Nigeria’s stock market recovered from Monday’s losses on Tuesday, with the market capitalisation appreciating by N1.6 billion to close at N11.462 trillion.
This is as a result of the 26 stocks that recorded gains at Tuesday’s trading.
The market had depreciated on Monday after seven consecutive days of price rally, but yesterday’s gains lifted the Nigerian Stock Exchange (NSE) All-Share Index to close higher at 30,736.88.
Price gainers were led by Linkage Assurance Plc with 9.8 per cent gains. It was trailed by Redstar Express Plc with 9.0 per cent while Nigerian Aviation Handling Company Plc chalked up 8.3 per cent, just as Royal Exchange Plc and Oando Plc garnered 7.4 per cent and 6.8 per cent in that order.
At the end trading on Tuesday, 10 stocks dipped in value. They were led by MCNichols Plc with 9.3 per cent, followed by Sovereign Trust Insurance Plc with 8.3 per cent while the Cement Company of Northern Nigeria Plc shed 7.0 per cent, with WAPIC Insurance Plc going down by 4.7 per cent among others.
The activity level at the NSE fell as volume and value traded declined by 51.0 per cent and 56.0 per cent to 245 million shares and N2.4 billion.
In terms of volume, the most active stocks were Diamond Bank (71.6 million shares), Access Bank (27.0 million shares) and GTBank (27.0 million shares while the top traded stocks by value were GTBank(N848.0 million), Zenith Bank (N236.0 million) and Seplat (N193.8 million).
Performance on sectoral basis was mixed with two sectors appreciating while three declined.
The NSE Oil & Gas Index advanced the most, up 1.7 per cent while the NSE Banking Index followed with a rise of 0.8 per cent.
However, the NSE Industrial Goods Index shed the most, down 2.5 per cent, while the NSE Consumer Goods Index and NSE Insurance Index shed 0.3 per cent and 0.4 per cent respectively.
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has raised the alarm that Nigeria may return to the pre-2005 Paris Club debt level, if the Federal Government fails to come up with immediate measures to address the rising debt profile.
The MPC stated this on Tuesday in Abuja after its first meeting of the year.
It would be recalled that in October 2005, Nigeria and the Paris Club announced a final agreement for debt relief worth $18bn and an overall reduction of Nigeria’s debt stock by $30bn.
The deal was completed on April 21, 2006, when Nigeria made its final payment and its books were cleared of any Paris Club debt.
Statistics from the debt management office showed that Nigeria’s debt profile as at June 2018 stood at $22.08 billion.
However, key officials of the President Muhammadu Buhari’s administration have consistently dismissed fears raised by Nigerians over the rising debt profile.
Prominent among these Buhari administration officials are the Vice President, Yemi Osinbajo and the Minister of Power, Works and Housing, Babatunde Raji Fashola.
Speaking on behalf of the MPC on Tuesday, CBN Governor, Mr Godwin Emefiele, said that the committee noted the rising debt profile and called for caution.
He said: “On external borrowing, the committee noted the increase in debt level advising for caution, noting that it could fast be approaching the pre-2005 Paris Club level.”
According to Emefiele, the committee noted that while the real Gross Domestic Product grew by 1.81 per cent during the third quarter of 2018, the persistence of herdsmen attacks on farmers, cattle rustling and flooding in parts of the country affected agricultural and livestock output.
He said in view of this, the output for growth remained fragile as the late implementation of the 2018 budget and the residual impact of flooding and security challenges constituted headwinds to growth.
The MPC called for the effective implementation of the 2018 capital budget and the Economic Recovery and Growth Plan in other to stimulate economic activities.
It also hammered on the need for improvements in the security situation in the country as well as continued stability in the foreign exchange market to enhance aggregate demand and growth.
“The committee observed that the near term risk to inflation remain the impact of flooding on agricultural output, insecurity on food producing belts in the country, exchange rate pass through to inflation due to the weakening of oil price and campaign-related spending towards the 2019 general elections.
“Accordingly, the Monetary Policy Committee called on the Federal Government to sustain its efforts towards improving security to ease supply chain bottlenecks.
“The committee recommended that the Federal Government should focus investment on infrastructure and urge the Federal Government to sustain the pace towards addressing infrastructure deficit in Nigeria.
“It noted that the immediate impact of this on the GDP will be slow in coming but it will expand the economy, reduce unemployment and increase aggregate demand in a more sustainable manner”, Emefiele said.
