Five things to know to start your Wednesday

Stocks lose over N500bn as CBN hikes benchmark interest rate

Nigeria’s equities market decreased further on Tuesday as the nation’s apex banker – CBN -after a long while increased its benchmark interest rate to 13percent from 11.5percent, in move to check accelerating inflation.
The nation’s stock market lost N519billion or 1.82percent decline, recording its largest daily dip since this month. No thanks to Guinness Nigeria Plc which recorded the highest decline, from day-open high of N98 to N88.20, losing N9.80 or 10percent.

The 285th Monetary Policy Committee (MPC) meeting was concluded on Tuesday and the CBN Governor Godwin Emefiele announced the committee’s decision.

Ahead of the announcement, analysts at Lagos-based United Capital had noted their belief that the appropriate policy decision will be to raise the Monetary Policy Rate (MPR). “First, aggregate price level is spiralling out of control, following the 90basis points surge in April 2022 while inflation is expected to sit pretty outside the CBN’s comfort zone,” the analysts said.

The Nigerian Exchange Limited (NGX) All-Share Index (ASI) and Market Capitalisation decreased to 51,949.64 points and N28.006trillion respectively, from the preceding day’s highs of 52,911.51 points and N28.525trillion. Also, the market’s positive return year-to-date (YtD) decreased to 21.6 percent.

ETI, Jaiz Bank, Access Holdings, UACN and Transcorp were the most traded counters on the local Bourse. In 6,096 deals, investors exchanged 720,192,027 units valued at N8.867billion.

Lagos-based Meristem analysts had on Monday ahead of the Treasury Bills auction during the week, expected further profit-taking on stocks that have recorded decent price appreciation in recent weeks, adding that as profit-taking activities dictate the market direction, they expect the market to close in the negative region this week.

Early this week, the National Bureau of Statistics (NBS) first-quarter (Q1) 2022 GDP report shows that the Nigerian economy expanded by 3.1percent in real terms despite concerns that the growth eludes businesses and households.

“While we expect base effects to fade substantially in second-quarter (Q2) 2022, we see upsides from the full reopening of the land borders, lifting of restrictions on SIM registrations, and pre-election spending. With crude theft being the driver of pipeline shutdowns and reduced oil production, we remain downbeat on the oil sector,” said Ibukun Omoyeni and Angela Onotu, both analysts at Vetiva Capital Management in their recent note on Nigeria’s GDP.

US futures rise after tech stock selloff

An early warning sign from some social media giants like Snap that they will miss their second-quarter earnings and revenue targets pushed stock futures higher this morning after technology shares responded with a massive selloff last night.

As of yesterday evening, all futures contracts tied to the three major indexes (S&P 500, the Nasdaq, and the Dow Jones Average) were all trading in positive territory.

Nordstrom, which is an American luxury department store chain founded in 1901 by Swedish immigrants, John W. Nordstrom and Carl F. Wallin and with its headquarters in Seattle, Washington, saw its shares gain nearly 10 percent in “extended trading after the retailer surpassed sales expectations and raised its full-year outlook.”

According to information gathered, at the close of regular trading on Tuesday, the Nasdaq lost 2.35 percent of its market value owing to losses accrued by digital advertising firms like Snap, which lost-43 percent, Meta Platforms, which lost-7.6 percent, and Google’s Alphabet, which lost-5 percent.

The S&P 500, on the other hand, lost 0.81 percent of its market cap, while the Dow gained 0.15 percent at the close, closing at 31,928.62 basis points.

Meanwhile, tradingeconomics analysts predict that traders will continue to closely monitor equity markets to see how companies deal with rising material costs to ensure production. With reports from Nvidia and Snowflake expected this week, we expect more changes in events in favour of or against the market.

Investors are also keeping an eye on the FED monetary policy meeting as we await minutes from the Jerome Powell-led MPC board.

ExxonMobil asset sale setback mirrors Chevron’s in 2017

Gunman kills 18 children, 3 adults killed in Texas deadliest school shooting

An 18-year old gunman known as Salvador Ramos killed more than 18 children and 3 adults on Tuesday at a Texas elementary school. The killing, the latest in a string of killings in the country, serves as a stark reminder of how flawed the country’s gun laws are.

The young man, who just turned 18, went from classroom to classroom killing children, an official who spoke to the press said. The assailant was eventually killed by a law enforcement officer.

