pointing south by 0.40 percent, shrinking the year-to-date return to 17.44 percent.

The loss occurred as the Central Bank of Nigeria (CBN) failed to hold its first Monetary Policy Committee (MPC) meeting for the year today as a result of lack of quorum.

Like in America, where the Senate failed to pass the country’s spending bill, leading to a government shutdown since last Friday, the Nigerian Senate has failed to confirm nominees of the committee sent to the upper parliament last year by President Muhammadu Buhari as a result of an impasse with the executive.

This made it impossible for the MPC meeting to hold today as earlier planned. However, the CBN Governor, Mr Godwin Emefiele, announced today that the rates, as announced at its last meeting in November 2017, would be retained.

At the close of transactions on the floor of the Nigerian bourse on Monday, the All-Share Index (ASI), which stood at 45,092.83 points on Friday, depreciated by 180.30 points on Monday to settle at 44,912.53 points.

Also, the market capitalisation, which was N16.155 trillion at the last trading session, decreased by N64.6 billion to finish at N16.090 trillion when the market closed for the day.

Business Post reports that the Conglomerates sector led the activity chart on Monday with 3.9 billion shares worth N9.4 billion transacted by investors, while the Financial Services industry followed with 523.2 million equities valued at N5.2 billion exchanged.

At the close of business, the total volume of equities exchanged by investors increased by 231.25 percent from 1.3 billion to 4.4 billion.

Also, the total value of stocks transacted rose marginally by 84.57 percent from N8.6 billion last Friday to N15.9 billion today.

Transcorp continued today as the most traded equity in terms of volume on the local bourse, selling 3.9 billion shares worth N9.3 billion.

Diamond Bank followed after trading 85.8 million shares valued at N297.9 million, and FCMB, which transacted 76.7 million equities for N267 million.

Fidelity Bank sold 69 million shares for N266 million, while FBN Holdings exchanged 57.7 million shares valued at N785.7 million.

The market breadth closed at equilibrium on Monday with 26 price gainers and losers. The total number of equities that traded flat today were 43.

Nestle led the price losers’ chart today after depreciating by N30 to settle at N1470 per share, and was followed by Unilever, which went down by N2.80k to close at N44.20k per share.

Forte Oil declined by N1.78k to finish at N50 per share, GTBank lost N1.20k to close at N53.51k per share, while UAC of Nigeria crashed by 39k to end at N17.10k per share.

On the flip side, Beta Glass topped the gainers’ table after adding N2.82k to its share value to close at N59.38k per share.

PZ Cussons rose by N1.10k to finish at N23.10k per share, and International Breweries grew by N1 to end at N64 per share.

Furthermore, Cadbury advanced by 93k to close at N15.99k per share, while Nigerian Breweries increased by 81k to settle at N143 per share.

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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Nigeria’s Pension Funds Reach N14.27bn as Contributors Near 10 million



Pension Funds

By Adedapo Adesanya

The National Pension Commission (PenCom) says the total number of registered contributors and the value of pension fund assets stand at 9,795,957 million and N14.27 trillion respectively, as at June 2022.

The Director-General of PenCom, Mrs Aisha Dahir-Umar, gave the figures at a recent workshop themed Increasing Informal Sector Participation In The Contributory Pension Scheme (CPS): The Case for Micro Pension Plan (MPP).

Mrs Dahir-Umar, represented by the Head, Corporate Communications, Mr Abdulqadir Dahiru, said the increasing number of pension funds and contributors was responsible for the recapitalisation of the Pension Fund Administrators (PFA’s) by PenCom.

“The reason for the recapitalisation exercise was to ramp up the capacity of the PFA’s to manage the increasing number of registered contributors and the value of pension fund assets which stood at 9,795,957 million and N14.27 trillion respectively, as at June 30, 2022.

“PenCom increased the Minimum Regulatory Capital (Shareholders’ Fund) requirements of PFAs from N1 billion to N5 billion in 2021.

“All PFAs have complied with the commission’s directive to increase their minimum capital during the exercise which had a 12-month transition between April 27, 2021, and April 27, 2022,” she said.

According to her, the theme of the workshop aligned with the commission’s objective of expanding coverage of the CPS as it relates to the micro pension plan.

The director-general explained that the objective was to bring into the CPS, Nigerians working in the informal sector and those who were self-employed through the MPP.

Mrs Dahir-Umar noted that strategic efforts to drive the MPP remained one of the significant areas of focus of the commission.

She said the MPP was conceptualised to expand pension coverage to the informal sector, including small-scale businesses, entertainers, professionals, petty traders, artisans and entrepreneurs.

