ECONOMY AND CAPITAL MARKET NEWS
For Week Ended June 11, 2020
The Week in Summary
This week we introduce a section on POLITY, given the landmark political events that included the first Nigerian Democracy Day marked on June 12 – the day Moshood Abiola (although unannounced officially) was believed to have won a historic election in Nigeria. The oil markets may have started to slow down on the recent price momentum, as did the local and international capital markets. It’s not yet hurray after all.
CAPITAL MARKET
Investors Scramble for Third Sovereign Sukuk
The Debt Management Office (DMO) has announced the result of the third Sovereign Sukuk for which it offered N150 billion to investors. The Offer attracted a very high level of subscription from investors with total subscriptions of N669.124billion, representing a subscription level of 446{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f}. Source: DMO. Read More
Investors Gain N86.83bn WoW as NSEASI Inches Up by 0.67{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} to Close the Week Positive Equities market closed today on a negative note, as NSEASI depreciated by -0.13{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} to close at 25,182.67 points as against -0.47{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} depreciation recorded previously. Its Year-to-Date (YTD) returns currently stands at -6.18{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f}. Source Proshare Markets. Read More:
LCFE May List Dukia Gold
Barring unforeseen circumstances there are strong indications that a premier Gold company Dukia Gold and Precious Metals Refining Company may be listed on the Lagos Commodities and Futures Exchange (LCFE) as the first solid mineral company to be listed on any securities exchange in West Africa. Source: The Kernel. Read More:
Newrest ASL Nigeria Joins NASD Exchange After NSE Exit
The NASD Over-the-Counter (OTC) Securities Exchange has admitted the securities of Newrest ASL Nigeria Plc on its trading platform. NASD OTC Securities Exchange welcomed Newrest ASL Nigeria Plc to its trading platform as the 40th member to boost the unlisted securities’ market capitalisation and index. Newrest ASL was introduced to the exchange by APT Securities Limited on Thursday, June 11 2020 via security admission. It will operate under the symbol, SDNEWREST. Source: BusinessPost. Read More:
Unity Bank FY 2019 Results: The Highs and Lows of A Corporate Rebound
Unity Bank’s financial results for 2019 exceeded analysts’ expectations as the bank’s profit numbers turned around from a loss of N7.69bn in FYE 2018 to a profit of N3.38bn in FYE 2019 representing a +148.21 growth in the last financial year. Regardless of the bank’s strong profit before tax (PBT) growth between 2018 and 2019, a few areas of the bank’s operations create a looming shadow of what may appear to be a reversal of the bank’s fortunes. Source Proshare / The Analyst. Read More:
Stamp duty: NIPOST tackles FIRS, moves for Finance Act amendment
The Nigerian Postal Service has sent a request for an amendment to the Finance Act 2019 to the National Assembly as it seeks to be empowered to earn revenue from the collection of stamp duty. Source: Punch via Punuka Attorneys
Charles Fakrogha To Speak On Developments In The Nigerian Capital Market (Equities)
CHARLES FAKROGHA is the Chief Dealer for City Code Investments and Trust Limited and a seasoned Chartered stockbroker and Member, Nigerian Institute of Training and Development. Source: Proshare / WebTV. Read More:
THE NIGERIAN ECONOMY
Buhari Hails Osinbajo Led-Economic Sustainability Committee, Says Administration To Implement Recommendations
President Muhammadu Buhari has described the work of the Osinbajo led-Economic Sustainability Committee (ESC) as a “National Plan,” while stating that the administration is focused on implementing its recommendations, which includes massive Federal Government support for local production, manufacturing, significant support for the informal sector and MSMEs and the expansion of the Social Investment Programme to provide succour to more Nigerians. Source: Vanguard. Read more:
FSDH’S Macroeconomic Review 2020 Q2 and Outlook
The research team of FSDH Group has predicted that 2020 may end with inflation somewhere between 12.5{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} – 16{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} and GDP Growth between -0.4{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} – -5.9{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} (Best – to – Worst Case Scenarios). Read the robust report here:
Nigeria Witnessed 11 Quarters of Consecutive Economic Growth – Buhari
The President stated in his Democracy Day Broadcast: “We have witnessed eleven quarters of consecutive GDP growth since exiting recession. The GDP grew from 1.91{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} in 2018 to 2.27{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} in 2019 but declined to 1.87{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} in the first quarter of 2020 as a result of the decline in global economic activities due to the COVID-19 pandemic.” Source: Voice of Nigeria. Read More:
Nigeria exported N32 billion worth of electricity in 2019 — NERC
The Republics of Togo, Niger and Benin received a total invoice of N32.04 billion for the electricity supplied to them from Nigeria in 2019, data from the Nigerian Electricity Regulatory Commission have shown. Source: NERC via CardinalStone Research
FG Defaults In Pension Remittance For Six Years
The Pension Reform Act 2014 mandates all employers under the Contributory Pension Scheme to raise the contribution of their workers’ pensions from 15 per cent of total monthly emoluments to 18 per cent. The law was amended to address complaints of workers who were retiring but getting ridiculously low monthly stipends because of low balances in their Retirement Savings Accounts. Source Punch via Proshare
With Revised 2020 Budget Passed, What Next?
