This week, the Nigerian Stock Exchange All Share Index closed in positive territory. The NSE All Share Index opened the week at 30,881.29 and closed at 31,069.37 basis points, up 0.61%.
The market opened for four trading days this week as the federal government declared Wednesday, 29th May, 2019 a public holiday to mark the Inauguration Day celebrations 2019.
35 equities appreciated in price during the week, higher than 30 in the previous week. 24 equities depreciated in price, lower than 40 equities of the previous week, while 109 equities remained unchanged, higher than 98 equities recorded in the preceding week.
Sterling Bank Plc
Sterling Bank Plc appreciated by 11.11% this week. The stock opened at N2.07 and closed at N2.30, up N0.27. Year to date, the stock is up 21.05%.
Ecobank Transnational Incorporated
ETI opened the week at N10.05 and closed at N11.15, up N1.10 or 10.95%. Year to date, the stock is down 20.36%.
AXA Mansard Insurance Plc
AXA appreciated by 10% this week. The stock opened at N1.80 and closed at N1.98, up N0.18. Year to date, the stock is up 8.20%.
Learn Africa Plc
Learn Africa Plc gained 9.84% this week. The stock opened at N1.22 and closed at N1.34, up N0.12. Year to date, the stock is down 1.47%.
Neimeth International Pharmaceuticals
Neimeth International Pharmaceuticals Plc opened the week at N0.51 and closed at N0.56, up N0.05 or 9.80%. Year to date, the stock is down 28.21%.
Livestock Feeds Plc
Livestock Feeds Plc opened the week at N0.54 and closed the week at N0.59, up N0.05 or 9.26%. Year to date, the stock is up 20.41%.
Unity Bank Plc
Unity Bank Plc gained 9.23% this week. The stock opened the week at N0.65 and closed at N0.71, up N0.06. Year to date, the stock is down 33.64%.
Law Union and Rock Insurance Plc
Law Union and Rock Insurance Plc opened the week at N0.44 and closed at N0.48, up N0.04 or 9.09%. Year to date, the stock is down 20%.
Courteville Business Solutions Plc
Courteville Business Solutions Plc rounds up the top 10 gainers for the week. The stock opened at N0.22 and closed at N0.24, up N0.02. Year to date, the stock is up 20%.
Berger Paints Plc
Berger Paints Plc was the worst performing stock this week. The stock declined by 9.52%, opening at N7.35 and closing at N6.65, down N0.70.
Year to date, the stock is down 22.67% and trading at its lowest point this year.
RT Briscoe Plc
RT Briscoe Plc opened the week at N0.32 and closed at N0.29, down N0.03 or 9.38%. Year to date, the stock is down 23.68%.
Eterna Plc shed 8.75% this week. The stock opened at N4 and closed at N3.65, down N0.35. Year to date, the stock is down 22.34%.
Chemical and Allied Products (CAP) Plc declined by 8.53% this week. The stock opened at N34 and closed at N31.10, down N2.90. Year to date, the stock is down 10.76%, and is trading at its lowest point this year.
The stock was marked by down by N2.90, this week and ex dividend price was N31.10.
Champion Breweries Plc
Champion Breweries opened the week at N1.10 and closed at N1.01, down N0.09 or 8.18%. Year to date, the stock is down 49.25% and is trading at a year low.
Fidelity Bank Plc
Fidelity Bank Plc opened the week at N1.81 and closed at N1.68, down N0.13 or 7.18%. Year to date, the stock is down 17.24%.
Jaiz Bank Plc
Jaiz Bank Plc shed 6.12% this week. The stock opened at N0.49 and closed at N0.46, down N0.03 or 6.12%. Year to date, the stock is down 8%.
Veritas Kapital Assurance Plc
Veritas Kapital Assurance opened the week at N0.21 and closed at N0.20, down N0.01 or 4.76%. Year to date, the stock is down 13.04%.
PZ Cussons Nigeria Plc
PZ Cussons Nigeria Plc declined by 4.71% this week. The stock opened at N8.50 and closed at N8.10, down N0.40.
Year to date, the stock is down 33.06% and trading at its lowest price point.
