Stock Market
U.S. stocks lower to start 2024, amid Apple downgrade and looming jobs report
U.S. stocks are lower Tuesday morning, with Wall Street starting the new trading year on a negative note after a 2023 rally that left the S&P 500 index just shy of a fresh record. The S&P 500 fell 29 points, or 0.6%, to 4,740.The Dow Jones Industrial Average lost 6 points to 37,683.The Nasdaq Composite eased 229 points, or 1.5%, to 14,781. On Friday, the Dow Jones Industrial Average DJIA fell 21 points, or 0.05%, to 37,690, the S&P 500 SPX declined 14 points, or 0.28%, to 4,770, and the Nasdaq Composite COMP dropped 84 points, or 0.56%, to 15,011. U.S. equities are starting the year’s first session in the red. Though the Dow is trimming earlier loses, the Nasdaq Composite is turning lower as morning trading continues. The move follows soft data from China, which raised concerns about the health of the global economy, and rising oil prices amid heightened tensions in the Middle East. An analyst downgrade for Apple Inc., one of the Magnificent Seven, wasn’t helping either. The fall is a bumpy beginning to 2024 after a blockbuster end to 2023, but by the end of last week, the S&P 500 had not revisited its early January 2022 record close of 4796.56, but the index still logged its ninth straight week of gains. New data on America’s economy keeps showing the slowing pattern. Construction spending in November was up 0.4%, lower than the forecasted 0.6% spending rise. Though lower than expectations, the numbers mark the 11th straight month of construction spending increases. Also Tuesday, the S&P manufacturing purchasing managers’ index for December was 47.9 versus the initial 48.2.
It’s just the start on a slate of economic data coming this week. The big numbers come Friday, when the Labor Department releases the December jobs report. The economy could add a forecasted 170,000 jobs, down from 199,000 jobs added in November. Before then, investors have to the gauge another sign of consumer health. A downgrade of Apple stock (AAPL) to underweight from neutral has pressured the Dow component’s stock price. Apple shares were down 3% in early trading following the Barclays analyst call pointing to slackening consumer demand. Traders are also keeping their eye on international data. Hong Kong’s Hang Seng shed 1.5% and the Shanghai Composite dipped 0.4% after an official report over the weekend showed China’s factory activity in December eased to its slowest pace in six months.
“The PMI figures indicate a slowdown in China’s economic recovery in the last months of the year,” said Stephen Innes, managing partner at SPI Asset management. This development is expected to pressure fiscal and monetary policy makers to take urgent action, especially after leaders committed to maintaining a pro-growth stance in 2024,” he added. Sentiment was further hit in the region by a deadly earthquake which hit the western Coast of Japan. The Nikkei 225 fell 0.2%. Adding to investor caution on Tuesday was heightened geopolitical angst as Iran said it would send a warship to the Red Sea after the U.S. Navy sank some of the Tehran-backed Houthi militia’s boats, Reuters reported.
Brent crude (BRN00) rose 2% to trade above $78 a barrel in response, and the move raised concerns that higher energy costs may again build inflationary pressures, This may have contributed to a 8.1-basis-point move higher in 10-year Treasury yields BX:TMUBMUSD10Y to 3.962% on Tuesday. The bond benchmark’s sharp yield fall in recent months, on hopes easing inflation will allow the Federal Reserve to soon start cutting interest rates, helped power the S&P 500 up 24.2% in 2023, to within 0.5% of its previous record close hit two years ago. Traders in derivative markets now expect 150 basis points of benchmark rate cuts in next year, according the CME’s FedWatch tool. However, many analysts remain sanguine about bond markets continuing to support stocks. “The stage is set for further gains, certainly in terms of historical trends, which suggests that the momentum could spill over into January,” said Richard Hunter, head of markets at Interactive Investor.
