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Market Views

Bitcoin, Gold, leading Stocks tumble on strong U.S dollar

The U.S dollar index gained 0.6% on the day to settle at 90.77.

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Crypto, Investors flock to US dollar, Gold, Bitcoin, as Global Stocks record heavy sell-offs, Twitter Poll: Bitcoin price expected to reach $100,000 by 2021, cybercriminals, What it will take Bitcoin to hit $100,000?

The dollar was fired up at the last trading session of the week crushing its major currency rivals, Bitcoin, Gold, and leading global Stocks.

The U.S dollar retained its safe-haven status on the account of the U.S Dollar Index settled remarkably higher than a basket of six other global major currencies.

The U.S dollar index gained 0.6% on the day to settle at 90.77.

READ: U.S Central Bank leader says no rush into crypto dollar

What this means

Investors are piling to the U.S dollar after receiving worrying U.S economic data. Retail sales in the world’s largest economy were off 0.7% last month, the third straight drop.

  • Such upsides seen in the greenback’s value saw gold at the expense of a charging dollar whose strength astonished metal traders, saw gold futures losing as much as 1.16% to settle at 1,829.90/ounce
  • Also at press time the flagship crypto asset, Bitcoin traded at $35,756.99 with a daily trading volume of $70 Billion.
  • Bitcoin is down 7.38% for the day.

READ: Google, Facebook, Twitter stocks drop, investors ponder if big techs have become too powerful

Also, the world’s biggest stock market by market volume and liquidity suffered heavy losses, as data showed the Dow Jones Industrial Average plunged by 0.57% to settle at 30,814.26 index points, the S&P 500 lost about 0.72% to settle at 3,768.25 and the Nasdaq Composite fell by 0.87% to close at 12,998.50 index points.

The greenback was an outlier at the last trading session despite drops seen in U.S bond yields associated with the benchmark 10-year U.S. note, whose resurgence in the previous week had been the catalyst for the U.S dollar comeback.

READ: Gold on a grand slam win, gains $40 per ounce

What they are saying

Milan Cutkovic, Market Analyst at Axi, in an explanatory note to Nairametrics, spoke on fundamentals supporting the rebound of the U.S dollar;

  • “Many investors continue to stand on the side lines. President-elect Joe Biden unveiled his US$1.9 trillion stimulus plan. There were no major surprises, and a lot of it was already priced in.
  • “Investors are now focused on how quickly the Biden administration can implement their plans and support the ailing US economy. Although Biden will be inaugurated on Wednesday, the second impeachment of Donald Trump might overshadow the first few weeks of his term.
  • “Investors are also increasingly confronted with the reality that the pandemic is still far from being under control, despite the significant progress that was made in the past few months, and several COVID-19 vaccines already on the market.”

READ: Silver surpasses three-week high, joins Bullish momentum

Bottom line

Investors are increasingly confronted with the reality that the pandemic is still far from being under control, thereby flocking back to the safe-haven currency despite the significant progress that was made in the past few months, and several COVID-19 vaccines already on the market.

bitcoin train

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

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Market Views

Strong gains from WAPCO, Unity Bank limits Bears grip on Nigerian Stocks

Strong gains from WAPCO couldn’t stop Nigerian stocks from closing slightly red, as sell-offs intensified among medium capitalized stocks.

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Nigerian Breweries brings the Bears to party, Investors down N20.5 billion 

Nigerian stocks ended the last trading session on a near-stale mate. the All Share Index dropped by -0.08% to close at 39,331.61 index points as against the -0.40% plunge recorded on Thursday. Its Year-to-Date (YTD) returns currently stand at -2.33%.

  • However, the market trading turnover on Friday printed positive as volume ticked up by +19.18% as against the +101.84% uptick recorded yesterday.
    MANSARD, ZENITHBANK, and FBNH were the most active to boost market turnover.
  • The market breadth closed negative as MORISON led 20 Gainers as against 27 Losers topped by TRIPPLEG at the end of today’s session – an unimproved performance when compared with the previous outlook.

Top gainers

  1. MORISON up 10.00% to close at N0.66
  2. WAPCO up 9.90% to close at N22.2
  3. NEM up 9.88% to close at N1.89
  4. SKYAVN up 9.54% to close at N3.33
  5. UNITYBNK up 8.96% to close at N0.73

Top losers

  • TRIPPLEG down 10.00% to close at N0.72
  • TRANSEXPR down 10.00% to close at N0.81
  • UHOMREIT down 9.96% to close at N36.6
  • CUTIX down 9.95% to close at N1.81
  • SCOA down 9.90% to close at N2.64

Outlook

Nigerian Stocks ended the mid-week trading session on a slightly bearish note, amid soaring oil prices prevailing at the U.S trading session. At the time of writing this report, Brent crude was trading below $68.70/barrel.

  • That being said, strong gains from WAPCO couldn’t stop Nigerian stocks from closing slightly red, as sell-offs intensified among medium capitalized stocks.
  • Nairametrics envisages cautious buying, on the sentiments that recent price action shows further market correction as bargain hunters keep a tab on Nigerian macros.

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Market Views

Bears take Nigerian stocks hostage, investors lose N82.4 billion

Investor sentiment as measured by the market breadth closed negative with 12 advancers and 47 decliners.

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Bears

Nigeria’s all-share index fell further at the close of trading today, down by -0.40% to 39,364.67 points. Investors losses today stood at N82.35 billion.

  • Year-to-date return and market capitalization settled at -2.26% and N20.5 trillion, respectively.
  • Investor sentiment as measured by the market breadth closed negative with 12 advancers and 47 decliners.
  • Across coverage sectors, the performance was bearish. The NSE insurance, banking, consumer goods, and oil & gas sectors dipped 4.04%, 1.54%, 1.47%, 64 basis points, and 0.65%, respectively.
  • The flip side saw only the industrials improved marginally by 0.19%.

Top gainers

  1. UPL up 9.91% to close at N1.22
  2. MORISON up 9.09% to close at N0.6
  3. CAP up 5.26% to close at N20
  4. WAPCO up 3.59% to close at N20.2
  5. LIVESTOCK up 3.17% to close at N2.28

Top losers

  1. FIDSON down 10.00% to close at N4.41
  2. NNFM down 9.97% to close at N6.32
  3. ENAMELWA down 9.95% to close at N19.9
  4. NEM down 9.95% to close at N1.72
  5. NCR down 9.91% to close at N3.09

Outlook

Nigerian stocks ended the fourth trading session on a weaker note amid soaring oil prices prevailing at the U.S trading session.

  • Today’s bearish trading session was inclined by sell pressure on consumer ticker, DANGSUGAR which lost -6.25%. JBERGER, ARDOVA, and UBA also declined by -7.88%, 9.85%, and -3.64%, respectively.
  • Nairametrics expects intending buyers to seek the advice of certified stockbrokers.

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