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 Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 8:44am On Aug 19, 2015 |
http://businessdayonline.com/2015/08/dollar-shortage-reality-bites-from-large-firms-to-small-traders/ Dollar shortage reality bites from large firms to small traders Nigerian businesses large and small are beginning to feel the impact of the current dollar shortage and devaluation in the black foreign exchange FX market . Since the Central Bank of Nigeria (CBN) cut dollar access to importers of 41 types of goods, ranging from private jets to rice, Eurobonds and foreign shares, importers say they have been unable to pay suppliers, while elevated demand in the black market has led to the naira trading as low as N240 per dollar. The cash deposit restrictions placed on Nigerians operating domiciliary accounts has also meant most traders have been unable to order for goods as quickly as before. “I used to be able to easily send money to the U.S for my partner to ship my goods down,” said Solomon Ndubuisi, a dealer in imported female bags and shoes, in a downtown Lagos market known as Balogun. “The CBN daily withdrawal limit of $300 has changed all that now and I have to wait for up to three weeks to gather a reasonable sum. The black market rates are expensive and we can’t really increase prices because customers are not buying as much anymore.” The more than 50 percent slide in oil prices since 2014 has negatively hit government spending and its trickledown effect to consumer spending in Africa’s largest economy. The dollar shortage that the fall in hard currency earnings has caused has led to a huge premium for dollars sold on the black market which is slowing down trade and consumption that make up a big chunk of Nigeria’s GDP. The International Monetary Fund (IMF) estimates Africa’s largest economy will expand by 4.8 percent in 2015, less than the 6.8 percent of 2014. For larger companies operating in the country, a big problem is the pressure on earnings from the naira drop. “Nigerian Breweries (NB) reported its 1H FY15 numbers which were poor across the board,” Renaissance Capital Analysts Omair Ansari and Olaloye Oyawoye, said in a July 23 note. “We have lowered our industry and company growth forecasts for FY15 and FY16 as the consumer remains severely constrained. We expect further downside to margins, given pressure on the naira.” Shoprite Holdings Ltd.’s said in the statement yesterday that Nigerian sales “were negatively affected by the drop in oil prices and the currency depreciating against the U.S. dollar.” MTN Group Ltd., Africa’s largest wireless operator, said on August 5 first-half profit declined 11 percent, missing analysts’ estimates, as sales fell in the company’s largest market and foreign-exchange movements in the rand against the naira weighed on earnings. The naira has fallen some 22 percent in the past year on the interbank market, to N199 per dollar. Nigeria’s dollar reserves are down one-fifth to $31.6 billion since the end of September 2014. Investors have sold down stocks of companies operating in Nigeria as a result of the dollar availability uncertainty. The Nigeria Stock Exchange declined by 2.59 percent to 29,909.44 points on Monday, dragging the index to a four month low, of -13.70 percent. “We believe investors are apprehensive of the current risk- return profile of the Nigerian economy, especially with falling global oil prices, unstable exchange rate and the uncertain policy direction of the current government,” said Meristem Securities analysts in a Aug 17 market update. "TRUTH IS BITTER BUT IT SETS YOU FREE"  |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:40pm On Aug 18, 2015 |
Nigerian central bank Governor Godwin Emefiele is losing the battle to prevent the naira from going the way of other oil-dependent currencies. After imposing trading restrictions in February to prevent dollars from fleeing the economy, importers have been unable to pay suppliers, a thriving black market has sprung up in foreign banknotes and teachers have gone unpaid. The naira has been stable over the past six months since the central bank introduced regulations to halt a 20 percent decline in the currency in the 12 months through Feb. 12 to a record low of 206.32 per dollar. That’s heaping pressure on the authorities to ditch the rules and let the naira weaken alongside Russia’s ruble, Colombia’s peso and Norway’s krone. Forwards prices suggest the currency of Africa’s biggest oil producer will tumble 15 percent within six months and 25 percent over the next year. “Their currency is still very overvalued and so they’re going to remain under pressure to allow it to depreciate,” said Gareth Brickman, an analyst at Stamford, Connecticut-based ETM Analytics. The central bank has fought depreciation “tooth and nail, every step of the way,” he said. Emefiele, 54, has said the exchange rate is “appropriate” and argues that allowing