Economy
Upbeat Earnings, Economic News May Fortify US Stocks
By Investors Hub
The major U.S. index futures are pointing to a higher opening on Monday, with stocks poised to add to the strong gains posted last week.
Early buying interest may be generated in reaction to upbeat quarterly results from financial giant Bank of America (BAC), which reported first quarter earnings that beat analyst estimates on strong loan growth.
The markets may also benefit from the release of a Commerce Department report showing stronger than expected retail sales growth in the month of March.
Geopolitical concerns may keep trading activity somewhat subdued, however, as traders digest the weekend?s U.S.-led airstrikes against Syria.
Reports of the U.S. imposing new economic sanctions on Russia and a tweet from President Donald Trump accusing China of currency devaluation may also limit any upside for the markets.
After failing to sustain an initial upward move, stocks moved mostly lower over the course of the trading session on Friday. With the downturn on the day, the major averages partly offset the gains posted in the previous session.
The major averages climbed off their worst levels going into the close but still ended the day in the red. The Dow slid 122.91 points or 0.5 percent to 24,360.14, the Nasdaq dropped 33.60 points or 0.5 percent to 7,106.65 and the S&P 500 fell 7.69 points or 0.3 percent to 2,656.30.
Despite the pullback on the day, the major averages moved sharply higher for the week. The Nasdaq soared by 2.8 percent, while the S&P 500 and the Dow jumped by 2 percent and 1.8 percent, respectively.
The initial strength on Wall Street came as traders reacted positively to earnings news from financial giants JPMorgan Chase (JPM), Citigroup (C), and Wells Fargo (WFC).
Before the start of trading, JPMorgan, Citigroup, and Wells Fargo all reported first quarter earnings that came in above analyst estimates.
Buying interest waned shortly after the open, however, with traders reluctant to make significant moves ahead of a slew of earnings news next week.
Bank of America (BAC), Goldman Sachs (GS), Johnson & Johnson (JNJ), IBM (IBM), American Express (AXP), and General Electric (GE) are among the companies due to report their quarterly results.
The subsequent pullback by the markets may have been partly due to the release of a report from the University of Michigan showing a bigger than expected drop in consumer sentiment in the month of April.
The report said the preliminary reading on the consumer sentiment index for April came in at 97.8 compared to the final March reading of 101.4. Economists had expected the index to edge down to 100.5.
“Consumer sentiment slipped in early April, largely reversing the gains recorded in the prior two months,” said Richard Curtin, the survey’s chief economist. “The small decline was widely shared by all age and income subgroups and across all regions of the country.”
He added, “Importantly, confidence still remains relatively high, despite the recent losses that were mainly due to concerns about the potential impact of Trump’s trade policies on the domestic economy.”
Banking stocks showed a significant move to the downside on the day, dragging the KBW Bank Index down by 2.1 percent. JPMorgan, Citigroup, and Wells Fargo all slid into negative territory despite reporting better than expected earnings.
Considerable weakness was also visible among brokerage stocks, as reflected by the 1.1 percent loss posted by the NYSE Arca Broker/Dealer Index.
On the other hand, gold stocks moved notably higher, driving the NYSE Arca Gold Bugs Index up by 1.7 percent. The index ended the session at its best closing level in nearly two months. The rally by gold stocks came amid an increase by the price of the precious metal.
By Modupe Gbadeyanka
The federal government, the 36 states of the federation and the 774 local government areas have received N1.727 trillion from the Federal Accounts Allocation Committee (FAAC) for December 2024.
The funds were disbursed to the three tiers of government from the revenue generated by the nation in November 2024.
At the December meeting of FAAC held in Abuja, it was stated that the amount distributed comprised distributable statutory revenue of N455.354 billion, distributable Value Added Tax (VAT) revenue of N585.700 billion, Electronic Money Transfer Levy (EMTL) revenue of N15.046 billion and Exchange Difference revenue of N671.392 billion.
According to a statement signed on Friday by the Director of Press and Public Relations for FAAC, Mr Bawa Mokwa, the money generated last month was about N3.143 trillion, with N103.307 billion used for cost of collection and N1.312 trillion for transfers, interventions and refunds.
It was disclosed that gross statutory revenue of N1.827 trillion was received compared with the N1.336 trillion recorded a month earlier.
The statement said gross revenue of N628.972 billion was available from VAT versus N668.291 billion in the preceding month.
The organisation stated that last month, oil and gas royalty and CET levies recorded significant increases, while excise duty, VAT, import duty, Petroleum Profit Tax (PPT), Companies Income Tax (CIT) and EMTL decreased considerably.
As for the sharing, FAAC disclosed that from the N1.727 trillion, the central government got N581.856 billion, the states received N549.792 billion, the councils took N402.553 billion, while the benefiting states got N193.291 billion as 13 per cent derivation revenue.
From the N585.700 billion VAT earnings, the national government got N87.855 billion, the states received N292.850 billion and the local councils were given N204.995 billion.
Also, from the N455.354 billion distributable statutory revenue, the federal government was given N175.690 billion, the states got N89.113 billion, the local governments had N68.702 billion, and the benefiting states received N121.849 billion as 13 per cent derivation revenue.
In addition, from the N15.046 billion EMTL revenue, FAAC shared N2.257 billion to the federal government, disbursed N7.523 billion to the states and transferred N5.266 billion to the local councils.
Further, from the N671.392 billion Exchange Difference earnings, it gave central government N316.054 billion, the states N160.306 billion, the local government areas N123.590 billion, and the oil-producing states N71.442 billion as 13 per cent derivation revenue.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
By Adedapo Adesanya
The Naira appreciated further against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N1.50 or 0.09 per cent to close at N1,533.00/$1 on Friday, December 13 versus the N1,534.50/$1 it was transacted on Thursday.
The local currency has continued to benefit from the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) this month.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.
The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN.
Market analysts say the publication of real-time prices and buy-sell orders data from this system has lent support to the Naira in the official market and tackled speculation.
In the official market yesterday, the domestic currency improved its value against the Pound Sterling by N12.58 to wrap the session at N1,942.19/£1 compared with the previous day’s N1,954.77/£1 and against the Euro, it gained N2.44 to close at N1,612.85/€1 versus Thursday’s closing price of N1,610.41/€1.
At the black market, the Nigerian Naira appreciated against the greenback on Friday by N30 to sell for N1,650/$1 compared with the preceding session’s value of N1,680/$1.
Meanwhile, the cryptocurrency market was largely positive as investors banked on recent signals, including fresh support from US President-elect, Mr Donald Trump, as well as interest rate cuts by the European Central Bank (ECB).
Ripple (XRP) added 7.3 per cent to sell at $2.49, Binance Coin (BNB) rose by 3.5 per cent to $728.28, Cardano (ADA) expanded by 2.4 per cent to trade at $1.11, Litecoin (LTC) increased by 2.3 per cent to $122.56, Bitcoin (BTC) gained 1.9 per cent to settle at $101,766.17, Dogecoin (DOGE) jumped by 1.2 per cent to $0.4064, Solana (SOL) soared by 0.7 per cent to $226.15 and Ethereum (ETH) advanced by 0.6 per cent to $3,925.35, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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