Oil Market Update: Despite the crude oil production cut agreement, Saudi continues to give competitors below the belt punches to gain market share…
According to tanker-tracking data compiled by Bloomberg, Saudi Arabia currently exports 9.3 million barrels of crude oil per day. Going forward, State-owned oil company – Saudi Aramco has pledged to increase output to 12.3 million barrels a day. Clearly, Saudi is bent on flooding the market with its oil before production cut deadline starts to count in May, and they are willing to sell it to Refiners on terms their competitors cannot match.
If they are bent on flooding the market, Refiners and Buyers can only take as much in the face of crippling demand. Guess what? Saudi is willing to give their oil out at the most ridiculous discounts, as high as $7.30. Again, a Refiner can only take as much as their liquidity can handle, Saudi isn’t going to be held back by I don’t have money, they are willing to offer their Buyers deferred payment options for as long as 90 days. This is a below the belt punch that oil-producing countries like Nigeria cannot handle.
In Nigeria, oil accounts for about 90% of FX earnings, as far as the dollar is concerned oil is everything to us. In the last 24 hours, the price of Nigeria’s Bonny light has dropped by over 12.8%, Imagine a scenario where we can’t afford to sell at ridiculously low prices and we cannot afford to offer discounts. What of deferred payments? The last time we checked, Nigeria needed credit.
If you followed our market report yesterday, on why the equities market is on a bullish run (kindly check your mail), and you add the updates above to it, you can guess what’s coming next.
Stock Market Update:
Your guess is as good as ours, Nigeria’s equity market is off to an early gain, currently up by 0.27%. We expect the activities of profit-takers to break the bullish run at some point, then stability will come in, but free fall may not be a possibility in the coming days.
FTSE (UK) – up by 0.26%, DAX (Germany) – up by 0.91%, CAC 40 (France) – up by 0.68% and Nikkei 25 (Japan) – down by 1.33%.
Click on the link https://bit.ly/2XrvIf9 to open a stockbroking/share purchase account and trade within 24 hours.
Money Market Update:
At the conclusion of T-Bills Primary Market Auction (“PMA”) yesterday, 15th April 2020, yields hit a new year low of 1.93%, 2.74% and 4.00% for 91-day, 182-day and 364-day tenors respectively.
Across tenors, the average return on T-bills is now 2.89%, if you take inflation into consideration, every kobo you invest in T-Bills will come back with a negative yield of -8.30%. That’s a No! No!. You need more than 1.93%, 2.74%, 4.00% or the average of 2.89% to grow your wealth, and we are willing to give more.
Our money market fund is still open and yield is currently over 11.5%, reach out to our team to grow your cash. We are digital, we are working from home, we are online and we are active. You can also do deposits with us at a starting rate of 10%.
See below for news headlines.
Headlines:
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CORONAVIRUS (COVID-19) HIGHLIGHTS
On the 15th of April 2020, 34 new confirmed cases of COVID-19 were recorded in Nigeria. Till date, 407 cases have been confirmed, 128 cases have been discharged and twelve deaths have been recorded in Nigeria. The 34 new cases are reported from five states- Lagos (18), Kano (12), Katsina (2), Niger (1), Delta (1). Read more
Oil firms’ N4.58tn loan repayment under threat – Investigation
The coronavirus-induced sharp fall in global oil prices poses a threat to the ability of oil and gas companies in the country to repay a total loan of N4.58tn, investigation has shown. The loans advanced to oil and gas companies by Nigerian banks rose to N4.58tn in the fourth quarter of 2019 from N4.55tn in Q3, according to the National Bureau of Statistics. Read more
FG pays N200bn to offset Gencos’ gas bill
The Federal Government has in the past two to three days paid over N200bn for power supply in Nigeria, the Group Managing Director, Nigerian National Petroleum Corporation, Mele Kyari, declared on Wednesday. Also, the Association of Nigerian Electricity Distributors, the umbrella body for Discos, has said the proposed two-month free electricity for customers announced by power distribution companies recently will cost a total of about N120bn. Read more
Oil edges higher after hitting 18-year lows but demand outlook weighs
Oil edged higher on Thursday following sharp losses in the previous session on hopes that a big build-up in U.S. inventories may mean producers have little option but to deepen output cuts as the coronavirus pandemic ravages demand. Brent crude LCOc1 was up 36 cents, or 1.3%, at $28.05 a barrel by 0502 GMT. U.S. West Texas Intermediate (WTI) was up 10 cents, or 0.5%, at $19.97. Read more
Stocks slide and dollar rally runs as economic realities bite
Asia’s stock markets retreated from their highest levels for a month and the dollar extended gains on Thursday as the damage the coronavirus has wrought on the world economy soured appetite for risk. Data showed U.S. retail sales fell the most on record last month and manufacturing output fell by the most in 74 years, raising fears of a deep recession. Another sky-high figure is expected when U.S. weekly jobless claims land later in the day. Read more
Latest on the spread of the coronavirus around the world
Reported cases of the coronavirus crossed 2.05 million globally and more than 136,600 people have died, according to a Reuters tally as of 0200 GMT on Thursday. Read more
Tesla shares jump on Goldman Sachs ‘buy’ rating
Tesla’s shares jumped more than 5 percent Wednesday morning before losing some ground in the afternoon, up 3.3 percent to $733.49, after analyst Mark Delaney gave the automaker’s stock a $864 price target, citing its head start on the competition in the EV market. Read more
Brent Oil Plunges as Saudis Offer Credit to Refiners, Deep Discounts to Asia
Ordinarily, Wednesday is EIA day and WTI should have tumbled on the latest huge build in U.S. crude stockpiles. But it was Brent that took the bigger hit as Saudi Arabia offered generous credit terms to refineries that bought its oil and deep discounts to its Asian customers. West Texas Intermediate, the New York-traded benchmark for U.S. crude, settled beneath the key $20-per-barrel support, closing down 24 cents, or 1.1%, at $19.87. Read more
Corporate Disclosures:
FCMB Group Plc – Notice of change of AGM Venue
In view of the Covid-19 pandemic and the federal government restriction on public gatherings, the 7th Annual General Meeting of FCMB Plc scheduled to hold at the shell Hall Muson Center, Onikan Lagos will now hold at the registered address of the company, First City Plaza, 44 Marina, Lagos. Read more
Wapic Insurance Plc – Notice of Board Meeting and Closed Period for Q1 2020 Accounts
Wapic Insurance wishes to inform the Nigerian Stock Exchange and the Investing Public that a meeting of the Board of Directors of Wapic Insurance Plc (“The Company”) has been scheduled to hold virtually on Monday, the 27th day of April, 2020 to amongst other things review the Company’s performance for the first quarter of the 2020 Financial Year as well as consider and approve the Q1, 2020 Unaudited Financial Statement of the Company. Read more
Sterling Bank Plc – Notice Annual General Meeting
NOTICE IS HEREBY GIVEN that the 58th Annual General Meeting of Sterling Bank Plc will be held at the MUSON Centre, Onikan, Lagos, on Wednesday, the 20th day of May, 2020 at 10.00 a.m to transact the following business read more
SFS Real Investment Trust – Unaudited FIRS Results for the Period ended 31 March 2020
See details here
SFS Real Estate Investment Trust – Key Performance Metrics for the Month Ended 31 March 2020
See details here