At Senate plenary, the revised 2020 budget figure for the fiscal year was jerked up by N301 billion to make it N10.810 trillion. The N301 billion added to the earlier proposal made by the executive came from increases in capital expenditure proposal, which was upped from N2.230 trillion to N2.488 trillion; recurrent expenditure rose from the earlier proposed N4.928 trillion to N4.942 trillion and statutory transfers increased from N398.505 billion to N428.033 billion. The upper legislative chamber also reviewed parameters assumptions of the revised proposals like $25 per barrel oil price benchmark increased to $28 per barrel; 1.9m barrel oil production per day target reduced to 1.8 million barrel per day while budget deficit rose from N2.28 trillion to N4.17 trillion. Source: ThisDay Live. Read More:
POLITY
National Broadcast By President Muhammadu Buhari On Democracy Day, June 12, 2020
Read President Mohammadu Buhari’s epoch making broadcast on the historic Democracy Day. Source: Voice of Nigeria. Read More:
Flashback: MKO Abiola’s Full Speech Which Led To His Arrest
Moshood Kashimawo Olawale Abiola, the adjudged winner of the June 12, 1993 presidential election in Nigeria, which was annulled, travelled out of the country to rally international support and reclaim his mandate. Upon his return, he declared himself as President. His declaration dubbed the ‘Epetedo Proclamation’ on June 11, 1994 led to his arrest, detention and eventual death. Sahara Reporters. Read More:
APC Disqualifies Gov. Obaseki
The All Progressive Congress, APC has disqualified Governor Godwin Obaseki from contesting for the primary elections under the party ahead of Edo 2020 governorship election. His disqualification was said to be due to discrepancies in his results. Source: Daily Trust. Read more:
GLOBAL REPORTS
COVID-19 to Plunge Global Economy into Worst Recession since World War II
The swift and massive shock of the coronavirus pandemic and shutdown measures to contain it have plunged the global economy into a severe contraction. According to World Bank forecasts, the global economy will shrink by 5.2{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f} this year.[1] That would represent the deepest recession since the Second World War, with the largest fraction of economies experiencing declines in per capita output since 1870, the World Bank says in its June 2020 Global Economic Prospects. Source: World Bank. Read More:
Global Stocks Plunge As Fears Of A Coronavirus Surge Grow In The US And China
Global stocks plunged Monday as the United States and China grapple with new coronavirus outbreaks, signaling that the pandemic isn’t done wreaking havoc on the global economy. Dow (INDU) futures plunged more than 800 points, or 3.2{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f}, extending losses ahead of the opening bell. S&P 500 (SPX) futures dropped 3{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f}, and Nasdaq (COMP) futures were down 2.3{f4997a821b7dae67819808a779ac92ab9dbc4adbd3c72d7a636eb4044a74aa5f}.
Markets across Asia also recorded steep declines after Beijing recorded a fresh cluster of the virus originating in the city’s largest wholesale food market. The Chinese capital has recorded 79 new cases since a locally transmitted infection was reported last Friday for the first time in nearly two months. Source: CNN Business. Read More:
The Oil Price Rally May Have Gone Too Far
Oil is set for the first weekly decline in over a month, dragged down by the broader selloff on Thursday. The jump in coronavirus cases in the U.S. sparked renewed concerns about the economic recovery. The Federal Reserve warned of long-term scars on the economy. At the same time, oil analysts have warned that the crude oil rally may have gone too far. Source Tom Kool of Oilprice.com via Proshare
DISCLAIMER
This compilation is for information purpose only. Investors are advised to always consult their Stockbrokers for reliable and specific investment guidance at every point in time. The names of certified individual Securities and Investment experts in Nigeria can be found on the website of the Chartered Institute of Stockbrokers, www.cisinigeria.org.
Reports compiled by CIS Research