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U.S Adds 211,000 Jobs to Payroll in April

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  • U.S Adds 211,000 Jobs to Payroll in April

The U.S. labour market rebounded in April, after rising lower than previously projected in March.

The economy added 211,000 jobs to beat economists projection of 190,000 jobs, a Labour Department report showed on Friday.

While the unemployment rate is now the lowest since May 2007, wages were a soft spot in the report, climbing 2.5 percent from a year earlier.

The brighter figures follow a weaker-than-expected reading in March, when payrolls were partly depressed by a snowstorm that slammed the Northeast during the survey week. Strengthening business sentiment might be translating into hiring, and the data should keep Federal Reserve policy makers on track to raise interest rates in the coming months after officials declared the first-quarter slowdown to be temporary.

“Labor market conditions remain robust and continue to tighten,” said Ward McCarthy, chief financial economist at Jefferies LLC in New York, who had forecast a payrolls gain of 220,000. “This data will keep the Fed on track for a preferred 2017 normalization timeline of rate hikes in June and September and the first step toward balance-sheet normalization in December.”

The report showed revisions to the previous two months subtracted 6,000 jobs from payrolls. The first quarter saw a 176,000 average monthly increase after a 187,000 average pace in 2016.

Fed Forecast

The unemployment rate compares with economists’ projection for 4.6 percent. It’s now below the 4.5 percent level where Fed policy makers in March had forecast it would reach in the fourth quarter, based on their median estimate.

Employment gains were broad-based though concentrated in services in April. Leisure and hospitality registered a 55,000 increase, education and health services was up 41,000 and financial activities rose by 19,000. Retail rebounded with a 6,300 increase following a revised loss of 27,400.

Manufacturing and construction jobs rose but at a weaker pace than at the start of 2017. Factories added 6,000 jobs after a 13,000 gain, while construction workers rose by 5,000 following 1,000 in March.

Total private employment, which excludes government agencies, climbed by 194,000 in April, following a 77,000 advance the prior month. Government payrolls rose by 17,000 in April, including a 6,000 decline at federal agencies and 23,000 increase at state and local governments.

Wage growth accelerated on a monthly basis to 0.3 percent from a revised 0.1 percent gain in March. At the same time, the 2.5 percent year-over-year gain in average hourly earnings was the weakest since August, following a 2.6 percent rise in March.

The employment cost index increased 0.8 percent in the first quarter for the best performance since the end of 2007, a separate Labor Department report showed last week.

Healthy Outlook

Absent faster wage growth, consumers have retained a healthy outlook as they’ve largely socked away savings from income gains including stronger stock and housing prices. Weaker household purchases in the first quarter reflected a slowdown in automobile sales, which are easing to a more sustainable rate, and smaller home-heating bills owing to unusually warm weather.

“The underlying consumer fundamentals remain positive because the labor market remains positive,” said McCarthy of Jefferies.

Dwindling labor-market slack also is helping workers gain bargaining power. Beyond the broad unemployment rate, measures of spare workforce capacity that are favored by Trump administration officials showed further progress toward pre-recession levels in April.

The underemployment rate, a measure that includes those working part-time who would take a full-time job if it were available, dropped to 8.6 percent, the lowest since November 2007, just before the last recession began. It was from 8.9 percent in March.

The number of discouraged workers fell by 5,000 in April to 460,000, and was 363,000 the month the last recession started. The participation rate, which indicates the share of working-age people who are employed or looking for work, decreased to 62.9 percent from 63 percent the prior month.

The seasonally adjusted number of people working part-time who would prefer a full-time job fell to 5.27 million, the lowest since April 2008, moving closer to the 4.62 million reading from December 2007.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Markets

SEC To Ban Unregistered CMOs From Operating By Month End

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The Securities and Exchange Commission (SEC) says it will stop operations of Capital Market Operators (CMOs) that are yet to renew their registration on May 31, 2021.

This was contained in a circular signed by the management of SEC in Abuja on Monday.

On March 23, SEC had informed the general public and CMOs on the reintroduction of the periodic renewal of registration by operators.

The commission noted that the reintroduction of the registration renewal was due to the need to have a reliable data bank of all the CMOs registered and active in the country’s capital market.

“To provide updated information on operators in the Nigerian Capital Market for reference and other official purposes by local and foreign investors, other regulatory agencies and the general public, to increasingly reduce incidences of unethical practices by CMOs such as may affect investors’ confidence and impact negatively on the Nigerian Capital Market and to strengthen supervision and monitoring of CMOs by the Commission,” SEC explained.

According to the circular, the commission said CMOs yet to renew their registration at the expiration of late filing on May 31, would not be eligible to operate in the capital market.

It explained that CMOs were required to have completed the renewal process on or before April 30, however, the commission said late filing for renewal of registration would only be entertained from May 1 to May 31.

SEC also said that asides from barring the CMOs who failed to comply accordingly, their names would be published on its website and national dailies.

It added that names of eligible CMOs would be communicated to the relevant securities exchanges and trade associations.

