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Economy

US Stocks Open Lower on Threat Of New Tariffs

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US Stocks report

By investors Hub

The major U.S. index futures are currently pointing to a lower opening on Friday, with stocks likely to come under pressure after ending the previous session modestly higher.

Trade concerns are likely to weigh on the markets once again after President Donald Trump revealed plans to use tariffs to compel Mexico to make efforts to stop flow of illegal immigrants across the country and into the U.S.

?On June 10th, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP,? Trump announced in a post on Twitter

He added, ?The Tariff will gradually increase until the Illegal Immigration problem is remedied, at which time the Tariffs will be removed.?

Trump revealed in a subsequent White House statement the tariffs will be raised to 10 percent on July 1st if the crisis persists, with tariffs eventually rising as high as 25 percent by October 1st.

The president argued the sustained imposition of tariffs will produce a massive return of jobs back to U.S., describing the move as an effort to ?firmly and forcefully? stand up for America?s interests.

?We have confidence that Mexico can and will act swiftly to help the United States stop this long-term, dangerous, and deeply unfair problem,? Trump said.

?The United States has been very good to Mexico for many years,? he added. ?We are now asking that Mexico immediately do its fair share to stop the use of its territory as a conduit for illegal immigration into our country.?

The threat of new tariffs on Mexican imports comes amid the escalating trade dispute between the U.S. and China, which has recently weighed on stocks and raised concerns about the global economic outlook.

After failing to sustain an early move to the upside, stocks fluctuated over the course of the trading session on Thursday. The major averages spent a good part of the day bouncing back and forth across the unchanged line.

Eventually, the major averages closed in positive territory but well off their best levels of the day. The Dow rose 43.47 points or 0.2 percent to 25,169.88, the Nasdaq climbed 20.41 points or 0.3 percent to 7,567.72 and the S&P 500 edged up 5.84 points or 0.2 percent to 2,788.86.

The early strength on Wall Street partly reflected bargain hunting following recent weakness, with the Dow bouncing off its lowest closing level in well over three months.

An early rebound by treasury yields also contributed to the upward move, as a recent decline by yields has led to concerns about the outlook for the economy and the possibility of a recession.

Buying interest waned shortly after the start of trading, however, as traders seemed reluctant to get back into the markets due to lingering concerns about the U.S.-China trade dispute.

Amid a continued escalation of the rhetoric, Chinese Vice Foreign Minister Zhang Hanhui accused the U.S. of “economic terrorism” by raising tariffs on Chinese goods.

“We oppose a trade war but are not afraid of a trade war,” Zhang said. “This kind of deliberately provoking trade disputes is naked economic terrorism, economic homicide, economic bullying.”

A report from Bloomberg News indicating China has put purchases of U.S. soybeans on hold has added to concerns about a trade war.

Treasuries also turned higher over the course of the trading session, contributing to a notable downturn by yields.

On the U.S. economic front, the Labor Department released a report showing a modest uptick in first-time claims for U.S. unemployment benefits in the week ended May 25th.

The report said initial jobless claims edged up to 215,000, an increase of 3,000 from the previous week’s revised level of 212,000.

A separate report from the Commerce Department showed U.S. economic growth in the first quarter accelerated by slightly less than initially estimated.

The Commerce Department said real gross domestic product surged up by 3.1 percent in the first quarter, reflecting a slight downward from revision from the previously reported 3.2 percent jump.

The downwardly revised increase in GDP, which matched economist estimates, still represented a notable acceleration from the 2.2 percent growth seen in the fourth quarter of 2018.

Meanwhile, the National Association of Realtors released a report showing pending home sales unexpectedly pulled back in the month of April.

NAR said its pending home sales index tumbled by 1.5 percent to 104.3 in April after surging up by 3.9 percent to an upwardly revised 105.9 in March.

The pullback came as a surprise to economists, who had expected pending home sales to climb by 0.9 percent compared to the 3.8 percent jump originally reported for the previous month.

Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.

Energy stocks showed a significant move to the downside, however, with a steep drop by the price of crude oil weighing on the sector.

Reflecting the weakness in the energy sector, the NYSE Arca Natural Gas Index tumbled by 2 percent, the Philadelphia Oil Service Index slumped by 1.7 and the NYSE Arca Oil Index fell by 1.3 percent.

Banking stocks also came under pressure over the course of the trading session, dragging the KBW Bank Index down by 1.3 percent.

On the other hand, gold stocks moved higher along with the price of the precious metal, with the NYSE Arca Gold Bugs Index jumping by 1.8 percent.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via [email protected]

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Economy

Six Securities Raise NASD OTC Exchange by 0.99%

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NASD OTC exchange

By Adedapo Adesanya

The NASD Over-the-Counter (OTC) Securities Exchange rose by 0.99 per cent on Thursday, February 6, boosted by price appreciation in the six stocks.

The NASD Unlisted Security Index (NSI) went up by 31.02 points during the trading session to 3,171.57 points, in contrast to the midweek’s 3,140.55 points, and the market capitalisation increased by N17.57 billion to close at N1.796 trillion compared with the previous day’s N1.779 trillion.

Okitipupa Plc added N8.44 to its value yesterday to finish at N93.30 per unit versus N84.86 per unit, Central Securities Clearing System (CSCS) Plc gained N1.78 to wrap the day at N23.78 per share compared with N22.00 per share, and Afriland Properties Plc went up by N1.24 to N17.49 per unit from N16.25 per unit.

