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Guinness, Cadbury, Stanbic Bolster Stock Market Last Week

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  • Guinness, Cadbury, Stanbic Bolster Stock Market Last Week

The Nigerian Stock Exchange (NSE) sustains bullish run last week as stocks of Guinness Nigeria, Cadbury Nigeria, Stanbic IBTC, etc bolstered market value.

The market capitalisation of listed equities appreciated by 0.25 percent or N32 billion to close the week at N13.168 trillion, up from N13.136 trillion recorded in the previous week.

While the NSE All-Share Index gained 63.07 basis points from 25,204.75 basis points achieved in the previous week to close at 25,267.82 basis points last week.

Despite economic headwinds the bourse has continued to expand, gaining 9.76 percent in the month of June and 18.63 percent in the second quarter of the year. The year-to-date return moderated from over -12 percent in the first quarter to -5.86 percent in the second quarter.

Activity level was low when compared to the previous week, this is largely due to the Eid al-Fitr holidays declared by the Federal Government on Monday 25th and Tuesday 26th of May.

Total shares of 1.255 billion valued at N13.501 billion were exchanged in 20,554 deals last week, down from the 1.718 billion shares worth N18.849 billion traded in 26,367 deals in the previous week.

In terms of the volume traded, the financial services sector led with 953.356 million shares valued at N8.236 billion transacted in 10,931 deals. The sector contributed 75.94 percent and 61 percent to the total shares and value traded during the week.

This was followed by the industrial goods sector with 64.245 million shares worth N1.785 billion in 2,000 deals.

The consumer goods sector added 62.487 million shares valued at N1.434 billion but exchanged in 3,427 deals.

The FBN Holdings Plc, Zenith Bank Plc and Guaranty Trust Bank Plc were the three most traded shares by volume, accounting for 494.748 million shares worth N6.618 billion in 5,566 deals.

The three contributed 39.41 percent and 49.02 percent to the total equity turnover volume and value, respectively.

Top Gainers

NEIMETH INTERNATIONAL PHARMACEUTICALS
SKYWAY AVIATION HANDLING COMPANY PLC
AXAMANSARD INSURANCE PLC
CUTIX PLC.
GLAXO SMITHKLINE CONSUMER NIG. PLC.
GUINNESS NIG PLC
JAIZ BANK PLC
MAY & BAKER NIGERIA PLC.
CADBURY NIGERIA PLC.
STANBIC IBTC HOLDINGS PLC

Top Losers

REGENCY ASSURANCE PLC
ARDOVA PLC
LEARN AFRICA PLC
ECOBANK TRANSNATIONAL INCORPORATED
TRANSNATIONAL CORPORATION OF NIGERIA PLC
VITAFOAM NIG PLC.
DANGOTE CEMENT PLC
AFROMEDIA PLC
AFRICA PRUDENTIAL PLC
WAPIC INSURANCE PLC

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.

Finance

States Debt Rises by 163 Percent -BudgIT

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Debts of All 36 States Rise by 163 Percent or N3.34 Trillion to N5.39 trillion Between 2014 and 2019

Debts continue to rise across the 36 states of the Federation, according to a recent report by BudgIT, a public sector-focused financial information house.

In the just released 2020 edition of its annual state of states report titled, “Fiscal Sustainability and Epidemic Preparedness Financing at the State Level”, BudgIT said debts rose by 162.87 percent or N3.34 trillion from N2.05 trillion in 2014 to N5.39 trillion in 2019 across the 36 states.

The report stated that 10 of the states incurred half or N1.68 trillion of the entire debt, adding that seven of the 10 states are from the South while three are from the North.

Speaking on how states can attain fiscal sustainability, Damilola Ogundipe, BudgIT’s Communications Lead, said: “States need to grow their Internally Generated Revenue, IGR, as options for borrowing are reduced due to debt ceilings put in place by the Federal Government to prevent states from slipping into debt crisis. There has to be a shift from the culture of states’ overdependence on Federation Account Allocation Commission, FAAC.

