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Stocks Steady Ahead of Fed, Bond Yields hit Key Levels, Oil Dips, Gold Rebounds, Bitcoin Struggles

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By Edward Moya

US stocks are steadying ahead of a pivotal Fed decision that will deliver the largest rate hike since the start of the millennium. Wall Street knows the next few months could be rather challenging given the current forces of inflation and all the uncertainty with energy prices and supply chain issues.  Despite all the risks to economic growth, investors are still mostly optimistic that stocks will finish much higher by the end of the year.  Market volatility is expected to remain elevated over the next few Fed meetings and that could mean stocks could soften by another 5% before traders aggressively buy the dip.

The Fed is widely expected to raise rates by a half-point and announce the balance-sheet runoff tomorrow. The Fed knows the first few rate hikes won’t restrain growth that much but their messaging on tightening going forward and the size of the balance sheet runoff start could rattle markets. The S&P 500 index has major support at the 4,050 level heading into the Fed meeting.

Fixed income traders have watched many massive technical levels reached, with the 10-year Treasury yield testing 3.00%, the German bund yield tentatively tested 1.00%, and as Gilts tested 2.00%.  Aggressive central bank tightening has been keeping the bond market selloff going, but prices should now consolidate until the Fed meeting.

Oil

Crude prices are declining as Beijing tightens up their Covid controls and as tanker-tracker data showed Russian crude flows increased.  Energy traders are not convinced that the EU will be able to move forward with an embargo on Russian oil. ​

Oil seems to have major support around the $100 level as OPEC+ seems poised to rubber stamp next month’s output increase target that they probably won’t hit.  Still weighing on oil is the uncertainty with China’s Covid situation.  Energy traders are also keeping a close eye on the Fed policy meeting which could contain a hawkish surprise that sends the dollar higher, which will drag down commodity prices.

Gold

Gold’s two weeks of pain appears to be over as Wall Street has priced in the majority of global central bank tightening.  After a major run higher for US and European bond yields, non-interest bearing gold is mustering up a rally as fixed income traders appear to be getting closer to pricing in peak hawkishness.

Gold has been battered as investors brace for the most hawkish Fed policy decision since the start of the millennium.  The dollar rally could be getting closer to nearing its end and that should be good news for bullion.  Gold’s fate could very well be determined on how aggressive the Fed will be with balance sheet normalization.

Bitcoin

Bitcoin is in wait-and-see mode for the Fed policy decision, which could show Wall Street has priced in peak Fed hawkishness.  Bitcoin is struggling to muster up a rally as investors remain cautious about buying risky assets. Bitcoin needs a fresh catalyst as sentiment on Wall Street remains fairly downbeat. ​

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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Energy

How Nigeria’s National Power Grid Collapsed Ten Times Within 9 Months 

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The national power grid has again collapsed, leaving many Nigerians in total darkness.

Investors King can authoritatively report that this is the tenth time the power grid will be disrupted this year alone.

For this recent collapse, the grid, reportedly lost power generation around 1:39 pm on Tuesday.

Information revealed that power generation was 2,711 megawatts as of 1:00 pm, having previously peaked at 3,631 MW.

Earlier, power generation peaked at 3,934.77 MW around six o’clock in the morning.

However, between 2 pm and 3 pm, hourly generation dropped to 0.00 MW.

The Transmission Company of Nigeria confirmed that the national grid experienced a partial disturbance at about 1:52 pm on Tuesday, 5th November 2024.

TCN spokesperson Ndidi Mbah mentioned that the recent collapse was due to a series of line and generator trippings that caused instability in the grid and, consequently, the partial disturbance of the system.

Mbah pointed out that data from the National Control Centre revealed that a part of the grid was not affected by the bulk power disruption.

TCN however indicated that work work is in progress to restore power.

She explained that engineers are already working to quickly restore bulk power supply to the states affected by the “partial disturbance.”