The MPC also backed the plan by the Federal Government to raise more revenue through Value Added Tax, saying the move would help to reduce pressure on government expenditure.
“The committee also noted the attempts by the government to broaden the base of the Value Added Tax and urge the authorities to expedite action in that effect, arguing that increased tax collection will reduce pressure on government expenditure and create fiscal buffers to improve macroeconomic management,” he added.
On the recent increase in foreign capital inflow into the country despite the political risks, Emefiele said this was based on the confidence of the international community in the country’s macroeconomic management.
He said: “The observed and recent high foreign capital inflow into the Nigerian economy despite the perception of political risks is based on the confidence of the international community in the country’s macroeconomic management and provides a compelling reason for the committee to await clarity on the macroeconomic performance after the general elections in February and March.”
Nigeria’s foreign exchange reserves would have crashed to as low as $2bn if the Central Bank of Nigeria had not restricted importers from accessing forex for the importation of about 42 items, the Federal Government declared on Tuesday.
According to the government, the release of the items on the foreign exchange restriction list by CBN has contributed in shoring up the country’s reserves to about $40bn.
In his address at an event organised by Guinness Nigeria Limited to honour farmers in Abuja, the Minister of Agriculture and Rural Development, Chief Audu Ogbeh, shared his recent conversation with the CBN Governor, Godwin Emefiele, and stated that the government was pleased that the apex bank was resolute in its decision on the forex restriction list, despite the barrage of attacks.
Ogbeh said, “I was with the (CBN) governor on Friday last week and I said to him you remember I met you at Frankfurt airport in early 2015. We were on our way to the United States and I saw him and said, ‘how are you’, and he said, ‘fine, but I’m being bashed around at home because I stopped 41 items on the forex restriction list.’
“He (Emefiele) came under a barrage of attacks and I said to him that I am on his side because the bank should have done this 20 years ago not now. So, I told him that when I get back from the trip, I will call a press conference to defend him. And I did. Because I saw the logic in what he was doing.
“On Friday, he (Emefiele) said to me that even those that criticised him, including non-Nigerians, now say to him that they love what he did on that issue. So, if he had been weak and had succumbed to the bashing, by today, we would have $2bn as foreign reserves, but right we now have about $40bn.”
Ogbeh also noted that it would be foolish to devalue the local currency as a result of its fall against the United States dollar, adding that it was better to cut down on imports.
The minister said the massive importation of various commodities almost crippled the domestic economy, as the country’s forex reserves were heavily depleted, especially when crude prices started to nosedive.
On Monday, News reports that the CBN might increase the items on the foreign exchange restriction list from 42 to 50 in order to boost local production and stimulate the export market.
Emefiele stated that the CBN would get more aggressive in ensuring that more items being imported into the country were added to the forex restriction list.
He said, “To put it in proper perspective, by the time you dimension the size of the foreign exchange we use in importing petroleum products into the country, it is at least one-third of the foreign exchange the CBN spends to import items into Nigeria today.
“By the time we add also the 42 items that we have, which certainly we are going to increase from 42 may be to 50 or more in due course because we are going to get more aggressive in ensuring that more and more food items that are being imported into this country, are added to the FX restriction list.”
Meanwhile, Ogbeh told guests at the event that the purchase of sorghum by Guinness from farmers in Nigeria had created wealth in rural areas and had contributed in reducing the unproductive migration of youths from villages to cities.
“I commend Guinness for buying sorghum locally from our rural farmers and this is because every time you import, you are importing poverty and exporting wealth and you are also importing danger. But by making purchases from our rural farmers, the wealth is being moved to these villages,” he said.
The gaining streak the Nigerian capital market has enjoyed over some trading days was pushed back on Monday, with investors losing N102 billion.
The push back was occassioned by weaker tech, industrial and oil and gas stocks, just as sell-offs in the stocks sent the equity benchmarks lower.
The market, which gained N723 billion in five consecutive days, saw 14 per cent of the gains wiped off on Monday as the market capitalisation of equities listed on the Nigerian Stock Exchange (NSE) dropped to N11.460 trillion from N11.562 trillion on Friday.
The All Share Index declined by 0.88 per cent to settle at 30,732.72 basis points from the 31,005.17 bps recorded on Friday.
The year-to-date return settled at -2.2 per cent.
499.212 million shares valued at N5.531bn exchanged hands in 3,874 deals.
