Economy
US Stocks Generate Buying Interest on Renewed Trade Talks Optimism
By Investors Hub
The major U.S. index futures are currently pointing to a higher opening on Friday following the volatility seen over the two previous sessions.
The upward momentum on Wall Street comes after U.S. Treasury Secretary Steven Mnuchin reportedly said the U.S. and China are making ?a lot of progress? in trade talks.
A report from Reuters said Mnuchin is looking forward to a meeting with Chinese Vice Premier Liu He next week, which will also include discussions on currency issues.
Traders also seem to be expressing optimism about negotiations to end the government shutdown even though two separate proposals to re-open the government failed in the Senate yesterday.
Overall trading activity may be somewhat subdued, however, as no major U.S. economic data will be released on the day due to the ongoing shutdown.
Extending the volatile performance seen on Wednesday, stocks showed a lack of direction over the course of the trading day on Thursday. The Dow and the S&P 500 spent the day bouncing back and forth across the unchanged line, although the tech-heavy Nasdaq managed to remain positive.
The major averages eventually ended the session mixed. While the Dow edged down 22.38 points or 0.1 percent to 24,553.24, the Nasdaq advanced 47.69 points or 0.7 percent to 7,073.46 and the S&P 500 inched up 3.63 points or 0.1 percent to 2,642.33.
The choppy trading on Wall Street came after Commerce Secretary Wilbur Ross told CNBC the U.S. is “miles and miles” from a trade deal with China.
“Frankly, that shouldn’t be too surprising,” Ross said in an interview on CNBC’s “Squawk Box,” noting the U.S. and China have “lots and lots of issues.”
The comments from Ross come ahead of Chinese Vice Premier Liu He’s trip to Washington next week for the next round of trade negotiations.
Concerns about a U.S.-China trade deal partly offset positive sentiment generated by a report from the Labor Department showing initial jobless claims fell to their lowest level in almost fifty years in the week ended January 19th.
The report said initial jobless claims slid to 199,000, a decrease of 13,000 from the previous week’s revised level of 212,000.
The drop surprised economists, who had expected jobless claims to rise to 220,000 from the 213,000 originally reported for the previous week.
With the unexpected decrease, jobless claims fell to their lowest level since hitting 197,000 in November of 1969.
Meanwhile, a separate report from the Conference Board showed a modest decrease by its index of leading U.S. economic indicators in the month of December.
The Conference Board said its leading economic index edged down by 0.1 percent in December after rising by 0.2 percent in November. The slight drop by the index matched economist estimates.
“The US LEI declined slightly in December and the recent moderation in the LEI suggests that the US economic growth rate may slow down this year,” said Ataman Ozyildirim, Director of Economic Research at the Conference Board.
He added, “While the effects of the government shutdown are not yet reflected here, the LEI suggests that the economy could decelerate towards 2 percent growth by the end of 2019.”
Despite the lackluster performance by the broader markets, semiconductor stocks showed a substantial move to the upside on the day. The Philadelphia Semiconductor Index spiked by 5.7 percent to its best closing level in well over a month.
Shares of Xilinx (XLNX) moved sharply higher after the chipmaker reported better than expected fiscal third quarter results and provided upbeat guidance for the current quarter.
Significant strength was also visible among oil service stocks, as reflected by the 2.2 percent jump by the Philadelphia Oil Service Index. The rally came amid an increase by the price of crude oil.
Computer hardware, housing, and natural gas stocks also saw considerable strength on the day, while tobacco and pharmaceutical stocks showed significant moves to the downside.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange fell by 0.39 per cent on Monday, January 12, after it closed higher in every trading day of last week.
The loss recorded yesterday took out N8.5 billion from the unlisted securities market, closing at N2.184 compared with the preceding session’s closing value of N2.193 trillion.
In the same vein, the NASD Unlisted Security Index (NSI) went down by 14.2 points during the session to 3,651.48 points from the 3,665.68 points it finished last Friday.
The decline was influenced by three securities, with Afriland Properties Plc down by N1.55 to end at N14.75 per unit compared with the previous N16.30 per unit, and NASD Plc declining by N1.00 to N59.00 per share from N6.00 pr share, as Food Concepts Plc slid by 34 Kobo to finish at N3.06 per unit versus N3.40 per unit.
On the flip side, three securities gained weight, with FrieslandCampina Wamco Nigeria Plc appreciating by N6.23 to N68.70 per share from N62.47 per share, Central Securities Clearing System (CSCS) Plc added 45 Kobo to close at N43.07 per unit versus N42.62 per unit, and Geo-Fluids Plc gained 2 Kobo to settle at N6.84 per share versus N6.82 per share.
During the session, the trading volume soared by 826 per cent to 4.03 million units from 434,845 units, the trading value skyrocketed by 579.1 per cent to N46.8 million from N6.9 million, and the number of deals jumped by 118.2 per cent to 48 deals from 22 deals.