Mbah noted that presently, bulk power supply has been restored to Abuja at 2:49 pm, maintaining that “we are gradually restoring it to other parts of the country.”

She apologized to Nigerians for whatever inconvenience the collapse might have caused.

Findings by Investors King revealed that the grid had collapsed at ten different times between March and November, this year.

Times the grid collapsed included February 4, March 28, April 15, July 16, two times in August 5, October 14, October 15, twice in October 19 and now today, November 5.

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Energy

Darkness Falls Again: TCN Explains Latest National Grid Collapse

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The Transmission Company of Nigeria (TCN) has provided an explanation for the latest National Grid collapse, which occurred on Tuesday, November 5.

Tuesday’s collapse, marking the 10th in 2024 alone, left Nigerians in total darkness.

Recall that the National Grid collapsed twice in October, sparking concerns among Nigerians.

Reacting to the latest collapse via a statement on Tuesday, the General Manager of TCN Public Affairs, Ndidi Mbah, disclosed that the collapse happened at 1:52 pm.

The GM revealed that the grid collapse was caused by line and generator trippings.

Mrs. Mbah said, “TCN states that the national grid experienced a partial disturbance at about 1:52 pm today, 5th November 2024.

“This followed a series of line and generator trippings that caused instability in the grid and, consequently, the partial disturbance of the system.

Data from the National Control Centre (NCC) revealed that a part of the grid was not affected by the bulk power disruption.

Mbah disclosed that operators are working to restore power in affected states, adding that power was restored in Abuja.

She explained, “TCN engineers are already working to quickly restore bulk power supply to the states affected by the partial disturbance. Presently, bulk power supply has been restored to Abuja at 2:49 pm, and we are gradually restoring power to other parts of the country.”

Apologizing to Nigerians, TCN said, “We sincerely apologize for any inconvenience this may cause our electricity customers.”

Investors King, in an earlier report, revealed that in an attempt to address the persistent collapse of the national grid, the Nigerian Electricity Regulatory Commission (NERC) announced that discussions were underway with Independent Operators to take over the management of the grid.

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Energy

Nigeria Partners with ECOWAS and Morocco to Launch $26B African Gas Pipeline

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The Nigerian government, in partnership with the Economic Community of West African States (ECOWAS), Morocco, and Mauritania, has announced plans to advance the $26 billion African Atlantic Gas Pipeline project to drive economic growth across Africa.

This development was revealed on Monday, November 5, by Mele Kyari, Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), at the ECOWAS Inter-Ministerial Meeting on the Nigeria-Morocco Gas Pipeline Project.

Speaking at the meeting, which was attended by ECOWAS Ministers of Hydrocarbons and Energy as well as representatives from Morocco and Mauritania, Kyari stated that, once completed, the project will connect 13 African countries.

Represented by Olalekan Ogunleye, NNPC’s Executive Vice President for Gas Power & New Energy, Kyari said this will be Africa’s largest pipeline project.

Ogunleye confirmed that progress has been made with the front-end engineering design completed, the phase two study finalized, and work ongoing for environmental and social impact assessments as well as land acquisition and resettlement.

He emphasized NNPC’s readiness to execute the project: “Today, we come together to make significant progress in the African Atlantic gas pipeline project, which is a transformative initiative connecting at least 13 African nations in shared prosperity and development. These achievements underscore our capability to deliver this landmark project, supported by strong regional collaboration.”

Ekperikpe Ekpo, Minister of State for Petroleum Resources (Gas), described the project as a game-changer for the regional economy, stating, “We stand at a critical juncture where these agreements can reshape our energy landscape, strengthen our economies, and uplift our people.”

He also highlighted that the project will increase Africa’s presence in the global gas market, noting that “the agreements demonstrate a strong commitment to advancing hydrocarbon and energy trade across ECOWAS, enhancing access to natural gas in West Africa, and expanding Africa’s global footprint in the gas market.”

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