At the end of trading on Monday, 13 firms gained against the 18 laggards.
Oil and gas stocks led by Seplat Petroleum Development Company Plc recorded the biggest drag on the Exchange with a 4.55 per cent decline.
Other oil and gas stocks that recorded declines were 11 Plc and Eterna Plc.
Bank stocks led by Unity Bank Plc recorded a 0.14 per cent decline.
While Unity Bank saw its share price drop by 4.40 per cent, three other bank stocks ― Wema Bank Plc, Diamond Bank Plc and Guaranty Trust Bank Plc ― each recorded respective declines of 1.61 per cent, 0.95 per cent and 0.78 per cent.
Insurance and industrial stocks however recorded gains.
The industrial sector gained 0.97 per cent but witnessed sell-offs in its major stocks ― Dangote Cement Plc and Lafarge Africa Plc.
Lafarge’s share price dropped by 3.13 per cent, while Dangote’s share price fell by 2.51 per cent.
Losses in Sovereign Trust Insurance Plc and Mutual Benefits Assurance Plc, notwithstanding, insurance index gained 1.51 per cent.
The consumer goods index saw no changes at the end of trading on the floor of the Exchange on Monday.
Vice President Yemi Osinbajo says there is a need to invest in agriculture to take the nation out of poverty.
He made the recommendation on Thursday in Abuja while launching the Green Imperative, a project of the Federal Government in collaboration with the Brazilian government.
“Frankly, we believe we cannot bring our nation out of poverty, especially the large numbers of the poor without significant investments in agriculture and, of course, mechanised agriculture,” the Vice President was quoted as saying in a statement by his media aide, Mr Laolu Akande.
He added, “But also because we know the sheer number of young people who are coming into our population in the next 10 – 15 years, will certainly not only need to be fed, but will also need to have jobs, and the sort of jobs that these young people will want will not be jobs requiring hoes and cutlasses.”
Professor Osinbajo noted that the young generation would need more dignified jobs while the government would be able to achieve more with mechanisation.
He stressed that the only way the nation can make the quantum leap required to advance its economy and provide the number of jobs needed was simply what the government was doing.
The Vice President highlighted the progress made so far, saying there would be a combination of service centres where technical capacity and training would take place.
According to him, the major dividends of all these are the hundreds of thousands of quality jobs that young men and women will be able to access.
“Today, we have made a significant difference in our journey, not just in self-sufficiency in food production, but also in creating the kinds of jobs that we could have from agriculture,” said Osinbajo.
“Also crucial is the fact that the private sector is an important component of this particular enterprise … we have ensured that this will be private sector driven and we have here today, both Nigerian and Brazilian investors committed to investing and working on this project.”
He said President Muhammadu Buhari’s dream of self-sufficiency in food production has moved closer to realisation, as the nation would be able to produce food for its people in the next couple of years.
The Vice President was also hopeful that there would be employment not just in agriculture, but in all of the agro-allied value chain and manufacturing.
Investors at the Nigerian Stock Exchange (NSE) on Wednesday gained N120.5 billion as the stick market continued its appreciation for the past five consecutive trading days.
The market capitalisation of listed equities jumped from N11.238tn on Tuesday to N11.359tn on Wednesday, with the All Share Index rising by 1.07 per cent to 30,460.68 basis points.
The gains, analysts say were driven by price appreciation in Dangote Cement Plc, Guinness Nigeria Plc and United Bank for Africa Plc.
The gains moderated the market’s year-to-date loss to -3.1 per cent, while investor sentiment strengthened to 1.5x from 1.4x on Tuesday.
Activity level was however mixed as volume traded increased by 1.9 per cent to 305.802 million units, while value traded declined by 35.3 per cent to N2.102bn.
Top traded stocks by volume were Diamond Bank Plc (141.2 million units), Fidelity Bank Plc (18.6 million units) and Guaranty Trust Bank Plc (17.4 million units) while the top traded stocks by value were GTB (N577.7m), Zenith Bank (N357.1m) and Diamond Bank (N296.6m).
Performance across sectors was also mixed with three sectoral indices closing in the green.
The insurance index led the gainers with a 2.32 per cent gain; the industrial goods index rose by 1.70 per cent, and the consumer goods index advanced by 0.24 per cent.
On the other hand, the banking sector was the major loser, with a 0.68 per cent depreciation, while the oil and gas index shed 0.01 per cent.
After Wednesday trading, 24 stocks advanced while 16 others recorded losses.