When trading activities closed for the day, CSCS Plc remained the most active stock by value on a year-to-date basis with 1.5 million units exchanged for N57.6 million, followed by Geo-Fluids Plc with 6.4 million units valued at N43.3 million, and FrieslandCampina Wamco Nigeria Plc with 379,749 units worth N24.4 million.
In terms of volume, Geo-Fluids Plc led with 6.4 million units sold for N43.3 million, trailed by Industrial and General Insurance (IGI) Plc with 2.9 million units traded for N1.9 million, and CSCS Plc with 1.5 million units valued at N57.6 million.
By Adedapo Adesanya
The Naira appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Monday, January 12 by N1.71 to trade at N1,421.46/$1, in contrast to the preceding session’s N1,423.17/$1.
However, the local currency further depreciated against the Pound Sterling in the same market window yesterday by N3.81 to close at N1,915.84/£1 compared with last Friday’s price of N1,912.03/£1 and lost N3.55 on the Euro to quote at N1,661.68/€1 versus N1,658.13/€1.
In the same vein, the domestic currency depleted against the Dollar at the GTBank FX desk during the trading session by N4 to to settle at N1,431/$1 compared with the previous trading day’s rate of N1,427/$1 and closed flat in the black market at N1,490/$1.
The appreciation of the Nigerian currency against its American counterpart in the official market was supported by foreign portfolio investors’ inflow with support from non-bank corporate supply, leaving it within the N1,350/$1 – N1,450/$1.
“We anticipate that the CBN will emphasise exchange rate stability over rapid appreciation through 2026, supported by prudent policy execution and effective reserve management,” Coronation Merchant Bank research said in an update.
Despite a differential against other currencies, market analysts noted that stronger external inflows from FPIs, improving current account dynamics, and more disciplined FX management by the authorities, will give the Naira stronger footing.
As for the cryptocurrency market, most tokens tracked by this newspaper were largely down with traders seeing the market settle into equilibrium after leverage was flushed and liquidity thinned.
Market analysts noted that with spot demand soft and no clear institutional catalyst, price discovery continues to shift to where thinner liquidity and narrative trades can overwhelm fundamentals.
Litecoin (LTC) lost 4.6 per cent to trade at $76.25, Solana (SOL) depreciated by 1.6 per cent to $140.23, Cardano (ADA) slid by 1.4 per cent to $0.3914, Ripple (XRP) slumped by 0.9 per cent to $2.05, Ethereum (ETH) went down by 0.8 per cent to $3,128.74, and Dogecoin (DOGE) decreased by 0.5 per cent to $0.1392.
On the flip side, Binance Coin (BNB) appreciated by 0.3 per cent to $908.87, and Bitcoin (BTC) increased by 0.1 per cent to $91,916.73, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited kicked off the week on a positive note after it closed higher by 0.58 per cent on Monday amid sustained buying pressure.
The stock market was bullish as a result of bargain-hunting activities across the key sectors of the bourse, with the energy index growing by 1.49 per cent.
Further, the insurance space expanded by 0.88 per cent, the banking counter improved by 0.86 per cent, the industrial goods sector gained 0.81 per cent, the commodity segment soared by 0.79 per cent, and the consumer goods landscape advanced by 0.57 per cent.
Consequently, the All-Share Index (ASI) went up by 946.61 points to 163,244.69 points from 162,298.08 points and the market capitalisation surged by N745 billion to N104.521 trillion from N103.776 trillion.
The market breadth index of Customs Street was positive yesterday with 49 price gainers and 20 price losers, representing a strong investor sentiment.
The quintet of eTranzact, UPDC, McNichols, Red Star Express and RT Briscoe led the gainers’ chart during the session after chalking up 10.00 per cent each to sell for N16.50, N5.50, N6.05, N11.55, and N3.96, respectively.
However, Champion Breweries topped the losers’ table after it shed 8.51 per cent to quote at N15.05, Eunisell shrank by 8.01 per cent to N156.20, Ikeja Hotel crumbled by 8.00 per cent to N36.80, Guinea Insurance depreciated by 7.30 per cent to N1.27, and Omatek moderated by 3.13 per cent to N1.24.
The activity chart had Sovereign Trust Insurance on top after a turnover of 307.5 million shares valued at N1.0 billion, Fidelity Bank followed with 158.4 million equities sold for N3.1 billion, Linkage Assurance traded 118.7 million stocks worth N213.9 million, Mutual Benefits exchanged 31.5 million shares for N130.4 million, and Lasaco Assurance transacted 31.0 million stocks valued at N79.6 million.
At the close of trades, a total of 1.2 billion equities worth N19.2 billion exchanged hands in 59,359 deals versus the 624.1 million equities valued at N18.5 billion traded in 43,816 deals last Friday, showing a spike in the trading volume, value and number of deals by 92.28 per cent, 3.78 per cent, and 35.47 per cent apiece.
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