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Union Bank Plc makes gainers’ list as NSE ends trading on a positive note

@nsenigeria ended Tuesday’s trading session in positive territory. The All Share Index closed at 28,144.87 basis points, down 1.21%. Year to date, the index is up 10.45%.

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All Share Index, Zenith, Fidelity, FBN leads actively traded stock on Wednesday

The Nigerian Stock Exchange (NSE) ended Tuesday’s trading session in positive territory. The All Share Index closed at 28,144.87 basis points, down 1.21%. Year to date, the index is up 10.45%.

Top Gainers and Losers: Neimeth International Pharmaceuticals Plc was the best performing stock on Tuesday. The stock gained 10% to close at N0.55. Lafarge Africa Plc gained 9.92% to close at N14.40. Nigerian Aviation Handling Company Plc gained 9.36% to close at N2.57. Union Bank of Nigeria Plc gained 6.20% to close at N6.85. Wapic Insurance Plc rounded off the top five gainers for the day. The stock gained 5.56% to close at N0.38.

On the flip side, Forte Oil Plc was the worst-performing stock, declining by 9.93% to close at N18.15. International Breweries Plc also fell by 9.80% to close at N13.80. Cornerstone Insurance Plc fell by 9.09% to close at N0.20. Linkage Assurance Plc fell by 8.62% to close at N0.53. Ikeja Hotel Plc rounded off the top five losers for the day. The stock shed 8.22% to close at N1.34.

[READ ALSO: Worry, as another Air Peace jet gets involved in an accident]

Top Trades by Volume: Guaranty Trust Bank Plc was the most actively traded stock on Tuesday. 15.6 million shares valued at N453 million were traded in 212 deals. Lafarge Africa Plc was next with 12.1 million shares valued at N218 million traded in 290 deals, followed by Sterling Bank Plc with 11.9 million shares valued at N26.9 million traded in 25 deals. United Bank of Africa Plc was next with 6.2 million shares valued at N35.5 million traded in 166 deals. United Capital Plc rounded off the top five most actively traded stocks with 6.1 million shares valued at N12.6 million traded in 77 deals.

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Corporate Actions

Conoil Plc announced its 49th Annual General Meeting which will be held at Meriden Ibom Hotel and Golf Resort, Uyo, Akwa-Ibom State on August 16, 2019 by 11.00am.

Lafarge Africa Plc notified the general public of the appointment of Mr. Marco Licata as a Non-Executive Director on the Board of Lafarge Africa Plc with took effect on July 21, 2019.

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Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

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Stock Market

Slack gains 22% on Salesforce buyout offer

Salesforce is reportedly interested in buying Slack, the popular workplace for many leading firms.

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Slack gains 22% on Salesforce buyout offer

Salesforce is reportedly interested in buying Slack. The popular workplace for many leading firms like Amazon has sent shares of the smaller firm up over 22% at the most recent trading session.

In a report credited to WSJ, the companies could reach a deal within days and possibly by the time Salesforce reports its third-quarter financial results, Tuesday.

READ: Jumia sees competition from startups in growing African e-commerce market

The anticipated deal has got global investors excited as Slack shares gained over 37%, according to data retrieved from Bloomberg. Slack is worth $40.70 per share as of the time of writing, valuing it at around $23.22 billion.

Salesforce the world’s biggest seller of customer relationship software is led by co-founder Marc Benioff, a pioneer in providing software via the cloud through a subscription.

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READ: DPR approves new Liquefied Petroleum Gas guidelines for investors, operators

What this means

Slack is popularly known among many firms for its user-friendly interface. It empowers global businesses to embed workflows. Stock experts anticipate such a deal would be beneficial to well in the Salesforce family of products, which spans marketing, sales, service, and more.

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READ: Microsoft Teams’ rival, Slack shares drop on withdrawal of full-year billings guidance

However, at the time of writing of Salesforce fell around 5% as some investors in the American-based SaaS pioneer were not so delighted about such synergy or perhaps worried about the price that would be required to bring such business to Salesforce fold.

READ: Ripple adds Bank of America to payment network

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Currencies

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.

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Naira depreciates as dollar sales top $100m a day at I&E window, Global Investment Trends Monitor, Foreign Direct Investment

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.

(READ MORE: Naira falls to weakest level in 6 weeks at black market despite CBN intervention)

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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.

(READ MORE: Naira stabilizes at black market as CBN continues its intervention in forex market)

NAFEX: The Naira depreciated against the dollar at the Investors and Exporters (I&E) window on Wednesday, closing at N393.25/$1.

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  • 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.

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Commodities

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.

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Five oil majors reduce value of their assets by $50 billion in Q2

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.

READ: FG says recent petrol price increase linked to Pfizer Covid-19 vaccine success

  • 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.

READ: NNPC, only Nigerian company to cut losses by N800 billion in one financial year – GMD

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.

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“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.

READ: Nigeria’s 5,000 BPD refinery will produce 271 million liters of petrol every year

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.”

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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.”

READ: How Cash flow, Liquidity, and Leverage impacts your financial plans

Bottom line

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.

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