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Forex

Euro Halts Advance as Carmakers Weigh on Stocks

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Euro
  • Euro Halts Advance as Carmakers Weigh on Stocks

The euro headed for its first decline in three days as data showed the region’s economy cooling at the start of a week packed with corporate results and a Federal Reserve rate decision. Stocks were dragged down for a second day by carmakers amid a collusion probe.

The common currency halted the advance that saw it hit a two-year high after a composite Purchasing Managers’ Index fell in July to a six-month low, while the U.S. dollar traded sideways. Automakers extended a slump as European Union and German authorities said they are studying possible collusion among German producers. Crude gained as Saudi Arabia said it would make deep cuts to its crude exports in August. Bonds were mixed.

Earnings from industry bellwethers including Amazon.com Inc. and GlaxoSmithKline Plc and central bank policy discussions are set to provide the latest tests for the equity bull market, which has propelled the value of shares globally to $78 trillion. The euro-area manufacturing figures indicate that gross domestic product is expanding at the weakest pace in six months, adding further doubts about the sustainability of the stock rally at a time when the strong euro is weighing on exporters.

Investors are also bracing for further surprises from Washington after President Donald Trump sought to impose order in his White House in the face of a widening Russia probe. Senior adviser Jared Kushner confirmed four contacts with Russians during his father-in-law’s presidential campaign and the transition, but he described the encounters as unmemorable. Donald Trump Jr. and former Trump campaign Chairman Paul Manafort will go before Senate committees on Wednesday.

These are the notable moves in markets:

Stocks

  • The Stoxx Europe 600 Index fell 0.4 percent at 8:01 a.m. in New York to the lowest in more than three months on a closing basis.
  • The U.K.’s FTSE 100 Index slumped 1 percent in the largest decrease since June 15.
  • Germany’s DAX Index fell 0.4 percent to the lowest in more than three months.
  • The MSCI Emerging Market Index rose 0.3 percent to the highest in more than two years.
  • Futures on the S&P 500 Index fell 0.2 percent. The underlying gauge closed flat on Thursday and Friday last week.

Currencies

  • The euro fell 0.1 percent to $1.1647.
  • The British pound rose 0.3 percent to $1.3039, the biggest gain in more than a week.
  • The Bloomberg Dollar Spot Index was little changed at about the lowest in almost 15 months.
  • The Japanese yen rose 0.3 percent to 110.82 per dollar on its fifth straight advance.

Commodities

  • Gold rose 0.1 percent to $1,256.34 an ounce, the strongest in a month on a closing basis.
  • West Texas Intermediate crude rose 0.4 percent to $45.96 a barrel.

Bonds

  • The yield on 10-year Treasuries was little changed at 2.24 percent.
  • Germany’s 10-year yield fell one basis point to 0.49 percent on its seventh consecutive decline.
  • Britain’s 10-year yield rose less than one basis point to 1.183 percent.

Asia

  • The MSCI Asia Pacific Index edged higher after rallying over the past two weeks to the highest level in more than 10 years. Japan’s Topix index slid 0.5 percent, after dropping as much as 1 percent earlier in the day. Australia’s S&P/ASX 200 Index lost 0.6 percent.
  • The Shanghai Composite Index advanced 0.4 percent while Hong Kong’s Hang Seng was 0.5 percent higher. India’s Sensex climbed 0.6 percent to a record.
  • The Australian dollar rose 0.4 percent, trading above 79 U.S. cents ahead of a speech by Reserve Bank of Australia Governor Philip Lowe on Wednesday.

Is the CEO and Founder of Investors King Limited. He is a seasoned foreign exchange research analyst and a published author on Yahoo Finance, Business Insider, Nasdaq, Entrepreneur.com, Investorplace, and other prominent platforms. With over two decades of experience in global financial markets, Olukoya is well-recognized in the industry.

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Naira

Naira Weakens Against Dollar at Official, Parallel FX Markets

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New Naira notes

The Naira depreciated at the Nigerian Autonomous Foreign Exchange Market (NAFEM) and the parallel market on Monday, signifying more worries for the local currency.

At the official market – NAFEM – the local currency sold for the US Dollar at N1,603.16/$1 as it recorded a 0.15 percent or N2.38 drop versus N1,600.78/$1 it was valued at the previous session on Friday.

This occurred as supply rose at the opening session as turnover published on the FMDQ Group website stood at $359.22 million indicating that the session’s turnover went higher by 2.4 percent or $8.50 million compared to $350.72 million that was published the day before.

At the unofficial market, the domestic currency closed at N1,698.97 to the US Dollar, a drop of N8.15 compared to N1,690.82/$1 it closed during the Friday trading session.

The weakening of the Naira is happening as the nation’s external reserves continue to swell due to lower US Dollar volume sales to boost liquidity in the official FX market.

