Money Monday
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Market Data
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*Data as of 4pm WAT
Market News
Local
MoMo PSB’s active wallets hit 3.6 million in Q3, 2023 - Naira Metrics
In Q3 2023, active wallets for Mobile Money Operators (MOMO) and Payment Service Banks (PSBs) in Nigeria reached 3.6 million, reflecting significant growth in digital financial services, as more individuals and businesses adopt these platforms for transactions. This expansion highlights the increasing role of digital finance in Nigeria's financial landscape.
MTN Nigeria’s pre-tax profit declines by 75.7% year-on-year in Q3, 2023 - Naira Metrics
MTN Nigeria's pre-tax profit has declined by 75.7% year-on-year in the third quarter of 2023. This significant drop is attributed to higher operating costs and a decrease in revenue. Despite these challenges, the company continues to invest in its network infrastructure and expansion.
Global
Oil falls over 2% as concerns about Mideast supply ease - Reuters
Oil prices fell over 2% on Monday due to easing concerns about the Israel-Hamas war affecting supply from the region and investors adopting caution ahead of this week's U.S. Federal Reserve meeting and other indications of global economic health. Brent crude futures fell 2.38% to $88.33 a barrel, while U.S. West Texas Intermediate crude was down 2.72% at $83.21.
Weekly Investment Watchlist
Market Commentary:
Asia and Australia:
Asian equities concluded with a mixed performance on Monday. Mainland China equities continued their week-long outperformance. Hang Seng, however, was held back by energy stocks but still managed to close flat and well above its earlier trough. There were small gains in Seoul and Taipei, while most of Southeast Asia and India received support. Japan and Australia followed the lead of the overnight Wall Street indexes and ended lower.
Over the weekend, 20 listed Chinese companies announced share buyback plans, and the major mutual fund house, E Fund Management, expressed its intention to spend more than CNY200 million on one of its own products. These moves are part of Beijing’s ongoing efforts to bolster the sliding stock market, following the Central Huijin state fund’s announcement the previous Monday that it would purchase CNY17 billion worth of domestic ETFs.
In Australia, retail sales increased by 0.9% month-on-month in September, surpassing the consensus of 0.3% and following 0.2% growth in the previous month. This positive performance is a promising sign for the economy but may not be viewed as favorable for inflation, which continues to trend higher than expected.
For Asia, all eyes are on the Bank of Japan meeting, with a decision expected to be released around 11 pm ET. This meeting is accompanied by their Quarterly Outlook Report. There has been significant speculation regarding the expansion of the Yield Curve Control (YCC) and changes in inflation estimates. The central bank is tasked with balancing concerns related to yields, equities, and the currency. However, it is unlikely that they will announce the end of easing.
Europe, Middle East, Africa:
European equity markets exhibited gains, also following a mild uptick in Asian markets. This set the stage for a relief rally following last week’s downturn.
Regarding the German GDP, there was a noticeable decline in private consumer spending. However, positive impulses from investment in equipment were observed. Confidence indicators remain at very low levels, despite showing signs of bottoming out. There is a prevailing belief that Germany will enter a recession during the winter. With one-quarter of negative GDP on record and an expected negative result for Q4, the likelihood of a recession is on the rise.
The Euro Area October Economic Sentiment gauge, as published by the European Commission, marginally dropped to 93.3 in October, down from a revised 93.4 the previous month. Economists had predicted a slightly steeper drop to 93.0. This marks the sixth consecutive month of decline in economic sentiment.
In Germany’s bellwether state, North Rhine-Westphalia, there was a negative monthly inflation print, marking the first occurrence since May 2023. Additionally, this was the lowest annual pace since June 2021. In the same vein, Spain’s preliminary CPI came in lower than expected, at 0.3% month-on-month, compared to the anticipated 0.7%, and 3.5% year-on-year versus the expected 3.8%.
In terms of Eurozone earnings for Q3, results have been mixed. While some companies have surprised positively by 1%, others have disappointed by 1% (excluding financials). Despite these results, analysts are still lowering estimates due to industrial guidance and new order activity from Eurozone Purchasing Managers’ Indexes (PMIs), which suggest a sequential deceleration in demand. Although European banks have mostly exceeded estimates, they face challenges related to peaking interest rates, weakening loan demand, rising deposit betas, and delinquencies. As a result, the outperformance of European banks is expected to slow down, particularly as cyclical sectors like autos continue to face pressure, leading to their underperformance compared to defensives in the run-up to the year-end.
The Americas:
The United Auto Workers (UAW) expanded its strike against General Motors on Saturday to include its Spring Hill, Tennessee, engine plant. This move could potentially stall GM’s large pickup production and increase its financial challenges. With this expansion, GM is now the only Detroit automaker without a contract deal, as Chrysler owner Stellantis reached an agreement with the UAW on Saturday, and Ford did so on Wednesday.
Sofi Technologies reported a Q3 (September) loss of $0.03 per share, which was $0.05 better than the FactSet Consensus of ($0.08). Additionally, revenues increased by 34.6% year-on-year, reaching $564.2 million compared to the FactSet Consensus of $511.3 million. The company also issued raised guidance for FY23, with expected revenues ranging from $2.045 billion to $2.065 billion, up from the earlier guidance of $1.974 billion to $2.034 billion, compared to the FactSet Consensus of $2.03 billion.
McDonald’s delivered a double beat. In Q3 (September), the company reported earnings of $3.17 per share, which was $0.17 better than the FactSet Consensus of $3.00. Additionally, revenues grew by 14.0% year-on-year to $6.69 billion, surpassing the FactSet Consensus of $6.56 billion. Global comparable sales increased by 8.8%, reflecting strong comparable sales across all segments. This includes an 8.1% increase in the U.S., an 8.3% growth in the International Operated Markets segment, and a 10.5% increase in the International Developmental Licensed Markets segment.
The Week Ahead:
Monday:
Tuesday:
Employment Cost Index q/q (US)
CB Consumer Confidence (US)
Wednesday:
ADP Non-Farm Employment Change (US)
ISM Manufacturing PMI (US)
JOLTS Job Openings (US)
Federal Funds Rate (US)
Thursday:
BOE Monetary Policy Report
Unemployment Claims (US)
Friday:
Average Hourly Earnings m/m (US)
Non-Farm Employment Change (US)
Unemployment Rate (US)
ISM Services PMI (US)
Investment Tip of The Day
Stay Aligned With Financial Objectives: Continuously assess your investment choices to ensure they align with your evolving financial goals and life circumstances. Adjust your portfolio as needed to stay on track.
Meme of the Day