Further, Mixta Real Estate Plc expanded by 15 Kobo to finish at N3.11 per share versus the preceding session’s N2.96 per share, FrieslandCampina Wamco Nigeria Plc grew by N1.61 to N39.50 per unit from N37.89 per unit, and  UBN Property Plc rose by 2 Kobo to close at N2.22 per share, in contrast to midweek’s N2.20 per share.

During the trading day, the volume of securities bought and sold by investors increased by 19.3 per cent to 12.0 million units from 10.1 million units, the value of securities soared by 5.1 per cent to N14.2 million from N13.5 million, and the number of deals surged by 152.9 per cent to 43 deals from 17 deals.

Impresit Bakolori Plc ended the session as the most active stock by value (year-to-date) with 519.5 million units worth N504.3 million, followed by FrieslandCampina Wamco Nigeria Plc with 6.2 million units valued at N245.0 million, and Geo-Fluids Plc with 9.3 million units sold for N44.8 million.

Also, Impresit Bakolori Plc remained the most active stock by volume (year-to-date) with 519.5 million units worth N504.3 million, trailed by Industrial and General Insurance (IGI) Plc with 42.4 million units sold for N12.9 million, and Geo-Fluids Plc with 9.3 million units valued at N44.8 million.

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Economy

Naira Falls to N1,500/$1 at Official Market, Appreciates to N1,570/$1 at Black Market

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paying remittances in Naira

By Adedapo Adesanya

For the fourth consecutive trading session, the value of the Nigerian currency, the Naira, depreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday by 0.06 per cent or N89 Kobo to trade at N1,500.65/$1 compared with the previous day’s value of N1,499.76/$1.

However, the Naira improved its value against the Pound Sterling in the official market yesterday by N8.19 to sell for N1,859.98/£1 compared with Wednesday’s closing price of N1,868.17/£1, but against the Euro, the local currency depreciated by N1.77 to settle at N1,555.18/€1, in contrast to midweek’s value of nN1,553.41/€1.

At the black market, the local currency gained N20 against the greenback during the session to quote at N1,570/$1 versus the N1,590/$1 it was traded a day earlier.

In the cryptocurrency market, it was majorly red on Thursday due to profit-taking as the US Securities and Exchange Commission took the first step toward allowing new crypto exchange-traded funds (ETFs) tracking the price of assets like Litecoin and Solana, as well as new ways of redeeming funds from existing crypto ETFs.

Meanwhile, companies took another step toward launching Ripple (XRP) ETFs in a further sign of the new crypto-friendlier administration at the agency.

Data indicated that Cardano (ADA) went down by 5.1 per cent to trade at $0.7169, Solana (SOL) slumped by 4.8 per cent to finish at $192.63, and Dogecoin (DOGE) depreciated by 4.5 per cent to sell at $0.2509.

In addition, Ethereum (ETH) went down by 4.3 per cent to close at $2,713.47, Ripple (XRP) weakened by 3.6 per cent to end at $2.36, Litecoin (LTC) retreated by 1.9 per cent to close at $103.95, and Bitcoin (BTC) dipped by 0.5 per cent to sell for $97,344.70.

However, the price of Binance Coin (BNB) went up by 0.4 per cent to trade at $579.91, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 apiece.

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Economy

Buying Pressure Buoys NGX All-Share Index by 0.10%

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All-Share Index NGX

By Dipo Olowookere

The Nigerian Exchange (NGX) Limited witnessed continued buying interest from offshore and domestic investors on Thursday, strengthening the market further by 0.10 per cent at the close of transactions.

Data revealed that the All-Share Index (ASI) was up by 105.26 points yesterday to 105,430.15 points from the preceding day’s 105,324.89 points, and the market capitalisation expanded by N65 billion to close at N65.287 trillion compared with the previous session’s N65.222 trillion.

Business Post observed that the market participants showed interest in equities across the key sectors of the exchange because of their prospects to yield better value later.

The insurance counter gained 0.63 per cent, the consumer goods index appreciated by 0.18 per cent, the energy index improved by 0.13 per cent, the banking space jumped by 0.09 per cent, and the industrial goods industry grew by 0.04 per cent.

Eterna chalked up 9.88 per cent to trade at N33.35, Cadbury Nigeria also gained 9.88 per cent to finish at N26.70, Fidson increased its value by 9.77 per cent to N19.10, UPDC rose by 9.77 per cent to N2.36, and Deap Capital soared by 9.38 per cent to N1.05.

On the flip side, Tripple G lost 9.72 per cent to end at N2.23, Golden Breweries receded by 8.91 per cent to N7.87, Veritas Kapital slumped by 7.81 per cent to N1.18, Caverton dipped by 5.53 per cent to N2.05, and Regency Alliance slipped by 4.05 per cent to 71 Kobo.

When the bourse closed for the session, there were 33 price advancers and 23 price decliners, indicating a positive market breadth index and strong investor sentiment.

Yesterday, investors bought and sold 537.2 million shares valued at N23.0 billion in 15,450 deals versus the 1.1 billion shares worth N28.8 billion traded in 15,080 deals on Wednesday, representing a rise in the number of deals by 2.45 per cent, and a decline in the trading volume and value by 49.19 per cent and 20.14 per cent, respectively.

Access Holdings led the activity log with 61.6 million stocks valued at N1.7 billion, Sterling Holdings exchanged 50.2 million equities for N296.2 million, Zenith Bank traded 40.5 million shares worth N2.0 billion, FBN Holdings sold 38.8 million equities valued at N1.3 billion, and UPDC transacted 23.6 million stocks worth N54.4 million.

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