• Thursday, March 28, 2024
businessday logo

BusinessDay

The Week Ahead

The Week Ahead

Petroleum tanker drivers suspend tomorrow’s strike in the week ahead

The National Union of Petroleum and Gas Workers (NUPENG) on Sunday said that the planned strike by its affiliate members, Petroleum Tanker Drivers (PTD), has been suspended.

Tayo Aboyeji, the South-West Zonal chairman of NUPENG, disclosed this in an interview with the News Agency of Nigeria (NAN) in Lagos.

According to Aboyeji, the suspension is to allow the union’s representatives and that of the government to address the knotty issues at stake.

“The leadership of the union after a brief meeting with representatives of government decided to suspend the strike in the interest of the nation.”

Ikeja Electric customers to experience outages in the week ahead

Ikeja Electric Plc has announced that some areas under its operational network will experience outages for a period of eight weeks to enable the Transmission Company of Nigeria (TCN) to re-conduct its 132KV lines.

Olajide Kumapayi, chief technical officer, Ikeja Electric, made the announcement at a news briefing on Monday in Ikeja, according to the News Agency of Nigeria.

Kumapayi said the project which would begin on Oct. 11 was aimed at increasing the capacity of the transmission lines to wheel more power from the generation companies.

He noted that some of the 132K lines installed over 50 years ago had become obsolete and degraded due to time and usage.

According to him, areas that will be affected by this stage of the project include Oregun, Police Training College, Oba Akran, Oke Ira, Ogba, Magodo, Anifowoshe, and Omole Phase One.

“This will affect all categories of customers within the area especially our Maximum Demand (MD) customers such as Ikeja City Mall, Police College, Lagos State University Teaching Hospital and the Ikeja High Court,” Kumpayi said.

“The implication of this is that from 8 a.m. to 6 p.m. every day, the substations controlling these areas will be switched off which will affect the feeders connected to them,” he added.

Fully vaccinated Nigerians can travel to the UK without pre-departure tests in the week ahead

The UK government announced that fully vaccinated travellers from Nigeria can travel to England without needing a pre-departure covid test from the 11th of October.

This was disclosed in a statement by the British High Commission, in Abuja on Thursday.

They also revealed that the policy includes Nigerians vaccinated with the AstraZeneca, Pfizer, Modern and Johnson & Johnson vaccine.

“Fully vaccinated means that you have had a complete course of an approved vaccine at least 14 days before you arrive in England.”

“The day you had your final dose does not count as one of the 14 days. You must be able to prove that you have been fully vaccinated under a vaccination programme and have valid proof of vaccination recognised by the British Government (for Nigeria, the certificates with valid QR codes as issued by Nigeria’s Primary Healthcare Development Agency are recognised),” he said.

Read also: The Week Ahead

Ben Llewellyn-Jones, Acting High Commissioner to Nigeria said, “The exemption of fully vaccinated Nigerians travelling to the Uk from providing a pre-departure test and self-isolating for 10 days, is a very welcome development.”

“To make this happen, we have been working closely with Nigeria’s National Primary Health Care Development Agency on recognising Nigeria’s vaccine certification, which we have now done.”

Oil prices up more than 4% for the week on the back of the global energy crunch

Oil fell on Monday ahead of an OPEC+ supply policy meeting that may decide whether a recent rally in prices can be sustained as the world fitfully recovers from the Covid-19 pandemic.

OPEC+ on Monday decided to maintain an agreement to increase oil production only gradually, ignoring calls from the United States and India to boost output as the world economy recovers, though patchily, from the coronavirus pandemic.

Moody’s Investors on Thursday increased their oil price forecast for the medium term to $50-$70 a barrel range, returning to its outlook before the pandemic, on the back of expected restraint in production growth and continuous rebound in demand.

Oil prices rose on Friday, up more than 4% on the week as a global energy crunch has boosted prices to their highest since 2014 and prompted China to demand increased coal production. Brent had a weekly growth of 4.86%.

In the coming week, oil prices are expected to be bullish buoyed by global energy crunch.

Currency Market

For most of the trading session last week the Naira depreciated at the I & E FX window, which continued at the end of the week. On a week-on-week (W-on-W) basis, the Naira fell by +0.22% to N414.30/US$ at the close of trading on Friday.

The Naira closed the week at $/N414.30 at the I&E FX window, at the NAFEX (spot market) it closed at $/N412.71 as of 7th September 2021.

More of the same is expected in the week ahead as the Naira is anticipated to continue to hover around N406/$1-N415/$1 threshold in the NAFEX window.

Money Market

Trading was mixed for most of the session last week, we had single-digit rates and double-digit rates supported by inflow and outflow of liquidity in the markets

However, at the close of the session on Friday, money market rates closed in double digits, at 14.00% and 14.5% for open buy-back (OBB) and overnight rates (O/N) respectively. On a W-o-W basis, OBB fell by -6.67% while O/N also dropped by -7.94%.

Funding rates are expected to trade in double digits trend in the coming week in the absence of any inflow.

Treasury Bills Market

The bills market started the previous week on a quiet note, however, for a major part of trading, we saw mixed sentiment across the market.

At the close of the market on Friday, average benchmark yields for T-bills closed at 5.27%, OMO bills at 6.47%, and CBN’s special bills closed at 6.04%. Posting a W-o-W fall of -0.36% for the T-bills, while OMO bills and CBN’s special bills rose W-o-W by +2.41%, and +0.08% respectively.

We expect activity next week to be dictated by the market liquidity situation.

FGN bond and Eurobond Market 

The FGN bond market started the previous week on a bullish note, however, the bullish sentiment was not sustained throughout the week.

The overall average benchmark yields closed at 8.13% at the close of trading at the end of the week.

The Eurobond market has had a bearish bias for most of the trading session last week, influenced majorly by the higher US Treasury yields as investors moved to that market to take advantage of the higher yields.

At the close of the trading on Friday, average benchmark yields fell by -0.09% from the previous session to 6.40%

Market sentiment is expected to remain soft in the near term in the absence of any trigger.

Nigerian Capital Market 

Activity on the local bourse last week was positive as the benchmark index closed positive with +0.10% with some bargain hunting activities and sell-off in the insurance sector. The Nigerian Stock Exchange gained N340.287bn, year-to-date return moderated to +1.48%, while the market capitalization settled at N21.30 trillion.

The volume of shares traded declined by -0.34% while the value of stocks traded on the exchange last week advanced by +35.71% respectively.

Sectoral performance across sectors tracked was positive last week as the NGX Banking was the highest gainer for the previous week with +4.53%. NGX Insurance recorded the highest weekly loss with -1.51%. NGX Oil and Gas NGX, NGX-IND, and NGX Consumer Goods closed positive with +0.24%, +0.11% and -0.51% respectively.

Market breadth for the week closed positive with 42 gainers led by UPL and FBNH as against 26 losers led by CORNERST and MORISON

In the coming week, we expect the possibility of sustained bargain hunting as investors look to take advantage of good bargains; however, press releases from listed companies and other macroeconomic developments are likely to impact investors’ decisions.

In addition, we expect investors to monitor the movement of yields in the fixed income market.