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U.S. Stocks Gain Ahead of Fed Decision

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NEW YORK — U.S. stocks opened higher as investors waited to see whether the Federal Reserve would decide to maintain the current pace of its bond-buying program at the conclusion of its policy meeting later today.

The Dow Jones Industrial Average gained 57 points, or 0.4%, to 15934. The S&P 500-stock index rose four points, or 0.2%, to 1785. The Nasdaq Composite Index tacked on two points, or 0.1%, to 4026.

The outcome of the Fed meeting is expected to remain in focus for most of the session Wednesday, with investors zeroed in on whether the central bank will start to taper its $85 billion in monthly bond purchases.

The purchases have been intended to spur economic growth; some analysts say recent data on the economic and unemployment front could cause the Fed to pull back on its bond buys. The Fed decision is due at 2 p.m. Eastern time, with a news conference with Fed Chairman Ben Bernanke to follow at 2:30 p.m.“Even overnight, you’re seeing people positioning ahead of the Fed meeting,” said Colin Cieszynski, senior market analyst with CMC Markets. “The bears don’t want to get too bearish in case they’re wrong, and the bulls don’t want to get too bullish.”

U.S. Stocks Gain Ahead of Fed DecisionMarkets have swung in recent weeks as traders and investors have tried to determine the outlook for Fed action this month. Stocks declined last week, with markets notching their largest single-day decline in a month in one session, on expectations that the Fed could decide pull back on its bond-buying program.

But last week’s losses followed a rally on a better-than-expected November government jobs report. The Fed has said it would watch the labor market closely to determine whether the economy was strong enough for it to take a step back. The S&P 500 is now up 0.4% so far this week.

It isn’t clear how markets will react to any move—or a signal of any future moves—from the Fed. Mr. Cieszynski said he doesn’t expect the central bank to start to pare its bond-buying efforts this month, but thinks officials could signal they want to start cutting back on easy-money policies in the early months of 2014. In that case, he said, markets could see a short-term boost but decline in 2014, in anticipation of the Fed’s step back.“As soon as we get back from the holidays, that’s on everyone’s horizon,” said Mr. Cieszynski.

Treasury prices fell ahead of the Fed decision, with the yield on the 10-year note rising to 2.879%. Rates have risen this year in anticipation of the central bank stepping back from bond-buying, with a sharp rise in early summer.

Wednesday brought signs that the housing industry is adjusting to rising interest rates, however, as new-home construction jumped by more than expected in November. The Commerce Department reported that U.S. housing starts rose to a seasonally adjusted annual rate of 1,091,000, its highest level in nearly six years. November building permits, an indicator of future construction, fell by 3.1%, a smaller drop than expected, to 1,007,000.

Gold futures rose 0.1% to $1,231.80 a troy ounce, while crude-oil futures were 0.6% higher at $98.04 a barrel. The dollar edged higher against the euro and the yen.

Meanwhile, the Stoxx Europe 600 index was 0.9% higher. Germany’s DAX added 1% amid further signs of strength for Europe’s largest economy. The Ifo institute’s business-confidence index climbed to 109.5 from 109.3 in November, hitting its highest level since April 2012 and matching economists’ forecasts.The U.K.’s FTSE 100 gained 0.2%, showing little reaction to a fall in U.K. unemployment to 7.4% in the three months to October–its lowest level in 4½ years. Economists had forecast a rate of 7.6%.

Asian markets provided a positive backdrop, as strong Japanese export data spurred a 2% gain for Tokyo’s Nikkei index. The yen’s decline against the dollar came amid speculation that Prime Minister Shinzo Abe might make a growth-strategy announcement in a speech Thursday.

Hong Kong’s Hang Seng Index rose 0.3%, while the Shanghai Composite dipped 0.1%.

In corporate news, FedEx edged up 0.5% even after it reported fiscal second-quarter profit that fell short of Wall Street forecasts. The shipping giant raised its full-year forecast for adjusted earnings, in part to account for recent share purchases.

VeriFone Systems fell 6.4% after the card-payment system maker reported earnings late Tuesday that missed analyst estimates.

Heico gained 4.1% after the aircraft-components maker beat analyst forecasts for its earnings and revenue, and gave an upbeat outlook for the new fiscal year.

– WALL STREET JOURNAL

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Nigeria Records Biggest Rise in Multidimensional Poverty Among Five Countries – UN

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Nigeria recorded the largest increase in the number of people experiencing multidimensional poverty among five countries that registered increases over their latest measurement periods, according to the United Nations Development Programme (UNDP).

