Economy
Veterans Day Holiday May Lead to Choppy Trading on Wall Street
By Investors Hub
The major U.S. index futures are pointing to a lower open on Monday, with stocks likely to see further downside after moving notably lower last Friday.
Lingering concerns about the outlook for global economic growth and a continued increase in interest rates may contribute to early weakness on Wall Street.
Government officers, the bond markets, and most banks are closed in observance of Veterans Day, however, potentially leading to limited trading activity.
A lack of major U.S. economic data may also keep some traders on the sidelines, contributing to a relatively choppy trading day.
In the coming days, traders are likely to keep a close eye on reports on consumer price inflation, retail sales, and industrial production.
A speech by Federal Reserve Chairman Jerome Powell on Wednesday is also likely to attract attention, as traders look for additional clues about the outlook for interest rates.
Last week, the Fed left interest rates unchanged as widely expected but indicated it remains on track to gradually raise rates despite signs of a slowdown in the pace of growth in business investment.
CME Group’s FedWatch tool currently indicates a nearly 76 percent chance the Fed will raise rates by a quarter point following a two-day meeting scheduled for December 18th and 19th.
Following the mixed performance seen on Thursday, stocks moved mostly lower during the trading day on Friday. With the drop on the day, the Dow pulled back off its best closing level in a month.
The major averages climbed well off their worst levels of the day but remained firmly in negative territory. The Dow fell 201.92 points or 0.8 percent to 25,989.30, the Nasdaq tumbled 123.98 points or 1.7 percent to 7,406.90 and the S&P 500 slid 25.82 points or 0.9 percent to 2,781.01.
Despite the pullback on the day, the major averages all moved higher for the week. The Dow surged up by 2.8 percent, the S&P 500 jumped by 2.1 percent and the Nasdaq climbed by 0.7 percent.
The weakness on Wall Street partly reflected renewed concerns about the outlook for interest rates on the heels of the Federal Reserve’s monetary policy announcement on Thursday.
The Fed left interest rates unchanged as widely expected but indicated it remains on track to gradually raise rates despite signs of a slowdown in the pace of growth in business investment.
Adding to the concerns about interest rates, the Labor Department released a report showing a much bigger than expected increase in producer prices in the month of October.
The Labor Department said its producer price index for final demand climbed by 0.6 percent in October after rising by 0.2 percent in September. Economists had been expecting another 0.2 percent uptick.
Excluding food and energy prices, core producer prices still rose by 0.5 percent in October after edging up by 0.2 percent in September. Core prices had been expected to rise by another 0.2 percent.
Compared to the same month a year ago, producer prices in October were up by 2.9 percent, reflecting an acceleration from the 2.6 percent increase in September.
The annual rate of growth in core consumer prices also accelerated modestly to 2.6 percent in October from 2.5 percent in September.
“Overall, the producer prices data show that inflationary pressures remain fairly strong, which will keep the Fed hiking rates once a quarter in the near term,” said Andrew Hunter, U.S. Economist at Capital Economics.
A separate report from the University of Michigan showed a slight deterioration in consumer sentiment in the month of November.
The report said the consumer sentiment index edged down to 98.3 in November from the final October reading of 98.6. Economists had expected the index to dip to 98.0.
Extending a recent sell-off, tobacco stocks moved sharply lower over the course of the session, dragging the NYSE Arca Tobacco Index down by 3.5 percent. The index tumbled to its lowest closing level in well over two months.
The steep drop by tobacco stocks was partly due to a report from the Wall Street Journal indicating FDA Commissioner Scott Gottlieb plans to pursue a ban on menthol cigarettes.
Substantial weakness was also visible among biotechnology stocks, as reflected by the 2.8 percent slump by the NYSE Arca Biotechnology Index.
Steel stocks also saw considerable weakness amid concerns about the outlook for global demand, with the NYSE Arca Steel Index plunging by 2.5 percent.
Technology, gold, retail and brokerage stocks also showed notable moves to the downside, reflecting broad based weakness on Wall Street.
By Adedapo Adesanya
The Central Securities Clearing System (CSCS) Plc again pulled down the NASD Over-the-Counter (OTC) Securities Exchange on Thursday, August 20, by 1.11 per cent.
The securities depository company further lost N5.93 during the trading session to close at N82.20 per share versus the midweek closing price of N88.12 per share.
As a result, the NASD Security Index (NSI) slid by 48.25 points to 4,284.84 points from 4,333.09 points, and trimmed the bourse’s market capitalisation by N28.96 billion to N2.571 trillion from N2.60 trillion.
During the trading day, the price of Afriland Properties Plc went up by 50 Kobo to N20.50 per unit from N20.00 per unit.
Yesterday, the volume of securities transacted by investors slumped by 85.1 per cent to 112,218 units from 747,429 units, the value of securities fell by 95.2 per cent to 4.6 million from 9.4 million, and the number of deals decreased by 40.5 per cent to 25 deals from 42 deals.
Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units valued at N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units exchanged for N6.5 billion, and CSCS Plc with 79.9 million units worth N5.8 billion.
GNI Plc also finished the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units transacted for N8.4 billion, followed by Infracredit Plc with 2.3 billion units traded for N6.5 billion, and Resourcery Plc with 1.1 billion units sold for N415.7 million.
By Adedapo Adesanya
The Naira improved its value against the United States Dollar by N2.78 or 0.21 per cent to N1,347.63/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEM) on Thursday, August 20, from the previous day’s N1,350.41/$1.
Also, the domestic currency gained 43 Kobo against the Pound Sterling in the official market yesterday to trade at N1,838.70/£1 compared with the preceding session’s N1,839.13/£1, but lost 66 Kobo against the Euro to finish at N1,574.97/€1, in contrast to Wednesday’s N1,574.31/€1.
At the GTBank forex counter, the Naira depreciated against the US Dollar yesterday by N1 to close at N1,358/$1 versus the previous session’s N1,357/$1, while at the parallel market, it remained unchanged at N1,390/$1.
Daily FX update released by the Central Bank of Nigeria (CBN) showed that interbank turnover at the official window increased by 0.22 per cent to $371.788 million from $370.98 million, with the number of deals up to 134 from 100.
Transactions were consummated between N1,347 and N1,351.5000 during the trading session.
As for the cryptocurrency market, Bitcoin (BTC) topped $75,000 in the latest rally amid euphoria over a US Treasury liquidity signal from the buyback plan, rising by 8.8 per cent to $75,371.36.
The US Treasury Department has decided to at least double liquidity-support buyback operations for longer-dated nominal coupon securities. This applies in the 10- to 30-year segment.
Additional catalysts included the latest crypto proposal by the US Securities and Exchange Commission (SEC), while President Donald Trump, after meeting with prominent crypto executives, urged Congress to pass what he calls a fair version of the Clarity Act before year-end.
Further, Ripple (XRP) rose by 18.7 per cent to $1.30, Cardano (ADA) grew by 13.9 per cent to $0.2086, Dogecoin (DOGE) improved by 10.8 per cent to $0.0826, Solana (SOL) expanded by 6.5 per cent to $90.37, Binance Coin (BNB) soared by 6.3 per cent to $664.00, Ethereum (ETH) jumped by 5.2 per cent to $2,363.26, and TRON (TRX) climbed by 1.5 per cent to $0.3379, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.
By Dipo Olowookere
For the eighth straight session, the Nigerian Exchange (NGX) closed lower, losing 0.32 per cent at the close of business on Thursday as a result of continued sell-offs.
Yesterday, the financial and energy sectors came under selling pressure as investors’ appetite for domestic equities waned, with attention turning to the 2027 presidential campaigns, which kicked off on Wednesday.
The energy index shed 2.49 per cent, the insurance sector depreciated by 0.79 per cent, and the banking segment declined by 0.41 per cent. But the consumer goods space gained 0.10 per cent, while the industrial goods counter closed flat.
When the market closed for the day, the All-Share Index (ASI) contracted by 712.67 points to 240,037.80 points from 240,750.47 points, and the market capitalisation decreased by N439 billion to N154.978 trillion from N155.417 trillion.
International Energy Insurance slumped by 9.85 per cent to N4.30, Coronation Insurance dropped 9.84 per cent to trade at N2.20, Fortis Global slipped by 9.76 per cent to N1.85, AVA Capital crashed by 7.89 per cent to N7.00, and Zichis shrank by 7.36 per cent to N17.00.
On the other side, Haldane McCall rose by 9.38 per cent to N3.85, Trans-Nationwide Express jumped by 8.90 per cent to N3.06, McNichols appreciated by 8.33 per cent to N5.20, Cutix gained 2.56 per cent to close at N2.40, and Veritas Kapital expanded by 1.52 per cent to N1.34.
Business Post reports that Customs Street recorded 14 advancing stocks and 29 declining stocks, representing a negative market breadth index and weak investor sentiment.
A total of 2.9 billion shares worth N34.0 billion were transacted in 34,725 deals during the session versus the 1.2 billion shares valued at N37.8 billion traded in 34,546 deals at midweek. This showed that the trading value moderated by 10.05 per cent, while the trading volume and number of deals increased by 141.67 per cent and 0.59 per cent apiece.
Fortis Global Insurance was on top of the activity chart yesterday, with a turnover of 2.6 billion equities valued at N5.2 billion. Sterling Holdings exchanged 28.1 million shares worth N211.4 million, Trans-Nationwide Express transacted 21.7 million stocks for N66.2 million, UBA sold 17.9 million equities worth N803.7 million, and First Holdco traded 15.7 million shares valued at N2.0 billion.
