Business
Asian Stocks Retreat as Samsung Electronics, WorleyParsons Drop
TOKYO – Asian stocks fell for a second day after valuations on the regional benchmark index reached the highest level since May and as Samsung Electronics Co. and WorleyParsons Ltd. (WOR) declined.
Samsung lost 1.3 percent as investors awaited a U.S. court decision on how much the South Korean handset maker should pay Apple Inc. for patent infringement. WorleyParsons, Australia’s largest oil and gas engineering company, slumped a record 26 percent after saying profit will miss a forecast given last month. Micronics Japan Co. surged 21 percent in Tokyo after the electronics-component maker said full-year earnings would increase from the prior period.
The MSCI Asia Pacific Index fell 0.5 percent to 142.14 as of 4:17 p.m. in Hong Kong, with five stocks declining for each three rose. The gauge added 0.9 percent this week through yesterday. The Federal Open Market Committee publishes minutes of its October meeting today after Federal Reserve Chairman Ben S. Bernanke said the U.S. benchmark interest rate will remain near zero for a “considerable time” when central bank’s debt purchases end.
“There is evidence of profit taking,” Ric Spooner, Sydney-based chief market analyst at stockbroker CMC Markets, said in an e-mail. “Upcoming data beginning with tonight’s release of U.S. retail sales has more capacity to shift thinking on the timing and pace of the Fed’s taper program.”
Markets advanced this week after China pledged to execute economic reforms and Bernanke’s nominated successor, Fed Vice-Chairman Janet Yellen, said she would continue U.S. stimulus. Retail sales in the U.S. probably returned to growth last month, according to a Bloomberg survey of economists before data due today.
Relative Value
The Asia-Pacific gauge traded at 13.9 times estimated earnings yesterday, having touched 14 on Nov. 18, the highest since May. That compared with 16.2 for the S&P 500 yesterday and 15.1 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
The Organization for Economic Cooperation and Development cut its global growth forecasts yesterday, citing a slowdown in developing nations. The world economy will probably expand 2.7 percent this year and 3.6 percent in 2014, instead of the 3.1 percent and and 4 percent predicted in May, the Paris-based OECD said in a semi-annual report yesterday.
Bernanke’s statement that a “preponderance of data” would be needed to start removing stimulus comes after Yellen said last week that the U.S. economy is not yet strong enough to warrant cuts to the record bond-buying program.
Regional Gauges
Japan’s Topix index dropped 0.3 percent after the nation posted its biggest trade deficit on record. South Korea’s Kospi index and Taiwan’s Taiex both fell 0.7 percent. Australia’s S&P/ASX 200 Index sank 0.9 percent and New Zealand’s NZX 50 Index fell 0.5 percent. Singapore’s Straits Times Index slipped 0.3 percent.
Hong Kong’s Hang Seng China Enterprises Index (HSCEI) of mainland Chinese shares listed in the city gained 0.6 percent, capping a five-day rally and closing at the highest level since March after China’s central bank elaborated on plans to free up foreign-exchange controls.
The People’s Bank of China will “basically” end normal intervention in the currency market and broaden the yuan’s daily trading limit, Governor Zhou Xiaochuan said, without giving a time frame. The daily range will be widened in an “orderly way” as China seeks to enhance the currency’s two-way flexibility, Zhou wrote in an article in a guidebook explaining reforms outlined last week following a Communist Party meeting.
Hong Kong’s China Enterprises Index index climbed 28 percent from this year’s low on June 25 through yesterday as data signaled China’s economy is strengthening and policy makers unveiled the biggest package of reforms since the 1990s. Hong Kong’s Hang Seng Index (HSI) added 0.2 percent today and the Shanghai Composite Index advanced 0.6 percent.
China Reforms
China’s policy makers have pledged to allow more private investment in state-run industries, ease the one-child policy and expand farmers’ land rights.