The report further stated that 13 states, including Lagos, Oyo, Kogi and others, were unable to fund their recurrent expenditure together with debt repayments due in 2019.

It stated: “From our 2020 State of States analysis, 13 states were unable to fund their recurrent expenditure obligations together with their loan repayment schedules due in 2019 with their respective total revenues. 

“The worst hit of these 13 states are – Lagos, Oyo, Kogi, Osun and Ekiti states while the other states on this pendulum are Plateau, Adamawa, Bauchi, Gombe, Cross River, Benue, Taraba and Abia. 

“Furthermore, of the remaining 23 states that can meet recurrent expenditure and loan repayment schedules with their total revenue, eight of those states had really low (less than N6 billion) excess revenue, that they had to borrow heavily to fund their capital projects. 

“The worst hit are Zamfara, Ondo and Kwara who had N782.45 million, N788.22 million and N1.48 billion left, respectively. 

“Based on their fiscal analysis, only five states – Rivers, Kaduna, Akwa Ibom, Ebonyi and Kebbi states – prioritised capital expenditure over recurrent obligations, while 31 states prioritised recurrent expenditure according to their 2019 financial statements.”

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Oil Marketers Says No to Labour Strike, Decries Over N320bn Losses

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Oil Marketers Reject Labour Strike, Decries Over N320bn Losses

Oil marketers across the country have rejected labour’s planned strike over N320 billion worth of investment losses.

The marketers under the aegis of the Natural Oil and Gas Suppliers Association of Nigeria also kicked against the proposed industrial action by the Nigeria Labour Congress and other civil right groups, pleading with the union and allies to have a rethink and look into the situation from a bigger picture.

This was after labour and other civil right groups announced they would be embarking on a nationwide strike starting from September 28, 2020 to force the government to reverse the increase in pump price and electricity tariffs.

Labour had said the government remained insensitive to the plight of Nigerians despite the negative impacts of COVID-19 on the economy and Nigerians.

However, Ukadike Chinedu, the association spokesperson of Natural Oil and Gas Suppliers Association of Nigeria, who was quoted in a statement issued in Abuja, said members of the association may be forced to cut staff in an effort to reduce operating costs given current economic realities.

He said, “Some of our concerns are heavy losses of over N320bn investments from product purchases at government specified prices and sales at compelled price reductions, which could not be justified by the costs of transaction.”

Ukadike added that several oil businesses were no longer trading because of heavy losses and several others were dying in silence.

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Banks’ Credit to Economy Hits N19.33 Trillion in August

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Godwin Emefile

Deposit Money Banks Credit to Economy Rose to N19.33 Trillion in August

The total credit facility to the economy rose to N19.33 trillion in the month of August.

The Central Bank of Nigeria-led monetary committee disclosed on Tuesday after the nation’s monetary policy committee meeting.

The committee attributed the improvement to the 65 percent loan-to-deposit ratio policy implemented to compel the nation’s deposit money banks to join central bank efforts at growing the real sector of the economy.

Godwin Emefiele, the Governor of the Central Bank of Nigeria, who spoke during the meeting said “The bank’s policy on Loan to Deposit ratio also resulted in a significant growth in credit to various sectors from N15.57tn to N19.33tn between end-May 2019 and end-August 2020, an increase of N3.77tn.

“This growth in credit was mainly to manufacturing (N866.27bn), consumer credit (N527.65bn), oil and gas (N477.65bn), agriculture (N287.11bn) and construction (N270.97bn).”

On monetary aggregates, broad money supply (M3) rose to 6.93 per cent (year-to-date) in August 2020 from 5.23 per cent in July 2020, reflecting the increase in both Net Foreign Assets and Net Domestic Assets.

He said total domestic credit grew by 6.94 percent in August 2020, lower than the 9.43 percent recorded in July 2020.

The committee reduced the nation’s benchmark interest rate by 100 basis points to 11.5 percent, down from the previous 12.5 percent.

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