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Markets

Gold spot prices plunge as U.S releases impressive economic data

Spot gold, which monitors real-time trades in bullion, plunged by 1.75%, to close at $1,684.21. 

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Gold, Gold prices tick up as President Trump decides on China today, Gold Prices Surges, Protests Erupts In America, Gold Down Over Increased Investor Confidence in Economic Recovery, Gold futures reach two months high over rising Covid-19 cases  

A shocking leap in America’s job numbers for last month pushed gold into a bearish mode, as it fell below the $1,700 mark. 

Spot gold, which monitors real-time trades in bullion, plunged by 1.75%, to close at $1,684.21. 

The May job report dumbfounded economists who had forecast a job loss of 8 million in May as the COVID-19 pandemic rattled parts of the U.S. economy negatively for a third straight month.

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“Gold traders rushed for the exits after they were stunned by the robust nonfarm payroll report,” said Ed Moya, analyst at New York’s OANDA told Reuters.  “It will be hard for the Fed to remain extremely accommodative if the world’s largest economy is already in recovery mode,” he added. 

Why invest in gold? Humans mainly use gold for making jewelry, physical coins, and recently, for industrial purposes such as in the production of electronics. However, it is rare enough that many people don’t have it, or have it in minute quantities. Humans are emotionally and physically drawn to gold. It provides a significant store of value. Investors buy gold to hedge against inflation.  

READ MORE: U.S dollar falls as investors panic over U.S-China relationship

In addition, America’s Federal Reserve, the Congress, and U.S. Treasury have collectively approved and disbursed trillions of dollars in outright aid to businesses, and grants and loans to individuals in recent weeks because of the COVID-19-triggered economic downturn. 

Sigma Pensions

 “I expect a return by next week to the basics of global economic recovery, before more headlines on Middle East worries, China-U.S. tariffs, debt and creeping — not negative interest rates — give gold a leg up,” said George Gero, managing director in charge of the precious metals portfolio at RBC Wealth Management in New York. 

Moya added that, “Gold might not get much more support from the Fed, but geopolitical risks, second wave concerns, and an eventually weaker U.S. dollar should keep the longer-term bullish outlook intact.” 

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Olumide Adesina is a France-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment trading. Message Olumide on Twitter @tokunboadesina. He is a Member of the Chartered Financial Analyst Society.

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Funds Management

Best Pension Funds in Nigeria for the month of March 2021

Nigerian Pension Fund administrators in the month of March 2021, recovered from the downturn recorded in February to post marginal growth.

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Pension plan participation among Nigerians increases

Nigerian pension funds asset recorded tepid growth in the month of March, recovering marginally from the negative growth recorded in the previous month, as 81.25% of the total funds recorded positive growth against 22% recorded in February.

This is according to data tracked by Nairalytics Research on the fund performances of Nigerian Pension Funds Administrators.

A cursory look at the data revealed that the RSA Fund IV on average performed the best in March, followed by RSA Fund III, while RSA Fund I remained flat in the review month.

Nairametrics considered the prices of the different RSA funds as of 28th February 2021 and compared them with the prices as of the last day of March (31st March 2021).

Below is a list of the best-performing funds in March


RSA Fund I

This fund has the highest allocation of risky or variable income instruments and participation is strictly upon a formal request from a contributor. The RSA Fund I is suitable for people who want to invest in high-risk instruments with higher rewards. Hence, contributors who are 50 years and above cannot apply to be moved into this fund.

According to available data 9 of the funds recorded positive growth in the month under review, as against 1 recorded in the previous month.

First position: Crusader Sterling Pensions Limited

  • March return: 0.68%

Second position: ARM Pension Managers Limited

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Sigma Pensions
  • March return: 0.52%

Third position: FCMB Pensions Limited

  • March return: 0.44%

Others on the list of gainers include; Premium Pension Limited, Trustfund Pensions Plc, Pensions Alliance Limited, Stanbic IBTC Pension Managers, NPF Pensions Limited, and Sigma Pensions Limited.

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It is noteworthy that Investment One Pension Managers and Veritas Glanvills Pensions were not included in the analysis, as their information could not be obtained, as at the time of writing this article. Considering the aggregate performance of the fund, it stood flat at 0%.


RSA Fund II

This fund is balanced and suitable for middle-aged contributors as well as those with a medium risk appetite. It is designed to be less risky with reduced allocation to variable income instruments compared to Fund I. The age requirement for participation is 49 years and below.

