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Investors’ Fears Over Elections to Fade in February ―Analysts

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  • Investors’ Fears Over Elections to Fade in February ―Analysts

Analysts at Meristem Securities Limited have said the apprehensions that investors have about the forthcoming elections are expected to fade in February.

In a report, titled, ‘Resilience in vulnerability’, the analysts said they expected 2019 to be driven by similar factors that shaped 2018 but with a slight twist.

According to the report, although apprehensions about the election are expected to fade by February, contentions about the result, whichever it goes, have the potential to keep the market within a tight range bound trading in the first quarter of the year.

It said concerns about the United States slipping into recession in the medium term, expected slower pace of Fed rate hike, and progress towards resolutions of the challenges that crippled major emerging market economies in 2018 could trigger a bet on EMEs, and consequently the Nigerian market, but not until mid-year.

The analysts said corporate earnings were projected to be mixed and not strong enough to drive the market except in dividend seasons.

They said, “Offset to these upsides are country risks emanating from mounting debt profile, lower oil price outlook relative to 2018 and the impact on foreign exchange reserves at a time the defence of the currency is paramount.

“On the balance of factors, we are bearish on the first quarter, progressively positive from a neutral early second quarter to a bullish mid-year into the end of the year. Our models project a 2019 3.7 per cent, which is largely hinged on a low baseline.”

The analyst noted that the equities market opened 2018 with the euphoria of the 42 per cent gains in the Nigerian Stock Exchange All-Share Index in 2017 driving sentiments further higher.

They said the market accelerated at a pace that could not be supported by any fundamental driver as there were no revisions in consensus corporate earnings outlook, no optimism on macroeconomic variables and no respite in the political space.

The ASI, by the second week of 2018, hit the highest weekly gain since April 2015, and by the end of January, had reported the seventh highest monthly gains in 33 years.

The analysts said, “Within the first 14 trading days, no fewer than 39 stocks had gained equivalent of the yield on 364-day Treasury bills issued same day. However, a painful correction kicked with serial monthly losses from February through November, with the exception of June in which the ASI inched up by 0.46 per cent.

“Weak corporate earnings, contagion from EMEs and the attendant capital flight, apprehensions ahead of the 2019 general elections combined to send the ASI 17.81 per cent underwater in 2018. This, however, is half the story.”

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.

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FG Reopens Osubi Airport Warri for Daylight Operations

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FG Reopens Osubi Airport Warri for Daylight Operations

The Federal Government on Monday said the Osubi Airport in Warri has been reopened for daylight operations.

The Minister of Aviation, Hadi Siriki, disclosed this in a tweet.

The airport was closed in February 2020 over mismanagement and debt allegation involving aviation service providers and airport management.

However, Oberuakpefe Afe, a lawmaker representing Okpe/Sapeie/vaie federal constituency, recently moved a motion for the Federal Government through the ministry of aviation and relevant authorities to reopen the airport for flight operations.

On Monday, Hadi Siriki said “I have just approved the reopening of Osubi Airport Warri, for daylight operations in VFR conditions, subject to all procedures, practices and protocols, including COVID-19, strictly being observed. There will not be need for local approvals henceforth.

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Nigerian Brand, JR Farms Acquires 11% Stake in Rwandan Firm

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Nigerian Brand, JR Farms Acquires 11% Stake in Rwandan Firm

JR Firms, an agribusiness firm with headquarters in Nigeria, has announced partnership with Sanit Wing Rwanda through the acquisition of 11 per cent stake in the company.

The CEO of the company, Mr Rotimi Olawale, explained in a statement that the partnership was in furtherance of its goals to ensure food security, create decent jobs and raise the next generation of agrarian leaders in Africa.

The stake was acquired through Green Agribusiness Fund, an initiative of JR Farms designed to invest in youth-led agribusinesses across Africa.

Sanit Wing Rwanda is an agro-processing company that processes avocado oil and cosmetics that are natural, quality, affordable, reliable and viable.

The vision of the company is to become the leading producers of best quality avocado and avocado by-products in Africa by creating value across the avocado value chain.

With focus on bringing together over 20,000 professional Avocado farmers on board and planting of three million avocado trees by 2025 through contract farming, the company currently works with One Acre Fund in supply of avocado to its processing facility.

The products of the company which include avocado oil, skin care (SANTAVO), hair cream and soap are being sold locally and exported to regional market in Kenya.

With the new partnership with JR Farms- the products of the company will enjoy more access to markets focusing on Africa and the European Union by leveraging on partnerships and trade windows available.

Aside funding, the partnership comes with project support in areas of market exposure, capacity building, exposure and other thematic support to grow the business over the next four years.

JR Farms has agribusiness operations in Nigeria, Rwanda, United States and Zambia respectively.

In Nigeria, the company deals in cassava value chain processing cassava to national staple “garri” which is consumed by over 80 million Nigerians on daily basis, while in Rwanda, it works in the coffee value chain with over 4,000 coffee farmers spread across the East Central African country.

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Shut Down Depots Selling Petrol Above Approved Price – Marketers

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Shut Down Depots Selling Petrol Above Approved Price – Marketers

The Federal Government should close down depots that are selling petrol above the approved price, oil marketers said on Thursday.

National President, Independent Petroleum Marketers Association of Nigeria, Sanusi Fari, said the sale of petrol above government approved price by depot owners would soon lead to a hike in the commodity’s pump price.

Fari told journalists in Abuja that the government through its agencies such as the Department of State Services and the Department of Petroleum Resources should curb the development to avoid crisis in the downstream oil sector.

He said some private depot owners were selling at N165 per litre to independent marketers, way above the government stipulated price of N148 per litre.

Fari said, “Our challenge is the inconsistency in the pricing of petrol. Up till a week ago, government was still insisting that the February price for petrol remained unchanged.

“And most of the private depot owners are selling above the government stipulated price. As at today ( February 25, 2021) private depot owners are selling at N165 per litre to independent marketers.”

He added, “In the last six years, only NNPC imports refined products into this country and these tank farms buy their products from NNPC under a controlled price.

“This has affected our businesses seriously because government is insisting that we sell at the rate of N165, which is not going to work.”

The IPMAN president said filling station owners buy the product at N165 per litre from the private depots and incur other expenses such as transportation, rent, etc.

“So government cannot expect us to sell less than what we buy,” he said.

Fari added, “This is why we are calling on government and agencies that are saddled with the responsibility to control petrol pricing to urgently clamp down on depots that are selling above the stipulated price.”

The Nigerian National Petroleum Corporation, the country’s sole importer of patrol, recently stated that it never hiked the cost of petrol to depots.

It also enjoined the depot owners to sell the product at the approved rate and called on the DPR to enforce the stipulated price across the depots.

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