“The MPP was implemented to curb old-age poverty by assisting the workers, as mentioned above, to contribute while working and build long-term savings to fall back on when they become old, ” Mrs Dahir-Umar said.

The director-general stated that to create awareness of the MPP, the commission, in collaboration with the Pension Fund Operators Association of Nigeria, was currently championing an industry media campaign in major cities in the country’s six geopolitical zones.

She said it was expected that the exercise would bring about increased effectiveness and efficiency as well as improved service delivery in the industry.

“Let me re-affirm the commission’s commitment to creating awareness and holding social dialogue on the workings of the CPS with relevant stakeholders towards the smooth implementation of the scheme in Nigeria,” she said.

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Outrage Over Payment of N18.39bn Daily for Fuel Subsidy



fuel subsidy

By Adedapo Adesanya

Some Nigerians have started to express anger over the disclosure by the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, that the sum of N18.39 billion is used by the federal government daily to pay for fuel subsidy.

Speaking during an investigative hearing of the House of Representatives ad hoc committee looking into the petroleum subsidy regime between 2017 and 2021, the Minister revealed that, “The total amount of subsidy per day is N18.397 billion per day.”

“So, if you are projecting for the full year, it would be N6.715 trillion. If you are projecting for half year, it would be 50 per cent of that,” she informed the lawmakers.

According to the Finance Minister, this was calculated using the information provided by the Nigerian National Petroleum Company (NNPC) Limited and the regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).

She said the information showed that 64.96 million litres of fuel are the projected average daily truck out, adding that N1.774 trillion was paid to independent oil marketers as subsidy in four years.

Aside from the increasing cost of petrol importation, economic and energy experts have continued to decry the rising cost of fuel subsidy by the federal government.

In January, the federal government said it will retain fuel subsidy indefinitely and amended the 2022 budget to provide funds for that purpose, a move that saw the provision jump over 800 per cent to N4 trillion.

Mrs Ahmed, at that time, said the government realised that the timing of the planned removal of the petrol subsidy was problematic and would worsen the suffering of Nigerians.

According to her, all payments on fuel subsidies were supposed to cease from July 2022 but, “subsequent to the passage of the [Finance] Act, we went back to amend the Fiscal Framework that was submitted to the National Assembly to incorporate this demand, but after the budget was passed we have had consultations with a number of stakeholders.

“It became clear that the timing is problematic, that practically there is still heightened inflation, and also removal of subsidy will further worsen the situation, thereby, imposing more difficulties on the citizens, and Mr President clearly does not want to do that.”

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Naira Exchanges at N694/$1 in Peer-to-Peer FX Segment



Nigerian Naira

By Adedapo Adesanya

The Naira depreciated against the United States Dollar at the Peer-to-Peer (P2P) window of the foreign exchange market on Thursday by 0.32 per cent or N2 to sell for N694/$1 in contrast to the preceding day’s rate of N692/$1.

However, it closed flat against the greenback in the Investors and Exporters (I&E) segment of the FX market at N429.38/$1 amid a slump in the value of transactions at the ecosystem.

According to data from the FMDQ Securities Exchange, forex transactions worth $63.30 million were carried out during the session compared with the $120.46 million reported a day earlier, indicating a decline by $57.16 million or 47.5 per cent.

But at the interbank segment, the local currency moved in the same direction on Thursday, appreciating against the British Pound Sterling and against the Euro.

It was observed that the domestic currency appreciated against the Pound Sterling by N1.72 to trade at N508.24/£1 compared to the previously traded rate of N509.96/£1 and against the Euro, the Naira gained N11.06 to settle at N420.83/€1 compared with the previous day’s N431.89/€1.

Also, in the black market, the domestic currency improved its value by N2 to trade at N678/$1 in contrast to the N680/$1 it was sold on Wednesday.

Meanwhile, in the cryptocurrency market, investors counted more losses as the appetite for the digital coins waned, with Shiba Inu (SHIB) dropping 9.9 per cent to sell for $0.00001343 and Dogecoin (DOGE) losing 8.4 per cent to close at $0.07429.

Cardano (ADA) depreciated by 8.1 per cent to settle at $0.4951, Solana (SOL) slumped by 6.2 per cent to sell at $38.30, Binance Coin (BNB) slid by 5.0 per cent to close at $291.64, Ripple (XRP) depreciated by 3.7 per cent to finish at $0.3616, Litecoin (LTC) went down by 3.0 per cent to quote at $58.99, Bitcoin (BTC) recorded a 2.5 per cent drop to end at $22,818.66, while Ethereum (ETH) retreated by 1.5 per cent to trade at $1,817.11, with the US Dollar Tether (USDT) retaining its previous day’s value of $1.00 due to the strong performance of the US Dollar against other currencies.

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