Economy
Upbeat Jobs Data May Add To Interest Rate Concerns
By Investors Hub
The major U.S. index futures are pointing to a lower opening on Friday, with stocks likely to come under pressure following the mixed performance seen in the previous session.
Concerns about higher interest rates may weigh on Wall Street after the Labor Department released a report showing stronger than expected job growth and a jump in wages.
“Given companies such as WalMart have credited Trump’s tax cuts as a way for them to afford higher worker pay we suspect we will see the wage numbers pick-up further,” said James Knightley, Chief International Economist at ING.
He added, “Consequently, it will need a big shock to prevent the Fed from hiking in March, but it could happen in the form of a damaging government shutdown should politicians fail to resolve their differences.”
Following the modest rebound seen on Wednesday, stocks showed a lack of direction over the course of the trading day on Thursday. The major averages spent much of the day bouncing back and forth across the unchanged line.
Eventually, the major averages ended the session mixed. While the Dow inched up 37.32 points or 0.1 percent to 26,186.71, the Nasdaq fell 25.62 points or 0.4 percent to 7,385.86 and the S&P 500 edged down 1.83 points or 0.1 percent to 2,821.98.
The choppy trading on Wall Street came as traders seemed reluctant to make significant moves ahead of the release of the closely watched monthly jobs report.
Earnings reports due after the close of trading from Google parent Alphabet (GOOGL), Amazon (AMZN) and Apple (AAPL) may also have kept traders on the sidelines.
On the U.S. economic front, a report released by the Labor Department unexpectedly showed a modest decrease in labor productivity in the fourth quarter, although the report also showed a sharp jump in labor costs.
The report said labor productivity edged down by 0.1 percent in the fourth quarter after surging up by a revised 2.7 percent in the third quarter. Economists had expected productivity to climb by 1.0 percent.
Meanwhile, the Labor Department said unit labor costs spiked by 2.0 percent in the fourth quarter after slipping by a revised 0.1 percent in the third quarter. Labor costs were expected to increase by 0.8 percent.
A separate report from the Labor Department showed a slight drop in first-time claims for U.S. unemployment benefits in the week ended January 27th.
The report said initial jobless claims edged down to 230,000, a decrease of 1,000 from the previous week’s revised level of 231,000. Economists had expected jobless claims to rise to 238,000.
The Institute for Supply Management also released a report showing a modest slowdown in the pace of growth in manufacturing activity in the month of January.
The ISM said its purchasing managers index edged down to 59.1 in January from 59.3 in December, although a reading above 50 still indicates growth in the manufacturing sector. Economists had expected the index to dip to 58.8.
Commercial real estate stocks showed a significant move to the downside on the day, resulting in a 2.2 percent slump by the Morgan Stanley REIT Index. With the drop, the index ended the session at its lowest closing level in over a year.
The weakness in the commercial real estate sector likely reflected concerns about the impact of higher interest rates.
Considerable weakness also emerged among retail stocks, as reflected by the 1.7 percent loss posted by the Dow Jones Retail Index.
Alibaba (BABA) posted a steep loss after the China-based online retail giant reported fiscal third quarter earnings that missed expectations.
Utilities and chemical stocks also moved notably lower, while substantial strength was visible among oil service and brokerage stocks.
By Adedapo Adesanya
The duo of Afriland Properties Plc and Geo-Fluids Plc crashed the NASD Over-the-Counter (OTC) Securities Exchange by a marginal 0.06 per cent on Wednesday, December 11 due to profit-taking activities.
The OTC securities exchange experienced a downfall at midweek despite UBN Property Plc posting a price appreciation of 17 Kobo to close at N1.96 per share, in contrast to Tuesday’s closing price of N1.79.
Business Post reports that Afriland Properties Plc slid by N1.14 to finish at N15.80 per unit versus the preceding day’s N16.94 per unit, and Geo-Fluids Plc declined by 1 Kobo to trade at N3.92 per share compared with the N3.93 it ended a day earlier.
At the close of transactions, the market capitalisation of the bourse, which measures the total value of securities on the platform, shrank by N650 million to finish at N1.055 trillion compared with the previous day’s N1.056 trillion and the NASD Unlisted Security Index (NSI) went down by 1.86 points to wrap the session at 3,012.50 points compared with 3,014.36 points recorded in the previous session.