According to the Associated Press (AP), Senator Roland Gutierrez, who was briefed by the state police, said that the death toll was not only limited to the 18 children but also included three adults.

This massacre at Robb Elementary School in the heavily populated Latino town of Uvalde was the deadliest shooting at a U.S. grade school since a gunman killed 20 children and six adults at Sandy Hook Elementary in Newtown, Connecticut, almost a decade ago.

The attack not only represents the second mass shooting attack since 2018 when 10 people were killed at Santa Fe High School in Texas, but comes just 10 days after a deadly attack that took place in Buffalo, New York City.

Many humanists and activists have been calling for a massive reform in the US gun regulations. They believe a total change in the gun laws will make America safer.

“My heart is broken today,” said Hal Harrell, the school district superintendent, announcing that all school activities were cancelled until further notice. “We’re a small community and we’re going to need your prayers to get through this.”

According to the AP, which picked up the report from CNN, said that Sgt. Erick Estrade of the Texas Department of Public Safety was informed that the gunman, who was wearing body armour and had hinted on social media of an upcoming attack, crashed his car outside the school before going for the onslaught at the school.

Senator Gutierrez said that the 18-year old gunman had killed his grandmother before heading to the school with two military-style rifles he had purchased on his birthday.

“That was the first thing he did on his 18th birthday,” he said.

Up to now, officials have not been able to identify a motive for his attack. There was no indication on social media as to why he would want to carry out a murderous attack.

“A Border Patrol agent who was working nearby when the shooting began rushed into the school without waiting for backup and shot and killed the gunman, who was behind a barricade,”

“The agent was wounded but able to walk out of the school,” a law enforcement agent who pleaded anonymity told the AP.

The school district’s police chief, Pete Arredondo, said that the attacker acted alone.

Reports from the district police chief showed that, among the dead, 13 children were taken to Uvalde Memorial Hospital with different degrees of injuries, while a 66-year-old woman who was in critical condition was taken to another hospital for immediate medical attention.

The massacre in Uvalde, represents the deadliest school shooting in Texas history and is a painful reminder of the long list of school shootings in the US over the past 10 years.

Turkey to meet with Sweden, Finland Wednesday to discuss NATO

There seems to be light at the end of the tunnel for Sweden and Finland as both countries send a high-powered diplomatic delegation to discuss an end to Turkey’s objection to both countries’ bid to join NATO.

Officials from the Baltic countries are to travel on Wednesday to try and overcome this “Turkey hurdle” in their bid to protect themselves through the western alliance (NATO) against Russian aggression.

The diplomatic team will be led by the state secretary of Sweden, Oscar Stenstrom, and his Finnish counterpart, Jukka Salovaara. They are to meet with Turkey’s chief presidential aide, Ibrahim Kalin, to discuss in broad terms the country’s objection to them joining NATO and how to resolve the current impasse between them. This is according to a statement from the Turkish foreign ministry.

Earlier last month, Turkey accused both Baltic nations of supporting Kurdish militants—the PKK—a reason it found strong to withhold its support and endorse their application to join the North Atlantic Treaty Organization (NATO). Bloomberg also reported that Recep Tayyip Erdogan of Turkey is also not pleased with the way NATO member countries have handled the Kurdish militant groups threatening the unity of the country.

Ahead of the all-important meeting, concerns about lifting the arms embargo on Turkey by both countries on the grounds of the Kurdish militia group took centre stage in talks. The foreign minister of Turkey, Mevlut Cavusoglu, said in a private broadcast on NTV, a TV station in Turkey.

“We want absolute guarantees,” Cavusoglu said.

ExxonMobil to sell its first LNG product from Mozambique later this year

ExxonMobil Corp has said that it is looking forward to its first liquefied natural gas (LNG) export from Mozambique later this year. While speaking at the ongoing World Gas Conference, which is taking place in Daegu, South Korea, its head of global LNG, Peter Clarke, informed the audience that the company expects to start exporting liquefied natural gas from its Rovuma Gas project sometime this year.

According to nsenergybusiness.com, the Rovuma Project is a 15.2 million tonne per annum (Mtpa) LNG export facility planned to be developed to liquefy and market gas resources from three reservoirs in the Area 4 block of the Rovuma Basin, offshore Mozambique.