Topping the gainers were Sovereign Trust Insurance Plc, Veritas Kapital Assurance Plc, Guinness, Honeywell Flour Mill and NEM Insurance, having their share prices gaining 10 per cent, 10 per cent, 9.65 per cent, 9.57 per cent and 9.57 per cent, respectively.
However, Beta Glass Plc, Northern Nigeria Flour Mills Plc, Resort Savings and Loans Plc, PZ Cussons Nigeria Plc and Neimeth International Pharmaceuticals Plc, led the losers, with their respective share prices declining by 10 per cent, 9.20 per cent, 8.82 per cent, 8.33 per cent and 4.69 per cent.
Nigeria has contributed 97 out of the 360 companies listed in the second edition of the London Stock Exchange Group’s Companies to Inspire Africa report.
The report, which identifies 360 companies in 32 countries in Africa, was launched on Wednesday with Kenya also contributing 66 companies.
“Nigeria further built on its leading position established in the 2017 report with strong representation from the industry and technology and telecoms sectors,” the LSEG said in an emailed statement.
The report, with seven major sectors represented, featured companies including small entrepreneurial businesses to well-established corporations.
According to the report, consumer services, industry and agriculture are the three biggest sectors, contributing over 50 per cent of the companies featured, while technology and telecoms, and financial services together represent over 25 per cent of firms.
Healthcare and education and renewable energy also featured strongly.
Some of the Nigerian firms listed are Kian Smith Trade & Co Limited, which is building the country’s first gold refinery; FSDH Merchant Bank Limited; Ladol Integrated Logistics Free Zone Enterprise; Jumia; Asharami Synergy Plc, BudgIT Foundation; Interswitch Limited; Ensure Insurance Plc; Lagos Business School, Pan-Atlantic University; North South Power Company Plc; Leadway Assurance Company Limited; Farmcrowdy Limited and Venia Group.
According to the Chief Executive Officer, LSEG, David Schwimmer, the firms listed in last year’s report had already realised significant progress and achievements in the last 12 months in a variety of ways, including pursuing IPOs and issuing bonds to grow, while some had also undertaken cross-border expansion, both within the African continent and globally.
Schwimmer said: “London Stock Exchange Group’s ‘Companies to Inspire Africa’ report showcases inspirational and entrepreneurial businesses from across the African continent, representing a wide variety of industries and countries. It is particularly encouraging to see the increasing influence of women in leadership roles in these fast-growing companies, playing a pivotal role in shaping the future of African business.
“These high-growth companies have the potential to transform the African economy and become tomorrow’s job creators. At LSEG, we are committed to helping companies realise that potential and we are pleased to highlight and celebrate the company success stories behind one of the world’s fastest growing markets.”
The report was produced in partnership with African Development Bank Group, CDC Group, PwC and Asoko Insight, and the report is sponsored by Instinctif Partners and Stephenson Harwood.
A report from the National Bureau of Statistics (NBS) has shown that Nigeria recorded crude oil export worth N11.5 trillion in nine months, from January to September 2018.
The figure is a 48.01 per cent rise from N7.77 trillion recorded in similar period in 2017.
The figure is also over N2 trillion more than the N9.12 trillion budgeted for 2018 and about N3 trillion more than the 2019 budget proposal.
Data from the NBS Foreign Trade Statistics for the Third Quarter of 2018, showed that crude oil export in the nine-month period accounted for 81.8 per cent of total exports recorded in the Nigerian economy in 2018.
According to the report, crude oil export in the first quarter of 2018, appreciated by 51.05 per cent compared to N2.37 trillion recorded in the first quarter of 2017; while in the second quarter of 2018, crude oil export stood at N3.77 trillion, appreciating by 55.14 per cent from N2.43 trillion recorded in the same period of 2017.
The report also showed that third quarter 2018 crude oil export appreciated by 39.17 per cent from N2.97 trillion recorded in third quarter 2017 to N4.15 trillion.
“Crude oil exports in third quarter 2018 was 10.03 per cent more than the value recorded in second quarter 2018 and 39.5 per cent higher than the value recorded in third quarter 2017. Other oil products export in third quarter 2018 was 5.3 per cent more in value than second quarter 2018 and 12.68 per cent higher than third quarter 2017,” the NBS report noted.
Breaking down exports in the third quarter of 2018, the report stated that crude oil and Liquefied Natural Gas [LNG], export stood at N4.147 trillion, N469.87 billion respectively, other petroleum gases export stood at N27.85 billion.