But “the initial tests of investors’ mettle will come thick and fast during the month,” he added. Apple Inc. shares are more than 3% lower Tuesday after a downgrade from Barclays analyst Tim Long, who said it was “time for a breather.” Long cut his rating to underweight from neutral, pointing to soft spots in consumer demand for certain Apple products. Tesla Inc. shares TSLA are up more than 0.9% in Tuesday trading after fourth-quarter delivery data beat expectations. Tesla delivered 484,507 vehicles in the fourth quarter, while the FactSet consensus was for 473,000 vehicles. Rivian Automotive Inc. shares RIVN are 9% lower following 2023 delivery data from the electric-vehicle maker. Rivian said it delivered 50,122 vehicles in 2023, a 146.5% year-over-year increase, but the FactSet consensus was for 51,000 deliveries. Dow Jones Newswires
NGX market capitalisation inched up on Thursday as equity investors gained more than N92 billion in a wide price upswing that has lasted for three days. Trading activities closed on a positive note, and the bargain hunting boosted key market performance indicators by 0.10%. The stock market index, or the All-Share Index, increased by 152.28 basis points, or 0.10%, to close at 145,476.15 basis points.
Also, NGX market capitalisation climbed by ₦97.06 billion to close at ₦92.73 trillion. Despite the negative breadth, the market rally reflects investors’ continued caution in the stock market. Stockbrokers reported buying interest in selective stocks including OANDO, WAPIC, UACN, TRANSCORP, GTCO, and others across all sectorial indexes.
In contrast, market activities inched lower as the total volume of all trades and their combine value by -14.15% and -8.47% respectively. Today, approximately 1,932.45 million units valued at ₦19,192.53 million were transacted across 23,369 deals.
FIDELITYBK was the volume driver, accounting for 9.04% of all stocks volume executed in the local bourse, followed by GTCO (8.25%), ZENITHBANK (7.90%), ETI (6.38%), and ACCESSCORP with 5.16%.
GTCO topped value chart, accounting for 19.52% of total value of all trades executed on the exchange – the highest traded on the exchange.
UACN led gainers chart, up by +10.00%, trailed by MORISON (+9.94%), ETI (+8.53%), WAPIC (+8.47%), MANSARD (+7.75%), FTNCOCOA (+7.10%), and seventeen others.
A total of twenty-eight (28) stocks depreciated, according to market report released by Atlass Portfolio Limited. With a price depreciation of -10.00%, ELLAHLAKES and EUNISELL both topped the worst performers’ chart, followed by TRANSCOHOT (-9.95%), OMATEK (-9.23%), GUINEAINS (-8.46%), and CAP (-6.16%).
Hence, the market breadth closed on a negative note, as there were 23 gainers and 28 losers. The sectoral performance was positive, as all five major market sectors appreciated. The insurance sector led with an increase of +1.56%, followed by the banking sector (+0.91%), the industrial goods sector (+0.48%), the consumer goods sector (+0.28%), and the oil & gas sector (+0.08%).
Nigerian Exchange (NGX) continued its upward trajectory on Wednesday, with the All-Share Index climbing by 0.27% to reach 145,323.87 points. NGX market capitalisation rose to ₦92.38 trillion as equities investors gained N252 billion. The market demonstrated positive momentum, reflected in a breadth ratio of 1.9x, with 30 stocks posting gains compared to 16 that declined, stockbrokers said. The bullish momentum was fuelled by interest in some oversold stocks across key sectors. Among the top performers were GUINNESS, NCR, NGXGROUP, MULTIVERSE, and SKYAVN, while VERITASKAP, LASACO, PRESTIGE, ROYALEX, and ETI experienced the most significant declines.
Stockbrokers also noted positive price movement in BUACEMENT, UBA, GUINNESS, WEMABANK, STERLINGNG, among others. The All-Share Index added 395.51 basis points to close at 145,323.87 basis points. Trading metrics presented contrasting patterns as the volume of shares traded jumped dramatically by 271.27% to 2.25 billion units, and the number of transactions increased 45.45% to 21,513 deals. Conversely, the total value of transactions dropped 47.17% to ₦20.97 billion. ACCESSCORP emerged as the most traded stock, accounting for 13.60%, followed by ZENITHBANK (13.17%), GTCO (8.70%), STERLINGNG (6.27%), and FIDELITYBK with 5.25%.