Futures on the Standard & Poor’s 500 Index were little changed today. The gauge dropped 0.2 percent yesterday, a second day of declines, as investors weighed rising valuations and disappointing earnings forecasts.
“The target for the federal funds rate is likely to remain near zero for a considerable time after the asset purchases end, perhaps well after” the jobless rate falls below the Fed’s 6.5 percent threshold, Bernanke said in a speech to economists in Washington. A “preponderance of data” would be needed to begin removing accommodation, he said.
– BLOOMBERG
The Office of the Auditor-General of the Federation has uncovered financial irregularities amounting to ₦514 billion in the 2021 operations of the Nigerian National Petroleum Company Limited (NNPC Ltd).
The revelations were contained in a comprehensive audit report highlighting non-compliance and internal control weaknesses within Ministries, Departments, and Agencies (MDAs) during the 2021 financial year.
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Breakdown of Infractions
The audit detailed four major financial discrepancies within NNPCL:
“Irregular Deductions: A total of ₦343.64 billion was deducted from domestic crude oil sales at source without proper documentation.
“Sinking Fund Deposits: ₦83.66 billion, categorized as miscellaneous income, was retained in a sinking fund account.
“Unauthorised Refinery Deductions: ₦82.95 billion was deducted from federation revenue purportedly for refinery rehabilitation.
“Unsubstantiated Payments: ₦3.75 billion was flagged for transactions related to petrol sales that lacked proper verification.
The Auditor-General’s report stated that these financial activities violated the 1999 Constitution and the Financial Regulations Act of 2009, underscoring significant lapses in compliance with statutory guidelines.
According to the report, NNPCL generated ₦484.73 billion from domestic crude oil sales in March and May 2021.
However, ₦343.64 billion was deducted for various purposes, including “Value Shortfall,” “Strategic Stock Holding Cost,” and “Pipeline Maintenance.”
The deductions were made unilaterally by NNPCL without adequate documentation or justification.
Additionally, the report flagged ₦50 billion of the net payable amount for May 2021 as unaccounted for, creating a significant gap in the federation’s revenue.
“Audit observed from the review of NNPC SAP payment record for March and May 2021 payments that the sum of ₦484.73bn was the gross amount generated for the sale of domestic crude for the months of March and May 2021.
“The sum of ₦343.64bn from the gross amount was unilaterally deducted from the gross domestic crude sales as NNPC Value shortfall, Strategic Stock Holding Cost, Crude Oil and Products Pipeline Losses, as well as the pipelines maintenance and management costs.
“The details of each of the cost components deducted were not provided for audit review. Hence, the reasons for the deductions could not be justified by the management.”
On the unremitted ₦50 billion from May 2021, the report noted: “In the month of May, the net payable that could have been remitted ought to have been ₦127.075bn, but only the sum of ₦77.075bn was remitted, leaving an unremitted balance of N50bn to the Federation Account, which has remained unaccounted for.”
The report attributed these anomalies to weaknesses in NNPCL’s internal control systems, warning of the risks they pose to public funds.
It read, “The above anomalies could be attributed to weaknesses in the internal control system at NNPC, now NNPC Ltd. This is a potential loss of Federation revenue, diversion of public funds, or misapplication or misappropriation of funds.”
The success of the maiden edition of the Lagos Shopping Festival (LSF), Africa’s first 72-hour non-stop commerce and entertainment event has been credited to the Governor of Lagos State, Babajide Sanwo-Olu.
This is the view of Managing Director/Chief Strategist of Chain Reactions Africa Ltd, Israel Jaiye Opayemi, one of the main organisers of the event.
According to Opayemi, though Chain Reactions Africa conceptualised the event, the festival could be rightly described as the Governor’s baby and owes its success to his leadership. “Firstly, the Lagos Shopping Festival could not have come to fruition if the Governor did not buy into our audacious plan when we first presented the idea to him during the Covid-19 pandemic in 2020. Secondly, it was the Governor’s exemplary leadership of the project as its Chief Marketing Officer which attracted the buy-in of key sponsors like Zenith Bank, Tolaram Group, First Bank Plc, and Guinness Nigeria Plc,” Opayemi revealed.
