Business
Stock Futures Drop After Weak China, Europe Data
NEW YORK — U.S. stock futures fell Thursday, with blue chips headed for a third-straight loss, as signs of slowing growth in China and Europe unnerved investors ahead of jobless claims and inflation data.
European markets were broadly lower after data showing economic activity surprisingly declined in February.
About 90 minutes ahead of the open, Dow Jones Industrial Average futures lost 35 points, or 0.2%, to 15981. On Wednesday, the Dow erased an early gain of as much as 95 points to close down 90 points, or 0.6%, after falling 24 points on Tuesday.
S&P 500 index futures gave up five points, or 0.3%, to 1320 and Nasdaq-100 futures fell 15 points, or 0.4%, to 3639. Changes in stock futures don’t always accurately predict stock moves after the opening bell.The S&P 500 had risen in intraday trading Wednesday to less than one point below its Jan. 15 record closing high of 1848.38, before turning lower to close down 12 points, or 0.7%. The late selloff occurred after minutes from the Federal Reserve’s January policy meeting showed that some Fed officials felt interest rates may need to be raised sooner than expected.
Also weighing on sentiment Thursday, HSBC’s China preliminary manufacturing purchasing managers index dropped to 48.3 in February from 49.5 in January, signaling further contraction in the world’s second-biggest economy.
Separately, Markit said its composite purchasing managers index for the euro zone slipped to 52.7 in February from January’s 52.9, missing expectations of a rise to 53.0. Readings above 50 signal expansion.
Further violence in Ukraine, which broke a truce agreement reached Wednesday, added to investor jitters.
John Canally, investment strategist at broker-dealer LPL Financial, said with earnings season largely over, investors will be refocusing on macro issues, such as global growth, the Fed and geopolitical events. That said, Mr. Canally feels “it is somewhat encouraging” to see the market not hit harder this morning following disappointing data from China and Europe.“The market seems to have given the U.S. economic data a weather-related ‘free pass’ for January and February, but now seem to be extending that courtesy to overseas data,” Mr. Canally said.
He added that his view on the Fed hasn’t changed, despite the hawkish tone inferred by investors from the January policy-meeting minutes. He believes the Fed is still “committed to keep rates low” through at least 2015.
At 8:30 a.m. Eastern, initial claims for jobless benefits are expected to slip to 335,000 in the latest week from an original estimate of 339,000 the week before. At the same time, the consumer-price index for January is seen rising 0.1% on the month, or by 0.2% when excluding food and energy components.
After the open, the Conference Board’s leading economic index for January is forecast to rise 0.4%, and the Philadelphia Federal Reserve’s February index of manufacturing activity is expected to slip to 7.4 from January’s 9.4.Among early stock movers, Facebook shed 3.2% in premarket trading after saying late Wednesday it agreed to buy smartphone-messaging company WhatsApp for $19 billion in cash and stock. Facebook had closed Wednesday at an all-time high, after gaining 25% so far this year.
Tesla Motors surged 12% after the electric-car maker reported late Wednesday fourth-quarter earnings that beat analyst estimates and provided an upbeat 2014 outlook.
Dow component Wal-Mart Stores declined 1.1% after the world’s largest retailer reported fiscal fourth-quarter earnings at the low end of its previously-lowered forecast range. It also provided a current-quarter outlook that was below analyst estimates.
In other corporate news, Safeway rallied 4.8% after saying late Wednesday it was in discussions about a possible sale of the company. The grocer also said it would distribute the remaining 37.8 million shares its owns — a 72.2% stake — in Blackhawk Network Holdings to Safeway’s shareholders. Blackhawk’s stock was still untraded ahead of the open.
The yield on the 10-year Treasury note ticked lower to 2.726% from 2.730% late Wednesday.Gold futures declined 0.6% to $1,312.80 an ounce, after snapping a nine-session win streak on Wednesday. Crude-oil futures eased 0.2% to $102.63 a barrel, after settling at a 4 1/2-month high on Wednesday. The dollar edged higher against the euro, but lost ground against the Japanese yen.
In Europe, the Stoxx Europe 600 shed 0.7% and was headed for its second decline in 12 sessions. It had been down as much as 1.1% earlier in the session. Germany’s DAX 30 index slid 1.3%, France’s CAC 40 gave up 0.4% and the U.K.’s FTSE 100 lost 0.4%.
Some analysts said investors shouldn’t be too discouraged by the slowing in economic activity in the euro area. The data suggested a “pause” in the recent economic improvement, said economists at BNP Paribas. “Manufacturing sentiment hardly ever improves in a straight line, and a little wobble here and there doesn’t automatically imply a shift in trend,” they said.
Asian markets also fell. Japan’s Nikkei Stock Average slumped 2.2% as the weak Chinese data strengthened the yen, which weighed on exporter shares. China’s Shanghai Composite eased 0.2%.
– WALLSTREET JOURNAL
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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