Oando Plc rounds up the top 10 losers for the week. The stock shed 4.20% this week, opening at N4.40 and closing at N4.20, down N0.20.
Year to date, the stock is down 5.38%.
The Securities and Exchange Commission (SEC), yesterday ordered Oando Plc‘s Group Chief Executive Officer (CEO), Wale Tinubu to resign from his position over serious infractions including false disclosures, market abuses, amongst others.
The regulator disclosed that it has also barred Tinubu alongside his deputy, Omamofe Boyo from being directors of any quoted company for the next five years.
The company has however called the allegations unsubstantiated, and as such, the recommendations/penalties are pointless. Oando has however vowed to challenge the recommendations.
Naira crashes across forex markets as CBN Governor hits at black market
At the black market, the Naira depreciated against the dollar to close at N487/$1 on Wednesday.
Forex turnover dropped by 68.2%, as Nigeria’s exchange rate at the NAFEX window depreciated significantly against the dollar to close at N393.25/$1 during intra-day trading on Wednesday, November 25.
Also, the naira crashed further against the dollar, closing at N487/$1 at the parallel market on Wednesday, November 25, 2020, as the CBN Governor who alleged that the black market is a tainted market used for bribe and corruption, said the Nigerian official exchange rate should not be determined by the rate at the parallel market.
The CBN, a few days ago relaxed its earlier policy on banning third parties from having access to foreign exchange routed through Form M.
Parallel market: According to information from Abokifx – a prominent FX tracking website, at the black market where forex is traded unofficially, the Naira depreciated against the dollar to close at N487/$1 on Wednesday.
This represents an N4 drop when compared to the N483/$1 that it exchanged for on Tuesday, November 24.
- The local currency had strengthened by about 7.8% within one week in September at the black market, as the CBN introduced some measures targeted at exporters and importers.
- This is to boost the supply of dollars in the foreign exchange market and reduce the high demand for forex by traders.
- The CBN has sold about $1 billion to BDCs since they resumed forex sales on Monday, September 7, 2020.
- This was expected to inject more liquidity into the retail end of the foreign exchange market and discourage hoarding and speculation.
- However, the exchange rate against the dollar has remained volatile after the initial gains made, following the CBN’s resumption of sales of dollars to the BDCs.
- The President of the Association of Bureau De Change Operators, Aminu Gwadebe, said he expects the impact of the extra liquidity in the market to be gradual.
- Despite the drop in speculative buying of foreign exchange, the huge demand backlog by manufacturers and foreign investors still puts pressure and creates a volatile situation in the foreign exchange market.
NAFEX: The Naira depreciated against the dollar at the Investors and Exporters (I&E) window on Wednesday, closing at N393.25/$1.
- This represents an N7.75 gain when compared to the N385.50/$1 that it exchanged for on Tuesday, November 24.
- The opening indicative rate was N386.29 to a dollar on Wednesday. This represents a 33 kobo drop when compared to the N385.96 that was recorded on Tuesday.
- The N395 to a dollar was the highest rate during intra-day trading before, it still closed at N393.25 to a dollar. It also sold for as low as N383/$1 during intra-day trading.
- Forex turnover: Forex turnover at the Investor and Exporters (I&E) window declined by 68.2% on Thursday, November 19, 2020.
- According to the data tracked by Nairametrics from FMDQ, forex turnover dropped from $163.87 million on Tuesday, November 24, 2020, to $52.09 million on Wednesday, November 25, 2020.
- The CBN is still struggling to clear the backlog of foreign exchange demand, especially by foreign investors wishing to repatriate their funds.
- The drop in dollar supply after some trading days of improvement reinforces the volatility of the foreign exchange market. The supply of dollars has been on a decline for months due to low oil prices and the absence of foreign capital inflow into the country.
- The average daily forex sale for last week was about $169.93 million, which represents a huge increase from the $34.5 million that was recorded the previous week.
- Total forex trading at the NAFEX window in the month of September was about $1.98 billion, compared to $843.97 million in August.
- The exchange rate is still being affected by low oil prices, dollar scarcity, a backlog of forex demand, and a shaky economy that has been hit by the coronavirus pandemic.