Latest data showed the balance in Nigeria’s foreign reserves inched to about $39 billion as CBN data revealed that Nigeria now has $38.992 billion as gross balance in the nation’s external reserves.

The CBN has not made do with its promise to prop up the market as it appears to have halted its weekly FX sales

In a different trend, the domestic currency witnessed a flat outcome against the British currency and the Euro in the week’s opening session.

On the Pound Sterling, the local currency closed at N2,153.90/£1 and N1,800.79/€1 on the Euro.

In the parallel market, the local currency depreciated in its value against the British Pound Sterling by N11.69 to sell at N2,213.25/£1 compared with the preceding session’s N2,201.56/£1 and followed the same pattern against the Euro as it lost N10 to quote at N1,845.29/€1 versus the previous day’s rate of N1,835.29/€1.

The local currency also depreciated further by N8.64 to close at N1,225.82 per Canadian Dollar, compared to Friday’s N1,217.18 per CAD.

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Naira

Naira Appreciates 3.6% on US Dollar, Trades N1,600

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Naira to Dollar Exchange- Investors King Rate - Investors King

The Naira rose 3.6 percent on the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEX) to exchange at N1,600.78/$1 on Friday, October 18 as the local currency appreciated amid an increased supply.

The domestic currency gained N59.71 on the American currency versus N1,660.49/$1, which it closed in the previous session on Thursday.

Data showed a rise in supply as the turnover published on the FMDQ Group website stood at $350.72 million indicating that the session’s turnover rose by 6.2 percent, indicating a rise of $20.54 million compared to $330.18 million that was published in the last trading session.

Meanwhile, the Naira witnessed a flat outcome against the Pound Sterling and the Euro as it closed on the British currency at N2,153.90/£1 and on the European currency at N1,791.06/€1 quoted in the preceding session.

In the Parallel market, the Naira weakened on the American currency as it closed at N1,690.82 to the US Dollar, a drop of N1.31 compared to N1,689.51/$1 it closed during the Wednesday trading session.

In the past months, the Naira has been volatile against the Dollar at the FX market despite interventions by the Central Bank of Nigeria.

The World Bank also said the Nigerian Naira is among the worst-performing currencies in sub-Sahara Africa at the end of August 2024.

In its latest edition of Africa’s Pulse report, the international organisation said the Naira is at par with the Ethiopian Birr, and South Sudanese Pound in terms of decline in the region.

However, the local currency appreciated in its value against the British Pound Sterling in the official market by N54 to sell at N2,201.93/£1 compared with the preceding session’s N2,147.93/£1 and followed the same pattern against the Euro as it gained N4.58 to quote at N1,835.29/€1 versus the previous day’s rate of N1,839.87/€1.

The local currency also depreciated N16.11 to close at N1,217.18 per Canadian Dollar, compared to Thursday’s N1,201.07 per CAD.

 

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Black Market Rate

Naira Gains on Dollar, Pounds, Others at Black Market, Falls at NAFEX

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New Naira notes

The Naira gained against the US Dollar in the Parallel segment of the foreign exchange market on Thursday, October 17 as it closed at N1,689.51 to the American currency, a gain of N4.41 compared to N1,693.32/$1 it closed during the Wednesday trading session.

The Naira also gained in its value against the British Pound Sterling in the market by N11.19 to sell at N2,147.93/£1 compared with the preceding session’s N2,159.12/£1 and followed the same pattern against the Euro as it appreciated N8.07 to quote at N1,839.87/€1 versus the previous day’s rate of N1,847.94/€1.

The local currency also appreciated N3.59 to close at N1,201.07 per Canadian Dollar, compared to the previous day’s closing value of N1,204.66 per CAD.

Meanwhile, the Naira depreciated marginally for yet another session against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) to N1,660.49/$1.

The local currency rose fell by 0.05 per cent or N91.01 at the window, according to data obtained from FMDQ Securities Exchange compared to N1,659.69/$1 published in the preceding session on Wednesday.

This occurred as supply rose at the penultimate session as turnover published on the FMDQ Group website stood at $330.18 million indicating that the session’s turnover jumped by 86.4 per cent, indicating that there was a decrease of $153.08 million compared to $177.10 million published the previous day.

The surge in supply could be due to peer-to-peer sales as the Central Bank of Nigeria (CBN) has no actively injected liquidity in the market.

Investors King reports that the CBN in August re-introduced the retail Dutch auction system with the aim to sell US Dollar to FX users on demand basis but after the market witnessed more than $1.1 billion injected into the system, there has been slowdown in the auction.

In a different pattern, the local currency closed flat against the Pound Sterling and depreciated on the Euro at the closing session.

Trading against the British currency, the local currency closed at N2,153.90/£1 while it closed at the rate of N1,791.06/€1, a N9.73 appreciation against N1,800.79/€1 against the Euro.

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