The finding was contained in the 2026 Global Multidimensional Poverty Index report, released on Monday by the UNDP and the Oxford Poverty and Human Development Initiative (OPHI).

According to the report, Nigeria’s multidimensional poverty rate rose from 33 per cent in 2021 to 38.7 per cent in 2024, representing an increase of 5.7 percentage points.

SEE MORE: NNPC’s 30-Day Petrol Discount Is Not a Policy – Sowunmi

The number of Nigerians living in multidimensional poverty increased from 72.2 million in 2021 to 90.1 million in 2024, leaving an additional 17.9 million people affected.

The report noted that the latest increase reversed the progress Nigeria recorded between 2018 and 2021, when the proportion of people living in multidimensional poverty declined.

Nigeria’s Multidimensional Poverty Index value also increased from 0.175 in 2021 to 0.208 in 2024, reflecting a rise in both the incidence and intensity of deprivation.

The intensity of deprivation among multidimensionally poor Nigerians increased from 52.9 per cent to 53.6 per cent over the same period.

Unlike income-based poverty measures, which assess poverty based on how much people earn or spend, the Multidimensional Poverty Index examines overlapping disadvantages experienced in daily life.

The index measures deprivation across three dimensions: health, education and standard of living.

Its 10 indicators include nutrition, child mortality, years of schooling, school attendance, cooking fuel, sanitation, drinking water, electricity, housing and household assets.

A person is classified as multidimensionally poor when their household experiences deprivation in at least one-third of the weighted indicators.

The report showed that Nigeria had made progress in reducing multidimensional poverty before the latest increase.

The country’s index value declined from 0.230 in 2013 to 0.202 in 2018 and 0.175 in 2021 before rising to 0.208 in 2024.

Similarly, the proportion of Nigerians living in multidimensional poverty fell from 42.3 per cent in 2013 to 37.2 per cent in 2018 and 33 per cent in 2021 before increasing to 38.7 per cent in 2024.

The number of affected Nigerians also declined from 76.3 million in 2018 to 72.2 million in 2021 before climbing to 90.1 million in 2024.

The report further highlighted significant differences in multidimensional poverty across Nigeria’s subnational regions, with incidence ranging from 3.7 per cent to 88.3 per cent across the regions covered by the analysis.

It compared Yobe and Sokoto, two of Nigeria’s poorest subnational regions with similar Multidimensional Poverty Index values, to illustrate how the forms of deprivation experienced by communities can differ despite comparable overall poverty levels.

Globally, the report estimated that 1.2 billion people across 108 countries lived in acute multidimensional poverty.

Sub-Saharan Africa accounted for 616 million people living in multidimensional poverty, while South Asia followed with 393 million.

The report also found that 83.3 per cent of the world’s multidimensionally poor population, equivalent to approximately 998 million people, lived in rural areas, compared with 200 million in urban areas.

Children below the age of 18 accounted for 617 million, or 51.5 per cent, of the world’s multidimensionally poor population.

In sub-Saharan Africa, 355 million children lived in multidimensional poverty, accounting for 57.7 per cent of the region’s poor population.

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ADF Targets 5 Million Students, 2 Million Vulnerable Women

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In a bold move to deepen retail participation in Nigeria’s capital market, the Aliko Dangote Foundation (ADF) has unveiled a share grant initiative aimed at helping up to five million tertiary students and two million vulnerable women become shareholders in Dangote Petroleum Refinery and Petrochemicals (DPRP) through its Initial Public Offering (IPO).

Managing Director and Chief Executive Officer of ADF, Zouera Youssoufou, disclosed that the Foundation will match qualifying share subscriptions by eligible beneficiaries. Under the programme, students who subscribe for the minimum 10 shares worth N5,250 will receive an additional 10 shares funded by the Foundation, subject to the approved process and allocation, effectively doubling their holdings to 20 shares.

Speaking during a television interview, Youssoufou said the initiative was designed to turn the refinery’s “People’s IPO” vision into reality by giving traditionally underserved groups a direct stake in one of Africa’s largest industrial assets.

“When Aliko announced the IPO, he described it as the IPO of the people and wanted as many Nigerians as possible to participate,” she said.

READ ALSO: FG Lacks Capacity to Meet Dangote Refinery Crude Demand

According to her, students and vulnerable women were specifically selected because they have historically been underrepresented in the capital market.