Others are liquefied butane and liquefied propane export which stood at N17.66 billion and N13.73 billion respectively; kerosene type jet fuel export stood at N7.4 billion, while the lubricating oil export stood at N6.84 billion.
The report also named India as the highest importer of Nigeria’s crude oil, purchasing N764.88 billion worth of the commodity; followed by Nigeria’s crude oil export of N522.12 billion and N500.31 billion to Spain and France respectively.
Furthermore, the NBS disclosed that crude oil from Nigeria was exported to South Africa, Netherlands, Indonesia, Brazil and United Kingdom, valued at N335.28 billion, N276.37 billion, N256.3 billion, N226.2 billion and 206.3 billion respectively.
United States and Canada bought Nigeria’s crude oil worth N201.65 billion and N199.01 billion respectively in the third quarter of 2018.
The report noted: “Nigeria’s external trade totalled N9.026 trillion during the third quarter of 2018. Compared to the value of N6.903 trillion recorded against the second quarter, a rise of N2.122 trillion or 30.7 per cent was indicated.
“The total export component of this trade was N4.854 trillion, representing an increase of 7.8 per cent over second quarter 2018 and 35.7 per cent over third quarter 2017.”
The Central Bank of Nigeria (CBN) on Friday, intervened in the Retail Secondary Market Intervention Sales by injecting the sum of $263 million, the first in 2019.
A statement by the Director, Corporate Communications at CBN, Isaac Okorafor, on Friday, indicated that the apex bank also injected CNY39m into the sector for a combination of spot and short-tenored forwards, arising from bids received from authorised dealers.
According to figures from CBN, the US dollar-denominated interventions were for requests in the agricultural and raw materials sectors, while the Yuan sale was for payment of Renminbi-denominated letters of credit for agriculture as well as raw materials.
According to Okorafor, the move was in furtherance of the CBN Governor’s commitment to ensuring foreign exchange liquidity in the system as well as boosting trade and production.
He revealed that the CBN would sustain its intervention through the sale of foreign exchange to all segments of the market to meet all legitimate foreign exchange demand while also striving to achieve exchange rate stability in the market in the weeks ahead.
Okorafor also disclosed that the CBN Governor, Godwin Emefiele, will further unfold the bank’s plans for the year during the first Monetary Policy Committee meeting for the year scheduled to hold between 21st and 22nd January, 2019.
The Debt Management Office (DMO) has revealed that Nigeria’s total debt portfolio leaped from N12.12 trillion as of June 30, 2015 to N22.43 trillion as of September 30, 2018.
According to data from the DMO, the total debt of the country rose by 85.07 percent since President Muhammadu Buhari took office on May 29, 2015, representing N10.31 trillion.
Of the total debt, the external component of both the Federal Government and state governments’ debts including that of the Federal Capital Territory stood at $21.59 billion from $10.32 billion as of June 30, 2015, while the domestic debt of both the Federal Government and the state governments stood at N15.81tn.
The data also showed that the domestic debt of the Federal Government stood at N12.29 trillion as of September 30, 2018 from N8.4 billion as of June 30, 2015 while the domestic debts of the state’s and the FCT stood at N1.69 trillion.
The DMO added that the debt statistics as of September 30, 2018, was only slightly different from the statistics as of June 30, 2018.
“External debt declined by 2.02 per cent to $21.59bn due largely to the redemption by Nigeria of a $500m Eurobond which matured on July 12, 2018.
“The Eurobond which was issued for a tenor of five years in 2013 was the first Eurobond maturity for Nigeria and Nigeria’s ability to repay it seamlessly boosted Nigeria’s position as a good credit in the International Capital Market.
“The domestic debt of the FGN, states and the FCT grew by 1.19 per cent from N15.63tn in June 2018 to N15.8tn in September 2018. This increase of N185bn was attributed to the FGN (N135bn) and states and FCT (N50bn).
“The combination of an increase in the level of domestic debt and a decrease in the external debt stock resulted in a slight shift in the portfolio composition.
“As of September 30, 2018, the share of domestic debt was 70.51 per cent compared to 69.83 per cent in June 2018.
“This trend is expected to be reversed in Quarter Four 2018 as the new external borrowing of N849bn (about $2.78bn) provided in the 2018 Appropriation Act is expected to be raised within the quarter”, the DMO said.