ZENITHBANK topped the value chart, accounting for 20.54% of the total value of all trades executed in the local bourse. GUINNESS led the performers chart, gaining +10.00%, trailed by NCR (+9.98%), NGXGROUP (+9.96%), MULTIVERSE (+9.95%), SKYAVN (+9.74%), OMATEK (+5.69%), and twenty-four others. A total of fifteen (15) stocks depreciated, according to data obtained from the local bourse. With a price depreciation of -4.47%, VERITASKAP topped the worst performers’ chart, followed by LASACO (-3.77%), PRESTIGE (-3.03%), ROYALEX (-2.56%), ETI (-1.88%), and CORNERST (-1.75%). Hence, the market breadth closed on a positive note, as there were 30 gainers and 15 losers, stockbrokers reported.
Sector performance showed varied results: the Banking sector led with a 0.65% gain, followed by Industrial Goods which rose 0.47%; Consumer Goods up 0.38%; and Insurance advancing 0.27%. In contrast, the Oil & Gas sector fell 0.47% and Commodities declined 0.24% Ikeja Hotels hits highest valuation in 52 weeks gaining 45 per cent
The NGX All-Share Index fell by 0.14 per cent to 143,520.53, while market capitalisation closed at N91.286 trillion for the week.
This, compared with 143,722.62 points and N91.415 trillion recorded in the previous week, reflects weaker sentiment across the market.
Investors “lost about N129 billion this week as profit-taking continued across major counters”. Most indices closed lower, except NGX CG, NGX Premium, NGX Banking, NGX Pension, NGX AFR Div. Yield, NGX AFR Bank Value, NGX MERI Growth, NGX MERI Value, NGX Lotus II, NGX Growth and NGX Sovereign Bond.
These indices appreciated between 0.01 per cent and 0.94 per cent, showing selective interest in defensive stocks. Turnover rose to 4.140 billion shares worth N115.889 billion in 102,351 deals, higher than 2.668 billion shares valued at N106.264 billion last week.
The financial services industry led activity with 3.358 billion shares worth N81.175 billion in 43,392 deals.
This represented 81.10 per cent of total volume and 70.05 per cent of total value traded during the week.
The services industry followed with 148.272 million shares worth N1.319 billion exchanged in 7,181 deals. The consumer goods sector placed third with 143.638 million shares worth N7.988 billion in 12,099 trades.
Cornerstone Insurance, GTCO and Access Holdings accounted for 2.005 billion shares worth N47.535 billion in 10,185 deals.
These three stocks contributed 48.43 per cent of total turnover volume and 41.02 per cent of total value.
Thirty-eight equities gained during the week, up from 20 recorded previously, while 36 declined, compared with 60 in the prior week.
Seventy-three equities remained unchanged, higher than 67 posted in the previous trading week. Ikeja Hotel, NCR Nigeria, UACN, CWG and Veritas Kapital emerged top gainers, advancing by N9.40, N13.55, N8.90, N1.90 and 18k, respectively.
Meyer, Sunu Assurances, UPDC, Tantalizer and Abbey Mortgage Bank topped the losers’ chart, shedding N3.05, 68k, 68k, 26k and 65k, respectively.
The NGX disclosed the listing of 243,424 additional units of the Chapel Hill Denham Nigeria Infrastructure Debt Fund.
It said, “The additional units arose from the Fund’s 2025 Q3 scrip dividend distribution to qualifying holders.”
The NGX added that the Fund’s total units have increased to 1,056,257,953 following the fresh listing.
The exchange also confirmed the extension of VFD Group’s Rights Issue following SEC approval. It said trading in the company’s rights “will now close on Friday, December 26.”
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