Economy

US Stock Markets Open Lower as Fed Considers One More Rate Hike

Published

7 years ago

18/10/2018

By Investors Hub

The major U.S. index futures are pointing to a lower opening on Thursday, with stocks likely to move to the downside after ending the previous session roughly flat.

Lingering concerns about the outlook for interest rates may weigh on the markets as traders continue to digest the minutes of the Federal Reserve?s latest monetary policy meeting.

The minutes released Wednesday afternoon showed the Fed continues to favor a ?gradual approach? to raising interest rates, with the meeting participants generally judging that the economy was evolving about as anticipated.

The Fed?s forecasts point to one more rate hike before the end of this year, with CME Group?s FedWatch indicating a nearly 80 percent chance of a quarter-point rate increase in December.

After recovering from an early move to the downside, stocks showed a lack of direction over the course of afternoon trading on Wednesday. The major averages spent the afternoon bouncing back and forth across the unchanged line.

The major averages eventually ended the day in negative territory. While the Dow fell 91.74 points or 0.4 percent to 25,706.68, the Nasdaq slipped 2.79 points or less than a tenth of a percent to 7,642.70 and the S&P 500 edged down 0.71 points or less than a tenth of a percent to 2,809.21.

The lackluster performance in the afternoon came after the Federal Reserve released the minutes of its September monetary policy meeting.

The Fed argued the “gradual approach” would balance the risk of raising rates too quickly, causing a slowdown in the economy, and raising rates too slowly, leading to inflation above the central bank’s 2 percent objective.

Looking ahead, the minutes said a few meeting participants expected rates would need to become modestly restrictive for a time.

A number of participants also determined it would be necessary to temporarily raise rates above the longer-run level in order to reduce the risk of a sustained overshooting of the Fed’s inflation target.

Meanwhile, a couple of participants indicated they would not favor adopting a restrictive policy stance in the absence of clear signs of an overheating economy and rising inflation.

During the meeting, the Fed decided to raise rates by a quarter point for a third time this year to 2 to 2.25 percent and forecast another rate hike before the end of the year. The central bank’s forecasts also pointed to three rate hikes in 2019.

The Fed’s assessment that the “gradual approach” to raising rates remains appropriate comes even as President Donald Trump has repeatedly attacked the central bank for hiking rates too quickly.

Trump continued his assault on the Federal Reserve in an interview with Fox Business on Tuesday, calling the central bank the “biggest threat” to his presidency.

Profit taking contributed to the early weakness on Wall Street, as traders cashed in on yesterday’s gains amid lingering uncertainty about the near-term outlook for the markets.

A negative reaction to the latest batch of earnings news also weighed on the markets, with tech giant IBM Corp. (IBM) falling after reporting third quarter earnings that beat analyst estimates but weaker than expected revenues.

On the other hand, shares of Netflix (NFLX) surged higher after the video streaming service reported better than expected third quarter earnings, revenues, and subscriber growth.

Negative sentiment was also generated by the release of a report from the Commerce Department showing a much bigger than expected pullback in housing starts in the month of September.

Despite the recovery attempt by the broader markets, housing stocks ended the day significantly lower. The Philadelphia Housing Sector Index tumbled by 1.9 percent after jumping by 2.4 percent in the previous session.

Housing stocks pulled back after moving higher for three straight sessions, with the disappointing housing starts data weighing on the sector.

Considerable weakness was also visible among energy stocks, which moved lower along with the price of crude oil. Reflecting the weakness in the energy sector, the NYSE Arca Natural Gas Index slumped by 1.6 percent, the Philadelphia Oil Service Index dropped by 1.4 percent and the NYSE Arca Oil Index fell by 1.1 percent.

On the other hand, tobacco stocks showed a substantial move to the upside on the day, driving the NYSE Arca Tobacco Index up by 1.6 percent. The index rebounded after closing lower for five consecutive sessions.

Economy

Customs Street Chalks up 1.08% on Renewed Buying Pressure

Published

2 minutes ago

06/12/2025

Dipo Olowookere

By Dipo Olowookere

A 1.08 per cent growth was further printed by the Nigerian Exchange (NGX) Limited on Friday on improved appetite for Nigerian stocks.

Data showed that the insurance sector lost 0.61 per cent yesterday due to profit-taking as the energy space gave up 0.08 per cent, while the commodity counter closed flat.

However, the industrial goods landscape appreciated by 2.06 per cent, the banking index improved by 1.31 per cent, and the consumer goods sector expanded by 0.83 per cent.

At the close of business on Customs Street, the All-Share Index (ASI) increased by 1,563.92 points to 147,040.07 points from 145,476.15 points and the market capitalisation went up by N996 billion to N93.722 trillion from N92.726 trillion.

UAC Nigeria led the advancers’ log yesterday after it grew by 10.00 per cent to N96.80, Transcorp Hotels jumped by 9.71 per cent to N172.80, Royal Exchange appreciated by 8.89 per cent to N1.96, Ikeja Hotel soared by 8.74 per cent to N31.10, and Veritas Kapital leapt by 8.07 per cent to N1.74.

On the flip side, Union Dicon declined by 10.00 per cent to N6.30, ABC Transport slipped by 9.88 per cent to N3.10, AXA Mansard depreciated by 7.19 per cent to N12.90, FTN Cocoa lost 4.62 per cent to trade at N4.75, and Guinea Insurance dropped 3.36 per cent to finish at N1.15.

