Stocks gain N158bn in week ended June 10
Nigeria’s equities market increased by about N158billion or 0.55 percent in the trading week ended June 10, amid three days of positive closes as against two days of negatives.
The market’s year-to-date (YtD) return stood at 24.55percent, while the market has increased by 0.40 percent this month. The week’s positive close was driven by buy activities in favour of oil & gas; industrial stocks.
All NGX sectoral indices closed the week in red except NGX Oil & Gas index which went up by 0.68percent and NGX Industrial which advanced by 0.25percent.
The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation closed the review week at 53,201.38 points and N28.681trillion respectively as against 52,908.24 points and N28.523trillion recorded the preceding weekend.
Click to read more:Stocks gain N158bn in week ended June 10
US stocks crashes, following rising inflation rate
The much anticipated US inflation report came with its own demoralising impact, as a higher than expected May reading drove all three major US stock indexes lower at the close of trading on Friday.
As a result, the Dow Jones, S&P 500, and NASDAQ all ended Friday trading on-sell notes, falling 2.7 percent, 2.9 percent, and 3.5 percent, respectively.
Investors will be expecting the Federal Reserve Bank to hike rates following the May inflation report, which showed that inflation rose sharply from 8 percent to 8.6 percent.
According to tradingeconomics, the recession seems more likely following a record low of 50.2 from the Michigan consumer sentiment index. On a sector-to-sector basis, the banking and retail sectors led the losers’ chart, while the food & beverages ended below the flatline.
US May budget deficit smaller than expected
A report from the office of management and budget about the US government’s budget showed a falling spending situation as the deficit dropped by 50 percent, or $66 billion, for the month of May.
Accordingly, the budget deficit fell sharply to USD 66 billion in the month of May 2022, which represents a significant drop from $132 billion in May 2021.
The result also shows a $54 billion drop from what the market expected.
However, the treasury reported that a month-long extension of the deadline for individuals to file their income tax returns to mid-May resulted in a 16% drop in receipts to $389 billion.
According to Tradingeconomics, the US federal deficit was $426 billion, down 79 percent from $2,064 billion in the same period last year.
Kenya cancels Eurobond sale, blames surging yields
The Kenya government, which is taking a clue from other governments, has decided to cancel its planned sale of a 115 billion shilling (approximately $982 million) Eurobond.
The Uhuru Kenyatta-led government will instead borrow from commercial banks, citing the negative impact of the Russia-Ukraine war as the reason for the cancellation of the Eurobond.
According to Reuters, the government planned to issue a sovereign bond in January for the fiscal year 2021/22 (July-June) to help plug a 7.5 percent budget deficit.
Ukur Yatani, the country’s finance minister, had earlier yesterday told a section of the local press that the bond was no longer relevant as the interest rates serviceable had risen to 12 percent as a result of the war in Ukraine.
China Moly denies Congo administrator takes over its Tenke copper-cobalt mine
The Chinese company, China Molybdenum, has denied claims by the state mining company officials, Gecamines, that it has lost control of the Tenke Fungurume mining facility.
The Chinese company that controls the largest cobalt facility in the world denied reports that a temporary administrator for the site has been appointed.
According to Gecamines, the secretary-general who spoke with Reuters on Thursday said that a “court-appointed temporary administrator had officially taken charge amid a dispute between TFM shareholders.”
China Moly owns 80% of the copper and cobalt mine, with Gecamines owning the remaining 20%.
In February, fearing a collapse of the deal between both companies, a court appointed Sage Ngoie Mbayo as administrator for a period of six months until all issues pertaining to their working arrangement are sorted out.
In response, Vincent Zhou, spokesman for China Molybdenum, issued a statement denying any such development. He said in an email made available to Reuters, “There is no change in the management of TFM, and production and operations are running as usual.”
