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Headlines & Insights: What to Expect in the Market this week…

| by Azeez Lawal | 0
Headlines & Insights: What to Expect in the Market this week…

Extension or Relaxation of the Lockdown

Following the joint recommendation of Governors’ Forum and Economic Sustainability Committee, we expect the FG to gradually ease lockdown considering the fact that the economy is currently choking. The possibilities of an increase in social unrest and criminal activities is also a concern.

 

However, relaxation of lockdown may not be a given considering the rate of increase in infections in the last five days and what has happened in the last four weeks since the lockdown commenced on 29th March 2020. We have seen a growth of over 45% from 873 on 22nd April to 1,273 as at 26th April 2020, and growth of over 1,000% since the original lockdown on 29th March 2020 when infections were just 111.


Welcome Back CBN

If the lockdown is relaxed in 24 hours, we expect CBN to lose its ‘hide-and-seek’ game with Foreign Portfolio Investors (FPIs) and finally show face in the office on 28th April 2020. The implication of that is more dollars to the I & E window.

More dollars will not necessarily guarantee the stability of naira but it’s an indication that FPIs may finally have the opportunity to exit the fixed income and equities market.

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Equities Market

Over a 13-day trading period, commencing 6th April 2020 the Market has gained over 9%, the last time that happened was in January 2020. The reason for this rare feat during ‘a pandemic’ is because foreign investors are currently trapped in the system with almost no option than to trade.

The return of the CBN with dollars may provide the exit they have been yearning for since March. Depending on how local investors can fill the space of FPIs, we may experience a free fall in ASI.

If your disposition towards risk is averse, if you are not a risk-taker, if you don’t like risk, now may be the time to watch the equities market closely or exit and head to the money market where you can enjoy some stability and capital preservation. If you are a risk seeker, taker or lover, you may want to continue your bargain hunts or exit now and come back in May.

Click on the link https://bit.ly/2XrvIf9 to open a stockbroking/share purchase account and trade within 24 hours.


Money Market Update:

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News Headlines:
Nigeria Records 91 New Cases Of COVID-19, Death Toll Rises To 40
Nigeria on Sunday recorded 91 new cases of the novel coronavirus, bringing the country’s total infections to 1,273, according to the Nigeria Centre for Disease Control (NCDC). According to the NCDC in a tweet via its official handle, 43 of the new infections were recorded in Lagos, 8 in Sokoto and 6 in Taraba. The country’s total deaths from the virus now stand at 40 while 239 have recovered. Read more
Latest on the spread of the coronavirus around the world
More than 2.97 million people have been reported to be infected by the novel coronavirus globally and 205,948 have died, according to a Reuters tally, as of 0200 GMT on Monday. Read more
COVID-19: Presidential committee proposes gradual easing of lockdown
The sub-committee of the Economic Sustainability Committee led by the Minister of Works and Housing, Babatunde Fashola has proposed the easing of the current COVID-19 lockdown in some states and the Federal Capital Territory, FCT, Abuja. Recall that President Muhammadu Buhari had during a nationwide broadcast on March 28, ordered a complete lockdown for 14 days in Lagos, Ogun, and the Federal Capital Territory, FCT, Abuja starting from March 29 as a measure to contain the spread of the dreaded COVID-19 pandemic in the country. Read more
UNCTAD seeks $3.4tn debt write-off for Nigeria, others
The United Nations Conference on Trade and Development is calling for urgent measures to address the debt burden estimated at $3.4tn in Nigeria and other developing countries facing economic disaster as a result of the coronavirus pandemic. UNCTAD in a report released on Thursday said developing countries were facing a looming debt disaster as most of the revenue of these countries had shrunk. Read more
Probe N5.4bn NDDC PPE contract, group tells EFCC
A group, the Niger Delta Rights Advocate, has called on the Economic and Financial Crimes Commission to investigate over N5.4bn personal protection equipment and COVID-19 sensitisation contract awarded to a firm, Signora Concept Services Limited, by the Niger Delta Development Commission. The group also sought for the probe of the circumstances leading to the award of the contract by the Interim Management of the Committee of the NDDC. Read more
What N1.4trn CRR deduction by CBN means for banks
The Central Bank of Nigeria (CBN) has deducted a whopping N1.4 trillion from the banking sector’s Cash Reserve Requirement (CRR) as all Nigerian Deposit Money Banks (DMBs) and merchant banks failed to meet the 65 percent Loan-to-Deposit Ratio (LDR) at the end of March 2020. This is coming at a time when the COVID-19 pandemic has hit hard on the economy and financial sector. CRR is the amount in percentage of total deposits that the banks must keep with the CBN. Read more
Develop post-COVID-19 mining strategy, says agency chair
THE Chairman of the Solid Minerals Development Fund, Mallam Saidu Malami, has urged the National Economic Council to develop a post-COVID-19 economic strategy for the mining sector. He said that the solid mineral sector had become more critical for national development due to the fall in the price of crude oil. Read more
NNPC, partners to build medical facilities in states
The Nigerian National Petroleum Corporation on Sunday announced plans of delivering medical infrastructure in all states across the country. NNPC’s Group Managing Director, Mallam Mele Kyari, disclosed this when the corporation and its partners handed over an ambulance and medical supplies to Kano State. Read more
COVID-19: Unilever donates N200m products
Unilever Nigeria has donated its food and hygiene portfolio brands across the country to complement the government’s efforts in helping citizens to stay well and maintain hygiene necessary to fight the coronavirus in this period and beyond. Among the products donated are – Lipton, Knorr, Royco, Glen Tea, Lifebuoy, OMO, Sunlight soaps, Pears, Vaseline, Closeup, and Pepsodent. Speaking on this initiative, the Director, Corporate Affairs and Sustainable Business, Ghana and Nigeria, Mrs. Soromidayo George, commended the states and federal governments for leading effectively in the COVID-19 crisis. Read more
India’s refiner shuns Nigeria’s crude oil in Q1
India’s Reliance Industries, owner of the world’s biggest refining complex, saw its imports of Nigerian crude oil slump to zero in the first quarter of the year, compared to 9,800 barrels per day in Q1 2019. India has remained the single largest buyer of Nigerian crude oil in the past few years after the United States slashed its imports from the country on the back of its shale oil production boom. Read more
Asia shares rally as BOJ buys more bonds, U.S. crude skids