A total of 38 stocks ended on the gainers’ table and 17 stocks finished on the losers’ table, representing a positive market breadth index and strong investor sentiment.

Traders transacted 361.6 million equities for N14.8 billion in 21,051 deals yesterday versus the 1.9 billion equities worth N19.2 billion traded in 23,369 deals a day earlier, showing a decline in the trading volume, value, and number of deals by 80.97 per cent, 22.92 per cent, and 14.20 per cent, respectively.

The busiest stock for the session was Zenith Bank with 59.5 million units worth N3.6 billion, Access Holdings traded 46.1 million units valued at N973.0 million, Fidelity Bank exchanged 29.4 million units for N560.4 million, FCMB transacted 27.9 million units worth N293.9 million, and Tantalizers sold 13.0 million units valued at N29.8 million.

Economy

Nipco, 11 Plc Crash OTC Securities Exchange by 4.76%

Published

1 hour ago

06/12/2025

Adedapo Adesanya

By Adedapo Adesanya

Energy stocks influenced the 4.76 per cent loss recorded by the NASD Over-the-Counter (OTC) Securities Exchange on Friday, December 5.

The culprits were the duo of 11 Plc and Nipco Plc,with the former shedding N32.17 to end at N291.83 per share compared with the previous day’s N324.00 per share, and the latter down by N21.00 to sell at N195.00 per unit versus the previous session’s N216.00 per unit.

Consequently, the NASD Unlisted Security Index (NSI) slumped by 170.16 points to 3,401.37 points from 3,571.53 points and the market capitalisation lost N101.81 billion to close at N2.035 billion from the N2.136 trillion quoted in the preceding session.

The OTC securities exchange suffered the decline yesterday despite the share prices of three companies closing green.

Central Securities Clearing System (CSCS) Plc was up by N1.80 to close at N39.80 per share compared with Thursday’s price of N38.00 per share, Air Liquide Plc appreciated by N1.09 to N11.99 per unit from N10.90 per unit, and FrieslandCampina Wamco Nigeria Plc grew by 78 Kobo to N56.57 per share from N55.79 per share.

During the session, the volume of transactions rose by 6,885.3 per cent to 18.2 million units from 4.3 million units, the value of transactions ballooned by 10,301.7 per cent to N389.7 million from N347.2 million, but the number of deals declined by 29.7 per cent to 26 deals from 37 deals.

Infrastructure Credit Guarantee Company (InfraCredit) Plc ended the day as the most traded stock by value on a year-to-date basis with 5.8 billion units worth N16.4 billion, followed by Okitipupa Plc with 170.4 million units valued at N8.0 billion, and Air Liquide Plc with 507.5 million units worth N4.2 billion.

InfraCredit Plc also finished the day as the most traded stock by volume on a year-to-date basis with 5.8 billion units transacted for N16.4 billion, followed by Industrial and General Insurance (IGI) Plc with 1.2 billion units sold for N420.2 million, and Impresit Bakolori Plc with 536.9 million units worth N524.9 million.

Economy

Naira Depreciates to N1,450/$1 at Official Forex Market

Published

1 hour ago

06/12/2025

Adedapo Adesanya

By Adedapo Adesanya

The Naira depreciated further against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, December 5, as FX demand pressure mounts.

The Nigerian currency lost N2.60 or 0.18 per cent against the greenback to close at N1,450.43/$1 compared with the previous day’s N1,447.83/$1.

Equally, the domestic currency declined against the Pound Sterling in the official forex market during the session by N4.48 to trade at N1,935.45/£1, in contrast to Thursday’s closing price of N1,930.97/£1 and shrank against the Euro by 43 Kobo to end at N1,689.17/€1 versus the preceding session’s rate of N1,688.74/€1.

Similarly, the local currency performed badly against the US Dollar at the GTBank FX counter by N2 to close at N1,455/$1 versus Thursday’s N1,453/$1 but traded flat at the parallel market at N14.65/$1.

As the country gets into the festive period, pressure mounted on the local currency reflecting higher foreign payments and lower FX inflows.

However, there are expectations that the Nigerian currency will be stable, supported by interventions by to the Central Bank of Nigeria (CBN) in the face of steady dollar Demand and inflows from Detty December festivities that will give the Naira a boost after it depreciated mildly last month.

Traders cited by Reuters expect that the Naira will trade within a band of N1,443-N1,450/$1 next week, buoyed by improved FX interventions by the apex bank.

As for the crypto market, it was down yesterday due to profit-taking associated with year-end trading. However, the December 1-Year Consumer Inflation Expectation by the University of Michigan fell to 4.1 per cent from 4.5 per cent previously and 4.5 per cent expected. The 5-Year Consumer Inflation Expectation fell to 3.2 per cent from 3.4 per cent previously and 3.4 per cent expected.

With the dearth of official economic data of late, these private surveys have taken on a new level of significance and the market banks of them to make decisions.

Cardano (ADA) depreciated by 5.7 per cent to $0.4142, Dogecoin (DOGE) slid by 5.1 per cent to $0.1394, Ethereum (ETH) dropped by 3.9 per cent to $3,039.75, Solana (SOL) declined by 3.8 per cent to $133.24, and Litecoin (LTC) fell by 3.7 per cent to $80.59.

Further, Bitcoin (BTC) went down by 2.6 per cent to sell at $89,683.72, Binance Coin (BNB) slumped by 2.2 per cent to $883.59, and Ripple (XRP) shrank by 2.1 per cent to $2.04, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.