The ADF said it is prepared to support up to five million students enrolled in Nigerian tertiary institutions, including universities, polytechnics and colleges of education. Eligible applicants must be at least 18 years old and enrolled in a recognised institution. The Foundation is working with relevant educational authorities to verify beneficiaries.

Youssoufou revealed that about N25 billion has been earmarked for the student component of the scheme, while the broader programme for students and vulnerable women is valued at approximately N40 billion.

She emphasised that the intervention is a grant, not an investment, with all shares ultimately belonging to the beneficiaries.

“The shares end up with the beneficiary. Our goal is to help people who may never have had the opportunity to own shares begin building long-term wealth,” she said.

Beyond students, ADF plans to support up to two million vulnerable women, including widows, women living in extreme poverty, persons with disabilities, and widows of members of the Armed Forces. The Foundation is partnering with state governments, the Ministry of Women Affairs, the Armed Forces and other institutions to identify eligible participants.

According to Youssoufou, the initiative is not only about widening ownership in the refinery but also about promoting financial literacy, encouraging a culture of savings and investment, and helping Nigerians build sustainable wealth through participation in the capital market.

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FG Lacks Capacity to Meet Dangote Refinery Crude Demand

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Nigeria’s efforts to increase production and curb crude oil theft still leaves her short of meeting the demands of the 700,000 barrels demand of the Dangote Petroleum Refinery and Petrochemicals (DPRP).

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, made the disclosure during an interview on Channels Television’s Politics Today at the weekend.

The disclosure comes amid renewed debate over government intervention in the petroleum market, with proposals for production subsidies, the 30-days petrol discount and other measures to support domestic refining and reduce the cost of petroleum products.

READ ALSO: Fuel Discount: Presidency Explains Why Atiku’s Production Subsidy Proposal May Fail

He explained that Nigeria’s total crude oil production does not translate into an equivalent volume available for allocation by the government.

Oyedele said Nigeria’s crude oil production of about 1.8 million barrels per day was shared among parties operating under production-sharing contracts and joint ventures, while production costs, royalties and other obligations further reduced the volume available to the government.

“Under the production-sharing contract and joint venture, they share these things, and the ratios vary. Let’s say roughly 45:55,” he said.

He explained that oil producers first recover eligible production costs through cost oil, while royalties and contractual sharing arrangements also determine the quantity ultimately accruing to the government.

“The long and short of what I’m telling you is whatever is left for Nigeria, we exhaust it almost entirely because of fuel subsidy,” he said.

According to the minister, the situation was particularly severe before President Bola Tinubu introduced the economic reforms in May 2023, when the Nigerian National Petroleum Company Limited (NNPC Ltd), which holds the country’s crude on its behalf, had less than 100,000 barrels of freely available crude remaining.

He said the government had exhausted much of its revenue and resorted to printing money before turning to future crude oil production to secure commitments used to finance present consumption.

“That was a ticking time bomb,” Oyedele said, describing the arrangement under which future oil production was committed to support current fuel consumption.

The minister, however, acknowledged improvements following increased production, efforts to reduce crude oil theft and the renegotiation of some existing commitments that had tied down the country’s crude.

He cited comments by business leader Tony Elumelu, who had previously expressed frustration over the scale of crude oil theft in Nigeria, and subsequently reported an improvement in the situation.

Despite these gains, Oyedele said the country was yet to attain the level of freely available crude required to supply the Dangote refinery with its full daily requirement.

“But we are still not at the point where we can give Dangote 700,000 barrels,” he said.

The minister dismissed proposals for the government to supply the refinery with discounted crude or at production cost, arguing that such proposals failed to recognise the constraints on the volume of oil available for allocation.

“We don’t have enough to service Dangote. Dangote imports crude,” he said.

He added that the naira-for-crude arrangement introduced by the Federal Government had helped provide some stability but had not eliminated the supply constraints.

According to him, sustained increases in crude oil production and the release of additional barrels from existing commitments would eventually enable Nigeria to meet the requirements of Dangote and other domestic refiners.

“As we ramp up production and we free up some barrels, we’ll get to a point where we’ll be able to give Dangote everything he wants and other refiners will be able to get enough,” he said.

Oyedele also expressed hope that Nigeria would eventually refine all the crude oil it produces domestically and export refined petroleum products rather than crude.

The disclosure comes amid renewed debate over government intervention in the petroleum market, with proposals for production subsidies and other measures to support domestic refining and reduce the cost of petroleum products.

Oyedele further maintained that achieving that ambition will depend not only on the expansion of refining capacity but also on sustained growth in crude oil production and the availability of additional volumes for domestic processing.

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