Finance Friday
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Market Data
Local
Global
*Data as of 4pm WAT
Market News
Local
Naira gains as CBN pays banks $6.7bn forex backlog - Punch
The Federal Government through the Central Bank of Nigeria, has commenced payment of outstanding matured FX forwards owed to various creditors
Stock Market Ends Positive Trend, Drops by N297bn - Thisday
The stock market yesterday, ended its four-day positive trend as the overall market capitalization depreciated by N297 billion over investors profit-taking in MTN Nigeria Communications (MTNN), BUA Cement, and 26 others.
Global
Global stocks jump and dollar slumps after weak U.S. jobs data - Reuters
The number of Americans filing new claims for unemployment benefits increased slightly, but the labor market continues to exhibit strength with limited signs of a significant slowdown. Continuing unemployment claims reached a six-month high, raising questions about a change in the underlying trend.
Treasury yields tumble after October payrolls report misses expectations - CNBC
U.S. Treasury yields retreated after employment data showed slower job growth than anticipated. The 2-year Treasury yield dropped over 10 basis points to 4.866%, while the 10-year Treasury yield fell 11 basis points to 4.558%. The benchmark Treasury yield had earlier climbed above 5%.
U.S. Added 150,000 Jobs in October; Unemployment Rate Was 3.9% - WSJ
United States saw a gain of 150,000 jobs, as reported by the Labor Department today. This figure fell short of economists' expectations, which were set at 170,000. The unemployment rate reached 3.9%, slightly higher than the anticipated 3.8%. Additionally, average hourly earnings increased by 0.2% for the month and 4.1% over the year.
Weekly Investment Watchlist
Market Commentary:
Asia and Australia:
Asian equities were higher across the region on Friday. Australia, in particular, closed higher for the fourth consecutive day. The Hang Seng led the region with gains in REITs and healthcare, and mainland bourses were also higher. There were strong gains for South Korea and Taiwan, and Singapore REIT stocks were also very strong. The rest of Southeast Asia recorded higher levels, and India opened with gains. However, Japan was closed for a holiday.
The Caixin services PMI for October was reported as 50.4, compared to the consensus of 51 and 50.2 in the prior month. While data indicated expansion for the tenth consecutive month, it only represented a marginal improvement from September’s year-to-date low. The growth in new orders was the weakest year-to-date, despite a faster improvement in new export business, partly due to the easing of travel restrictions.
China Evergrande proposed that offshore creditors receive a 30% equity stake in each of its two Hong Kong-listed subsidiaries.
Taiwan central bank minutes revealed concerns about higher inflation in the future.
Europe, Middle East, Africa:
European equity markets were higher but slightly off their best levels. They were on track for a positive close after three consecutive weeks of weaker levels.
The Euro Area seasonally-adjusted unemployment rate increased to 6.5% in September 2023, up from 6.4% in August. This differed from market expectations of 6.4%.
Exports from Germany fell by -2.4% month-on-month, in contrast to the consensus of -1.1%. The previous month had seen a marginal increase in exports by 0.1%.
Danish shipping giant Maersk planned to lay off 10,000 workers due to lower freight rates. While this may seem like a small portion of its workforce, Maersk has 110,000 employees, signifying the gradual impact of the freight recession on the global economy. This development isn’t primarily about cost reduction but rather reflects a global economic slowdown.
The Americas:
Apple’s fiscal Q4 revenues were largely in line, and EPS exceeded estimates by around 5% due to record high gross margin of 45.2%, supported by lower commodity costs, a favorable mix, and a reacceleration of services. Notably, Apple’s China revenue fell by 2.5% year-on-year, worse than analyst estimates and indicative of a company-wide sales decline. The company’s guidance for December Q revenue was similar to the year-earlier period, leaving it nearly 5% below what the Street had anticipated. Key takeaways included persistent China concerns, the potential for another year of no growth, and worries about weakness across iPads, Macs, and Wearables as leading indicators of further softening in other segments.
Bank of America (BoFA) Weekly Flows indicated $64.2 billion inflow to cash, $4.5 billion inflow to bonds, $81 million outflow from gold, and $3.4 billion outflow from stocks.
The Week Ahead:
Monday:
Tuesday:
US Employment Cost Index q/q rose 1.1% quarter-over-quarter (q/q, 4.4% annualized)
US CB Consumer Confidence decreased from 103 in September to 102.6 in October
Wednesday:
US ADP Employment Change is at a current level of 113000.0, up from 89000.00 last month
US ISM Manufacturing PMI dropped to 46.7 in October from 49.0 in September
US initial jobless claims up by 5,000 to 217,000
US Federal Funds Rate remains steady at 5.25% to 5.5%
Thursday:
U.S. weekly jobless claims total 198,000, fewer than expected
Friday:
US Average Hourly Earnings is at a current level of 33.88, up from 33.81 last month
US nonfarm payrolls up 150,000 in October
US Unemployment Rate rose to an almost two-year high of 3.9%
US ISM Services PMI is at a current level of 53.60, down from 54.50 last month
Investment Tip of The Day
Evaluate Commodity Price Risk: For investments linked to commodities, watch for price volatility. Hedging strategies or diversification can reduce the risk of commodity price fluctuations.
Meme of the Day
