Wall Street equities post worst week since depths of the financial crisis in 2008
Nigeria Equities Market dwindled by 62bps amid sustained profit taking activity as the market capitalization breached the 14 trillion mark to close at 13.96 trillion at the close of trade.
The Exchange recorded 19 losers as against 13 gainers at the close of trade hence, the year to date gain of the Local bourse moderated to 0.13%.
Investors continued to be bearish on banking stocks like Access, Guaranty and Zenith bank which shed 2.78%, 2.22% and 0.26% respectively thus moderating the NSE banking index by 1.38%.
Similarly, the NSE Consumer Goods and NSE Oil/Gas moderated by 0.89% and 0.55% respectively.
Meanwhile, market activity was upbeat as total volume and value of stocks traded rose by 1.38% and 63.69% to 0.23 billion units and N4.48 billion respectively.
Elsewhere, NIBOR and NITTY moved in different directions for all tenor buckets tracked.
In the OTC bonds market, the values of FGN bonds rose for most maturities tracked amid buy pressure; however, FGN Eurobond prices moderated for most maturities tracked amid profit taking.
Meanwhile elsewhere in Georgiadis London, Hudson Lockett in Hong Kong, Richard Henderson in New York
US and European markets slumped into correction territory on Thursday as selling pressure driven by the spread of the coronavirus produced the worst week for American stocks since the depths of the financial crisis in October 2008.
The S&P 500 fell 2.4 per cent in early trading in New York, bringing its decline since an intraday peak last week to more than 10 per cent, marking the start of what traders define as a correction.
The Stoxx 600 index of European shares dropped by 4 per cent to lodge a similar decline for the week. With sentiment souring through the trading day the FTSE 100 and the German Dax fell by similar levels.
European markets are set for their worst week since the eurozone sovereign debt crisis in 2011. Since its January peak, the FTSE All World index has shed around $5tn in value.
The 10-year US Treasury note yield touched a record intraday low of 1.2474 per cent, as investors bought government debt in an accelerating rush into haven assets. Yields fall when prices rise.
Oil price falls deepened, with global benchmark Brent crude down 3.9 per cent at $51.37 a barrel, its lowest level since 2017.
Column chart of Stoxx Europe 600 weekly % change showing European stocks on course for their worst week since 2011
Investors have spent the week scrambling to price the likely economic impact of the virus, which has quickened its spread from Asia-Pacific across the world in recent days. The latest bout of market selling came after the US Centers for Disease Control and Prevention late on Wednesday confirmed a possible instance of community transmission of Covid-19 in California.
There’s no reason to panic
The CDC said it had confirmed the infection in a person who apparently had not travelled to China recently or been exposed to another known coronavirus patient. There are now a total of 15 confirmed cases in the US.
US president Donald Trump said at a press conference late on Wednesday that he had tapped Mike Pence, the US vice-president, to co-ordinate Washington’s response to the spread of the coronavirus.
Mr Trump said that the “risk to the American people remains very low . . . There’s no reason to panic”.
Coronavirus cases have spread to countries including South Korea and Italy and Mr Trump said other nations besides China might be “cut off” from US travel at some point.
The World Health Organization said on Wednesday that new cases reported outside China had exceeded those within that country for the first time.
Havens rose again on Thursday with gold adding 0.8 per cent to $1,653 per ounce.
“The price action since the weekend is a clear departure from the strikingly calm conditions of prior weeks,” said Tim Graf, a strategist at State Street.
He said heightened risk and volatility due to the coronavirus “should keep the already-strong demand for safe haven assets in place”.
Moves in Asian stock markets were more measured, although Japan’s Nikkei significantly underperformed as it fell 2.1 per cent.