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While the duo of Zenith Bank and First Bank provided their bank on wheel platforms for buyers at the Lagos Shopping Festival, they also supported the Vendors with special Point of Sale Machines with which to process payments from buyers. The banks were also seen marketing their diverse banking products to guests within the shopping arena.
For Tolaram, it was a time to support the citizens and give back to society. Guests at the Lagos Shopping Festival were freely given some of the products of the group such as PowerOil, Indomie and Kellogg’s packaged into goodie bags and given out to prospective buyers at the shopping arena. The Children’s Arena was however activated by Indomie with the children entertained by Santa Claus within a well-equipped arena manned by the Indomie Brands team and the Lagos State Safety Marshalls. The children were daily treated to free Indomie meals daily and given various gifts to go home with.
On its part, Guinness Nigeria came through as the real life of the Nigerian party by organizing product sampling activation for the teeming guests at the festival using brands such as Singleton, Johnnie Walker, Ciroc, Don Royale and Captain Morgan to deliver pleasant experiences to guests aside from Guinness and Malta Guinness.
While unveiling the identity of the festival last month, Governor Babajide Sanwo-Olu had thanked the management of Zenith Bank Plc, Tolaram Africa Group, Guinness Nigeria Plc and First Bank of Nigeria for supporting the idea of a Lagos Shopping Festival, describing it as a value addition on the state’s tourism calendar and the overall efforts to grow the State’s GDP. The Governor further said, “I must specially acknowledge your pioneering sponsorship role. It is easy for a corporate sponsor to jump on the sponsorship band wagon of an already established festival and fund it. But you are supporting the maiden edition of this Lagos Shopping Festival with us. The competition is watching you now. Do not build this brand with us and yield the space for the competition to take over. I do hope you would all commit long term to this brilliant initiative.”
On his part, Girish Sharma, CEO Guinness Nigeria Plc, expressed enthusiasm for the initiative. “Lagos is the commercial heartbeat of Nigeria and Africa’s entertainment capital, and the Lagos Shopping Festival captures its essence. We see opportunities in this initiative because it is a creative fusion of commerce and entertainment. This partnership reflects our dedication to fostering economic opportunities and support the nation’s vibrant entertainment industry.”
A first-of-its-kind, the festival was a convergence of commerce and entertainment, bringing together buyers and sellers in the MSME ecosystem, and hordes of fun-seekers who were entertained with thrilling performances by A-list entertainers, including Adekunle Gold, Wande Coal, Teni, Young Jonn, BNXN, Ayo Maff, SB Live and EmmaOMG. The list also included some of Nigeria’s most sought after DJs such as DJ Neptune, DJ YK Mule, DJ Baddo while Gbenga Adeyinka the 1st and Larry J dished out rib-cracking comedy performances.
Held from 23rd to 25th Day of December 2024, at the iconic Mobolaji Johnson Arena, Onikan Stadium, Lagos, the Lagos Shopping Festival saw thousands of fans throng the main venue and select Lagos malls during the three-day period to bag the latest bargains from local and top global brands.
The Nigerian Naira experienced mixed movements in the foreign exchange markets on Monday, as it depreciated to N1,665 per dollar in the parallel market, down from N1,660 per dollar recorded over the weekend.
In contrast, the official exchange rate saw the Naira appreciate to N1,534.56 per dollar, improving slightly from N1,535 per dollar last Friday, according to data released by the Central Bank of Nigeria (CBN).
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This reflects a marginal gain of 44 kobo in the official Nigerian Foreign Exchange Market (NFEM).
As a result, the gap between the parallel market rate and the NFEM rate widened to N130.44 per dollar, compared to the N125 per dollar margin recorded over the weekend.
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