The alternative stock market was busy yesterday as the volume of securities traded by investors soared by 146.9 per cent to 5.9 million units from 2.4 million units, as the value of shares transacted by the market participants jumped by 360.9 per cent to N22.5 million from N4.9 million, and the number of deals increased by 50 per cent to 21 deals from 14 deals.
When the bourse closed for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, followed by Okitipupa Plc with 752.2 million units worth N7.8 billion, and Afriland Properties Plc 297.5 million units sold for N5.3 million.
Also, Aradel Holdings Plc, which is now listed on the Nigerian Exchange (NGX) Limited after its exit from NASD, remained the most active stock by value (year-to-date) with 108.7 million units sold for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units worth N5.3 billion.
By Adedapo Adesanya
The euphoria around the recent appreciation of the Naira eased on Wednesday, December 11 after its value shrank against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N5.23 or 0.3 per cent to N1,547.50/$1 from the N1,542.27/$1 it was valued on Tuesday.
It was observed that spectators’ activities may have triggered the weakening of the local currency in the official market at midweek as they tried to fight back and ensure the value of funds in foreign currencies strengthened.
The domestic currency was regaining its footing after the Central Bank of Nigeria (CBN) launched an Electronic Foreign Exchange Matching System (EFEMS) platform to tackle speculation and improve transparency in Nigeria’s FX market.
At midweek, the Nigerian currency depreciated against the Pound Sterling by N3.56 to close at N1,958.68/£1 compared with the preceding day’s N1,955.12/£1 and against the Euro, it slumped by 34 Kobo to trade at N1,612.66/€1, in contrast to the previous session’s N1,613.00/€1.
As for the black market segment, the Naira lost N45 against the American currency during the session to quote at N1,670/$1 compared with the N1,625/$1 it was traded a day earlier.
A look at the cryptocurrency market showed a recovery following profit-taking as the US Consumer Price Index report matched economist forecasts.
The news was enough to convince traders that the Federal Reserve is certain to trim its benchmark fed funds rate another 25 basis points at its meeting next week.
The move also saw Bitcoin (BTC), the most valued coin, return to the $100,000 mark as it added a 2.9 per cent gain and sold for $100,566.12.
The biggest gainer was Cardano (ADA), which jumped by 15.00 per cent to trade at $1.16, as Litecoin (LTC) appreciated by 10.4 per cent to sell for $121.76, and Ethereum (ETH) surged by 7.0 per cent to $3,929.30, while Dogecoin (DOGE) recorded a 6.7 per cent growth to finish at $0.4181.
Further, Binance Coin (BNB) went up by 5.2 per cent to $716.72, Solana (SOL) expanded by 4.6 per cent to $229.77, and Ripple (XRP) increased by 4.2 per cent to $2.43, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
By Aduragbemi Omiyale
The Dangote Refinery located in the Lekki area of Lagos State has made its first export of premium motor spirit (PMS) just three months after it commenced the production of petrol.
In September 2024, the refinery produced its first petrol and began loading to the Nigerian National Petroleum Company (NNPC) on September 15.
However, due to some issues, the facility has not been able to flood the local market with its product, forcing it to look elsewhere.
In a landmark move for regional energy integration, Dangote Refinery has partnered with Neptune Oil to take its petrol to neighbouring Cameroon.
Neptune Oil is a leading energy company in Cameroon which provides reliable and sustainable energy solutions.
Dangote Refinery said this development showcases its ability to meet domestic needs and position itself as a key player in the regional energy market, adding that it represents a significant step forward in accessing high-quality and locally sourced petroleum products for Cameroon.
“This first export of PMS to Cameroon is a tangible demonstration of our vision for a united and energy-independent Africa.
“With this development, we are laying the foundation for a future where African resources are refined and exchanged within the continent for the benefit of our people,” the owner of Dangote Refinery, Mr Aliko Dangote, said.
His counterpart at Neptune Oil, Mr Antoine Ndzengue, said, “This partnership with Dangote Refinery marks a turning point for Cameroon.
“By becoming the first importer of petroleum products from this world-class refinery, we are bolstering our country’s energy security and supporting local economic development.
“This initial supply, executed without international intermediaries, reflects our commitment to serving our markets independently and efficiently.”
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