What To Expect From The Markets This Week - 210518

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Saturday, May 19, 2018 08:00 AM / Proshare Content
 

Nigeria: Economic Dashboard @ 190518

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From the Editor’s Desk

On Tuesday, May 16, 2018, Nigeria’s budget was passed by the upper chamber. Apart from a 6% increase in the initial quantitative value from N8.6 trillion to N9.12 trillion, coupled with a change in the oil benchmark from $45 to $51 per barrel, there were no significant material changes to the budget. 

As earlier mentioned, inflation for April 208 sustained the nose dive trajectory as headline inflation declined from 13.34% to 12.48%, thereby dipping by 0.86. The decline is on the heel of a slump in food inflation from 16.08% to 14. 8% in April 2018. However, core inflation fell tepidly by 0.3% to 10.9% at the end of April 2018  contrast to food inflation.

 

Fig 1: Inflation among African Countries

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Source: Trading Economics

 

Month on month inflation remained stuck at 0.8% at the end of April, thereby month on month inflation for four months in a row have remained stationary.  Holistically, three out of the four black ducklings across the region, showed that these countries had their aggregate price jolted by negative price shocks in 2016. They include Nigeria, Egypt and Angola with the exception of South Sudan which has so far experienced faster deceleration in price movement compared to most countries in the region. 

The recent decline is a product of stable exchange rate, fizzling off supply shocks; more favourable weather conditions compared to the previous year coupled with a base effect. 
 

Fig 2:  Portfolio Investment

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Source: Nigerian Bureau of statistics (NBS)

 

The total foreign portfolio investment at the end of the first quarter of 2018, stood at $4.56 billion, thus making up 76.5% of total capital importation for the first quarter of 2018.  Moreover, $3.52 billion in foreign portfolio investment was ploughed towards the money market, thereby reflective of a 62% increase compare to the previous quarter: Eventually, comprising of 55.9% and 77.2% of capital importation and portfolio investment for the first quarter of 2018 respectively.  
 

News Post:  Headline Inflation Drops to 12.48% in April 2018

 

Read the Full Report HERE 

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Other Developments

 

In the week ahead, the Monetary Policy Committee (MPC) will hold its statutory meeting. The bank on several occasions has made clear that 12% inflation will serve both as guidance and a pre-condition for a haircut to monetary policy rate (MPR). Recently, the spike in the American 10 year treasury bond to 3.06% rattled emerging markets, putting pressure on their currency.  

Nigeria was not immune, as total trade in I&X window plummeted by 67% forcing the Naira to shed 22 kobo in weight, partly contributing to the foreign exchange reserve to faint slightly. The incentive to retain rate might have firmed up for the apex bank in order to avoid a claw back in money market instrument held by foreign portfolio investors.  

In most scenarios whereby the centrepiece of monetary policy is to grease the current account with “hot money’’; the trade-off  puts the nation’s financial deepening ratio in a narrow position, eventually weighing heavily on both growth and employment.  Moreover there is the danger of being caught up in an interest rate trap, just like Argentina.    


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Monday, May 21, 2018

The Central Bank’s  Monetary Policy Committee (MPC) meeting will commence this day, just as the National Economic Summit Group (NESG) hosts the Public Presentation of the IMF Regional Economic Outlook (REO) Spring 2018 Issue in Lagos on the same date. 

The National Bureau of Statistics (NBS) will this day release the Nigerian Gross Domestic Product (GDP) by Output Q1 2018 Report, while the Direct Investors Summit Nigeria 2018 powered by the Nigerian Investment Promotion Commission (NIPC) and the 7th Sustainability in the Extractive Industries Conference kicks off in Abuja.                                       

Fidelity Bank Plc
in conjunction with the Lagos Business School will commence an Export Management Programme this day, while Resonae Solutions in conjunction with Africa Communications Week 2018 will host an Online Workshop on “Economic Integration in Africa”.
 

AIICO Insurance Plc and Omoluabi Mortgage Bank Plc will be marked down by the NSE; having declared a dividend of N0.05 and N0.01 respectively in the preceding week.       
 

What did we miss?

 
Tuesday, May 22, 2018

The Indo-Africa ICT Expo and the 2nd Chinua Achebe International Conference will kick off this day in Lagos and Nsukka, respectively. The CIPM Nigeria training on “Nigeria Labour & Employment Laws” will commence this day. 

Consolidated Hallmark Plc and Nestle Nigeria Plc will hold their Annual General Meeting (AGM) this day.
                     

Wednesday, May 23, 2018

The Workforce Group L&D Leaders Conference will kick off this day in Lagos, while the SHRM Quarterly HR Strategy Roundtable holds on the same date.
 

Thursday, May 24, 2018           

The Nigeria-South Africa Chamber of Commerce (NSACC) will this day hold its May 2018 Breakfast Meeting, while the FITC Thought Leadership Discussion Series holds in Lagos. 

The Annual General Meeting (AGM) of Glaxosmith Plc, Regency Alliance Plc, AIICO Insurance Plc and Infinity Trust Mortgage Bank Plc will hold this day, while Eterna Plc will be marked down by the NSE; having declared a dividend of N0.40 in the preceding week.    

The ECOWAS Youth Council Education & Entrepreneurship Summit will hold this day in Lagos, while the Lagos Business School Sustainability Centre will this day host its Annual Sustainable Development Symposium themed “From Global Goals to Local Action: Catalyzing Action Towards Sustainable Water Development.”
 

Friday, May 25, 2018           

The National Bureau of Statistics (NBS) will this day release the Federal Account Allocation Committee April 2018 Disbursement Report, while Fidelity Bank Plc holds its Annual General Meeting (AGM) in Lagos. 

The Annual Behavioural Change Practitioners Conference 2018 and the 3rd West Africa International SME Conference & Excellence Awards will hold this day.
 

Saturday, May 26, 2018

The WE CODE Software Developers MeetUp will hold this day in Abuja.             

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Check out our Events Calendar for event details and follow us on Web, TV, APP and Social Media for updates as the week unfolds. Yours to Serve!

 
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Contact for Details:

For further information, enquiry or submission of information, kindly email market@proshareng.com and research@proshareng.com Tel: 0700PROSHARE (070077674273). We are waiting to hear from you!

 
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Latest Reports This Past Week

1.       Consumer Price Index (CPI) April 2018 Report - NBS

2.       Executive Summary of Changes to CAMA – Nigerian Senate 

 

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Previous Week(s) Market Outlook  

1.      What To Expect From The Markets This Week - 140518

2.     What To Expect From The Markets This Week - 070518

3.     What To Expect From The Markets This Week - 300418

4.     What To Expect From The Markets This Week- 230418

 

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Related News

1.       Nigerian Senate Passes N9.12trn 2018 Budget

2.      Headline Inflation Drops to 12.48% in April 2018

3.      Emerging Market Monetary Policy Settings on Loose Side As Fed Tightens

4.      Personal Statements by the MPC Members at the 117 MPC Meeting of Apr 03-04, 2018

5.      Stock Market Maintains Downtrend as NSEASI Dips by -0.44%; Records -1.34% Loss WoW

6.      Stock Market Resumes Downtrend as NSEASI Dips by -0.77%

7.      Equities Market Halts Downtrend as NSEASI Inches Up by 0.93%

8.     Nigerian Stock Market Maintains Downtrend as NSEASI Dips Further Amid Negative Breadth

9.      NSEASI Dips by -0.84% to Erase Previous Day Gain; Opens The Week Negative

 

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