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Crude Oil

A Threat to Revenue As Nigeria’s Largest Importer of Crude, India slash Imports By $39.5B

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Nigeria’s revenue earning capacity has come under threat following the reduction of importation of crude oil by India.

India, Nigeria’s largest crude oil importer, reduced crude oil imports by $39.5bn in April, compared to the same time the previous year, data from India’s Petroleum Planning & Analysis Cell showed.

According to the Indian High Commission in Nigeria, India’s crude oil imports from Nigeria in 2020 amounted to $10.03bn.

This represented 17 percent of Nigeria’s total crude exports for the year according to the Nigerian National Petroleum Corporation, as quoted by OilPrice.com.

As Nigeria’s largest importer of crude oil, lockdowns in India’s major cities from the COVID-19 surge in April had ripple effects on Nigeria’s oil sales.

The NNPC was prompted to drop the official standard price of its main export streams, Bonny Light, Brass River, Erha, and Qua Iboe, by 61-62 cents per barrel below its April 2021 prices. They traded at $0.9, $0.8, $0.65, $0.97 per barrel respectively, below dated Brent, the international benchmark, as Oilprice.com showed.

India had been buying the not-too-light and not-too-heavy Nigerian crudes that suited its refiners.

Reuters reported that the Indian Oil Corporation’s owned refineries were operating at 95 percent capacity in April, down from 100 percent at the same time the previous month.

An official at the IOC was quoted as saying, “If cases continue to rise and curbs are intensified, we may see cuts in refinery runs and lower demand after a month.” Hundreds of seafarers risked being stuck at sea beyond the expiry of their contracts, a large independent crude ship owner reportedly told Bloomberg.

India reportedly bought more American and Canadian oil at the expense of Africa and the Middle East, reducing purchases from members of the Organisation of the Petroleum Exporting Countries to around 2.86 million barrels per day.

This squeezed the group’s share of imports to 72 percent from around 80 percent previously, as India’s refiners were diversifying purchases to boost margins, according to Reuters.

India also plans to increase local crude oil production and reduce import expenses as its population swells, according to Bloomberg.

A deregulation plan by the Narendra Modi-led government to boost national production to 40 million tonnes of crude oil by 2023/2024, an increase of almost eight million tonnes, had already been initiated.

According to Business Today, an Indian paper, the country currently imports 82 percent of its oil needs, which amounted to $87bn in 2019.

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Energy

Invest Africa and DLA Piper Partner to Support ESG Best Practice in African Renewable Energy Projects

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Invest Africa - Investors King

The global law firm, DLA Piper, has partnered with Invest Africa, the leading trade and investment platform for African markets, to support the development of ESG best practice in African renewable energy projects.

Clear Environmental, Social and Governance (ESG) targets and measurements have become an increasingly important part of fundraising as investors seek to align their portfolios with sustainable growth. For a continent boasting ample natural resources, this presents a significant opportunity for Africa’s green energy sector. However, renewable does not always equal sustainable and developing and articulating ESG metrics can pose a significant challenge to projects as they prepare investment rounds.

The project will assemble experts from the worlds of impact investment, development finance and law. Across a series of online meetings, participants will discuss strategies to improve ESG practices in African renewable projects from both a fundraising and operational perspective.

Amongst those speaking in the inaugural session on Thursday 13th May are Cathy Oxby, Chief Commercial Officer, Africa GreencoDr. Valeria Biurrun-Zaumm, Senior Investment Manager, DEGOrli Arav, Managing Director – Facility For Energy Inclusion (FEI) – Lion’s Head Global PartnersBeatrice Nyabira, Partner, DLA Piper Africa, Kenya (IKM Advocates) and Natasha Luther-Jones, Partner, Global Co-Chair of Energy and Natural Resources, International Co-Head, Sustainability and ESG, DLA Piper.

Veronica Bolton-Smith, COO of Invest Africa said, “Africa is particularly vulnerable to the impact of climate change despite contributing very little to global emissions. As the price of renewables fall, they will form an ever more important part of Africa’s electrification. In this context, it is essential that projects be given the tools to apply best practice in ESG not only from an environmental perspective but also in terms of good governance, fair working conditions and contribution to social inclusion. I look forward to working closely with DLA Piper on this important topic.”

Natasha Luther-Jones, Global Co-Chair Energy and Natural Resources and International Co-Head Sustainability and ESG at DLA Piper also commented, “Climate change is one of the biggest challenges companies, and people, face today and when we look at its reduction – whether that be in how we power our devices, what we eat or how we dress, where we live or how we work – all roads come back to the need to increase the amount of accessible, and affordable, clean energy. However, renewable energy companies are not automatically sustainable as sustainability is a focus on all ESG factors, not just environmental. We know the need for renewable energy is only going to continue to rise, and therefore so will the number and size of renewable energy companies. The additional challenge is to make sure they are truly sustainable organisations and that’s what we’re excited about discussing during the webinar.”

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