Bearish Trends: Stock Market Reacts to Rising Petrol Prices

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Bearish Trends: Stock Market Reacts to Rising Petrol Prices - The stock market closed bearish last weekend, impacted by soaring petrol prices, which rose from approximately N600 to between N855 and N1,000 per litre. This spike has drawn criticism from the private sector due to its potential negative effects on businesses. Analysts suggest that government economic reforms are still insufficient to foster recovery and growth. The Nigerian Exchange Limited's All-Share Index (ASI) fell by 0.2%, closing at 96,433.53 points, down from 96,579.54 points the previous week. Market capitalization also declined by over N83 billion, settling at N55.394 trillion. Notable profit-taking in Dangote Sugar (down 5.5%), Zenith Bank (down 2.0%), and WAPCO (down 3.5%) contributed to this decline. Year-to-date (YTD) returns moderated to +29.0%, while trading activity dipped significantly, with total volume and value dropping by 23.7% and 3.3% Week on Week, respectively. Sector performance varied, with the Insurance Index declining by 4.5%, while the Oil and Gas Index rose by 1.5%. Looking ahead, analysts from Cordros Research predict cautious trading and selective buying as investors await broader market signals. Meanwhile, InvestData Consulting anticipates mixed sentiment driven by bargain hunting and sector rotation, urging investors to capitalize on price corrections amid ongoing market volatility.

NTBs: Nigeria's Government Bonds Gain Investor Confidence - The Central Bank of Nigeria (CBN) has successfully raised a substantial N9.27 trillion through Nigerian Treasury Bills (NTBs) between January and August 2024. This surge in NTB issuance reflects growing investor confidence in the Nigerian government's debt instruments and a desire for higher returns. The CBN has been offering NTBs with longer maturities to meet this demand, which has led to increased investor participation. The stop rates for these bills have also risen, indicating a higher risk premium for longer-term investments. The government's use of NTBs to finance budget deficits and fund projects has been a key factor in driving demand for these securities. The CBN's monetary policy measures, such as raising interest rates, have also contributed to the attractiveness of NTBs for investors seeking higher returns. Overall, the success of the CBN's NTB issuance program demonstrates the strength of the Nigerian debt market and the government's ability to attract foreign and domestic investors.

Capital Market Town Hall Meeting Set for October 7th - ThinkBusiness Africa and the African Business Convention are hosting a special town hall meeting on 7^th of October, 2024 to discuss the future of Nigeria's capital market. The event will feature a keynote address by Dr. Emomotimi Agama, Director General of the Securities and Exchange Commission (SEC). Discussions at the conference will explore the challenges and opportunities facing the Nigerian capital market and discuss potential solutions.

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