First position: Crusader Sterling Pensions Limited

Stanbic 728 x 90
  • March return: 0.65%

Second position: FCMB Pensions Limited

  • March return: 0.63%

Third position: ARM Pension Managers Limited

  • March return: 0.6%

Others on the list, which recorded positive growth in the month of March include; Leadway Pensure PFA, Nigerian University Pension Management, Trustfund Pensions, Pensions Alliance, Sigma Pensions Limited, Stanbic IBTC, and Radix Pension Fund Managers.

Of the 20 funds considered in the analysis, 16 recorded positive growth in value, representing 80% of the total. Meanwhile, it is noteworthy that as with the case in the RSA fund I category, Investment One Pension Managers and Veritas Glanvills Pensions, were not included.

The aggregate performance of the RSA Fund II, stood at 0.29% in March 2021.


RSA Fund III

This is a conservative fund that is designed for contributors close to retirement and contributors with a low-risk appetite. It is suited for contributors between the ages of 50 and 60 years. However, younger contributors may opt to participate in this fund category.

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First position: APT Pension Fund Managers Limited

  • March return: 1.17%

Second position: Crusader Sterling Pensions Limited

  • March return: 0.73%

Third position: Pensions Alliance Limited

  • March return: 0.66%

In this category of funds, all the pension funds posted positive growth in the month of March, with the exception of Investment One and Veritas Glanvills, which were not included in the analysis. The aggregate RSA Fund III, appreciated by 0.47% in March 2021.

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RSA Fund IV

The RSA Fund IV is exclusively for retirees. In the month of February, of all 22 Pension Fund Administrators, 10 of them recorded positive growth. However, they were all marginal growth of less than 1%.

First position: Pensions Alliance Limited

  • March return: 0.74%

Second position: First Guarantee Pension Limited

  • March return: 0.74%

Third position: Crusader Sterling pensions Limited

  • March return: 0.71%

Similarly, as witnessed in the RSA Fund III category all but AIICO Pension Managers recorded positive growth in March 2021, a recovery compared to the previous month. In terms of the aggregate performance, RSA Fund IV grew by 0.5% in the month under review.

According to the monthly report from the National Pension Commission, the total Pension Fund assets declined in the month of February 2021 from N12.3 trillion recorded as of 31st January 2021 to N12.25 trillion. This could be attributed to the bearish performance of the various funds in February 2021.

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Markets

Wall Street upsurges as unemployment and treasury yields fall

The S&P 500 increased by (+1.11%). The Dow also made a gain of (+0.90%).

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U.S Stocks set to surge higher, on hopes of a stimulus package deal, What Does The Circuit Breaker Tell Us

Stocks soared to new highs on Thursday, as investors awaited a far stronger-than-expected reading on consumer spending and a dramatic drop in the number of new jobless claims.

Retail revenues increased by 9.8%, with stimulus checks and lowered social distancing expectations contributing to the increase. Nasdaq surged (+1.31%) at the end of the trading session. The S&P 500 increased by (+1.11%). The Dow also made a gain of (+0.90%).

Treasury Yields fell. Retail sales increased to their highest level since May 2020, in March.

  • The yield on 10-year Treasuries was at 1.58%, after falling six base points.
  • The volume on U.S. exchanges was 9.3 billion shares, versus the 11.4 billion average for the last 20 trading days.
  • Unemployment claims fell to 576,000, the lowest level since the Covid-19 pandemic began, adding to the good economic news.

READ: Walls Street upsurges as unemployment declines

Top gainers  

  1. AMD up 5.68% to close at $83
  2. NVIDIA up 5.63% to close at $645.49
  3. Coty Inc up 5.55% to close at $9.13
  4. Xilinx Goldcorp up 5.25% to close at $130.10
  5. Newmont Goldcorp up 4.74% to close at $64.78

Top losers

  1. Trust Financial Corp -4.14% to close at $57.22
  2. MGM down -3.81% to close at $39.69
  3. Nordstom down -3.21% to close at $35.94
  4. Norwegian Cruise Line down -3.18% to close at $28.28
  5. Charles Schwab down -2.88% to close at $65.50

READ: Bitcoin ETF in North America has reached $1 billion in assets

Outlook

Sigma Pensions
  • Among the best ETFs, the Innovator IBD 50 ETF (FFTY) climbed 0.8%, while the Innovator IBD Breakout Opportunities ETF (BOUT) was up 0.7%. The iShares Expanded Tech-Software Sector ETF (IGV) gained 1.85%, with Microsoft and ADBE stock major components.
  • Nvidia (NVDA), Adobe (ADBE), and Facebook (FB) were among the first to make bullish movements around entry points. Apple (AAPL), Microsoft (MSFT), Amazon.com (AMZN), and Alphabet (GOOGL), the parent company of Google, have made significant gains.
  • Nairametrics, however, advises cautious buying in this era of growing uncertainties.

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