Asian shares bounced on Monday as the Bank of Japan (BOJ) announced more stimulus steps to help cushion the economic impact of the coronavirus, but the recent weak run in the global oil price showed no signs of ending. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.8%, taking back a chunk of last week’s 2.6% decline. Japan’s Nikkei gained 2.6%, and Chinese blue chips 1%. After a soft start, E-Mini futures for the S&P 500 climbed 0.85%, while EUROSTOXX 50 futures added 2.6% and FTSE futures 1.35% Read more.

U.S. economy faces historic shock, with 16% joblessness possible, Trump adviser says
The shuttering of the U.S. economy due to the coronavirus pandemic is a shock of historic proportions that will likely push the national unemployment rate to 16% or higher this month and require more stimulus to ensure a strong rebound, a White House economic adviser said on Sunday. “It’s a really grave situation,” President Donald Trump’s adviser, Kevin Hassett, told the ABC program “This Week.” “This is the biggest negative shock that our economy, I think, has ever seen. We’re going to be looking at an unemployment rate that approaches rates that we saw during the Great Depression” of the 1930s, Hassett added. Read more
SEPLAT Petroleum Development Company Plc 2019 Annual Report and Notice of AGM
Lagos and London – 27 April 2020: SEPLAT Petroleum Development Company Plc (“SEPLAT” or the “Company”) confirms it has today published its Annual Report and Accounts for the year ended 31 December 2019 together with the notice of the Company’s seventh Annual General Meeting (“AGM”) and forms of proxy. The Company will hold its AGM at 11:00am (local time) on Thursday 28 May 2020 at 16a Temple Road (Olu Holloway), Ikoyi, Lagos, Nigeria. Read more
Oklahoma asks Trump to declare coronavirus an ‘act of God’ to help oil producers
Oklahoma’s governor has called on U.S. President Donald Trump to declare the coronavirus pandemic an “act of God,” a step to help oil-producing states contend with a crude glut that caused futures prices to close below $0 last week for the first time. “Over-production of oil continues to threaten the economy,” Governor J. Kevin Stitt said in a letter to Trump that Stitt posted on Twitter late on Saturday. Read more

 

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