- A financial expert and Managing Director of Financial Derivatives had stated that he expects the exchange rate at the parallel market to likely depreciate to N470-N475/$1 in November and December due to low oil prices that will further limit foreign exchange supply.
- Some members of MPC of the CBN have expressed serious concerns over the increasing demand pressure in the country’s foreign exchange market. This is an obligation of manufacturers to their foreign suppliers that continues to increase in the face of dollar shortages.
Oil prices up, energy demand up
Brent oil futures gained 0.51% to trade at $48.86/barrel and the West Texas Intermediate futures ticked up by 0.46% to trade at $45.92/barrel.
Crude oil prices continued their bullish trend at London’s trading session on Thursday morning. Oil traders are going long, as recent data from the world’s largest economy reveals a surprise draw in U.S. crude oil stockpiles, coupled with high buying interest from Asia, strengthened the resolve of oil traders to go long.
- At about 6.15 GMT, Brent oil futures gained 0.51% to $48.86/barrel.
- West Texas Intermediate futures ticked up by 0.46% to trade at $45.92/barrel.
- Data from the EIA revealed a plunge of 754,000 barrels for the week to November 20.
- However, Gasoline stocks gained 2.2 million barrels in the week to 230.2 million barrels, the Energy Information Administration said.
What they are saying
In an explanatory note to Nairametrics, Stephen Innes, Chief Global Market Strategist at Axi, gave deep insights on key fundamentals pushing oil prices up amid a COVID-19 era.
“Oil traded higher on Wednesday in a very tight range until the rally midday in New York. WTI attempted a clean push through $46, and Brent printed through $49 before retracing some.
The inventory numbers released earlier in the NY session helped push the market higher, with the EIA figures more bullish than the previous days’ API estimates and bullish to consensus.”
He also elaborated on the buying interest seen lately from the Asian economic juggernauts, China and India, which is giving oil bulls enough gas in roaring hard, “Asia’s unquenching demand remains for all to see. Chinese and Indian buying interest continues with tenders issued for both spot and term cargoes, directly responsible for increased demand and reflected in the Brent curve, which has moved to a mild backwardation this week.”
The colossal moves prevailing in the crude oil market over the past two days echo optimism amid positive vaccine development. The flattening of the curve suggests that a positive surprise on current demand is also being reflected.
Pigs on a rampage, Bitcoin drops $2,000
Bitcoin prices plunged by more than 15%, approaching the $17,000 level.
It appears that the bulls driving Bitcoin upward lately have momentarily gone out of steam. Bitcoin prices plunged by more than 15%, approaching the $17,000 level, after reaching as high as $19,580, owing to heavy losses as large investors cash in on some of their Bitcoin holdings.
- The crypto lost $2,000 in a matter of few hours, falling around $17,000 before it sprang up back to the $17,900 price level.
- Taking into consideration that most bitcoin wallets are in profit, unsurprisingly, some investors are already cashing out some of their gains amid the end of a turbulent 2020.
- That said, its recent price action shows its tilting towards an overbought position.
At the time of writing, Bitcoin price was $17,890.84 with a 24-hour trading volume of $33,259,413,581.
The Head of the blockchain intelligence platform further anticipated the likelihood for Bitcoin to go through a period of correction, as more investors deposit their BTC on Coinbase.
“Too many BTC whales on Coinbase. I’m still long-term bullish, but we might face some corrections or sideways until whales become inactive on spot exchanges.”
Should you buy it?
Although it’s more likely that some Bitcoin whales increase their purchases when prices drop to these levels, Nairametrics, envisages cautious buying, as the volatility in this fast-changing market, could lead to a significant loss of capital.
However, if things get really terrible, Nairametrics believes this could be another chance to buy bitcoin below $15,000.
What you should know
Recall Nairametrics exclusively broke the news on how a crypto strategist, Ki-Young Ju, recently warned on the high influx of big-time Bitcoin holders moving a significant portion of their BTC holdings to a well-known crypto exchange, Coinbase, obviously to cash out, amid the bullish trend currently in play.