it to weaken would stoke inflation in a country that imports almost all its manufactured goods. The strong currency and a scarcity of dollars are hurting growth, which the International Monetary Fund estimates will be 4.8 percent in 2015, less than half the average over the past decade. Traders are speculating Emefiele will have to change tack and abandon efforts to crack down on speculators. He bolstered the rules after a strategy of burning through foreign reserves failed to stop the naira sliding to a record 206.32 per dollar on Feb. 12. Devaluation Forecasts ETM’s Brickman predicts the central bank will be forced to devalue the currency by about 10 percent by year-end to 220 per dollar, from 199.05 at the market close in Lagos on Monday. Currency trading has “dropped dramatically” under the new rules, said Craig Thompson, a broker at Nyon, Switzerland-based Continental Capital Markets SA. “It’s a fraction of what used to go through.” The trading curbs, together with the more than 50 percent drop in oil prices since mid-2014, are weighing heavily on Nigeria, which relies on crude for almost all its foreign earnings. Banks are increasingly wary of lending to individuals and Nigeria’s main stock index has dropped 16 percent since the start of April, matching the decline in the whole of 2014. Ibrahim Mu’azu, a spokesman for Nigeria’s central bank, defended its currency policy and said authorities would meet companies’ legitimate demand for foreign exchange. Scrapping the rules is all but inevitable to many traders, making a weaker naira an obvious bet. Standard Chartered Plc, which gets more than half its revenue from emerging markets, predicts a decline to 222 by year-end, while Goldman Sachs Group Inc. sees it falling to about 230. Forward prices compiled by Bloomberg signal levels of 228.15 in six months and 248.5 in a year. Emefiele, a former chief executive officer of Zenith Bank Plc -- Nigeria’s second-biggest lender by market value -- isn’t the only African policy maker trying to protect his currency against the drop in oil. Angola’s kwanza, which has slumped 23 percent in the past year, has been little changed this month as the nation props up the exchange rate by spending reserves. As with the naira, that’s just storing up losses for the future, said John Ashbourne, an Africa economist at London-based advisory firm Capital Economics Ltd. He sees the naira falling as much as 8 percent to 210-215 per dollar and the kwanza losing up to 15 percent of its value by year-end. China’s yuan devaluation this month has increased pressure on their central banks to devalue, Ashbourne said. “The currencies were both too strong before,” he said. “They’re still too strong.” http://www.bloomberg.com/news/articles/2015-08-17/pressure-building-on-nigeria-as-naira-out-of-step-with-oil-peers A STITCH IN TIME SAVES NINE |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:33pm On Aug 18, 2015 |
http://nairametrics.com/analysis-has-the-cbn-lost-its-independence/ [ANALYSIS] Has The CBN Lost its Independence? | NAIRAMETRICS Meanwhile black market dealers are selling the dollar at near N225 never mind Emefieles moves to eliminate them by cutting trees. In basic economics when a good becomes scarce, the price must adjust higher to reduce demand and force substitutes. The CBN has refused to adjust the naira currency, even when the price of oil has plummeted therefore reducing the availability of dollars in Nigeria. It has also made matters worse by limiting the ability of ordinary Nigerians to freely operate their dollar denominated accounts. In effect creeping capital controls Analysts are now calling for further fall in oil prices to perhaps test the $30 mark. Nigerias currency the Naira has historically tracked the global oil price. The CBN must know that it is fighting a war it cannot win against global headwinds (strong dollar, weak Chinese growth) that have affected all EM currencies from the South African Rand to the Brazilian Real. Markets must be made to believe that when the CBN speaks it has a coherent credible agenda, devoid of political interference. Investors are now paying the price, at the end of the day CBN will have no choice than to devalue the NAIRA. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 3:05pm On Aug 17, 2015 |
angrybull:Today N4 is their lowest ever thanks to their bogus right issue  |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:36pm On Aug 17, 2015 |
Yem0350:The last time it touched that point was in September 2010 during Oteh saga. Amazing forum cum analyst, well i'm surprise nobody is shouting BUY BUY BUY again while this actually the time wise investors ought to break the bank and start buying in tranches.  What is happening now is simply called WEALTH TRANSFER. Only the pigs gets slaughtered while the bargain hunters are quietly taken position. *ThE OcToPuS * 1 Like |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 1:00pm On Aug 17, 2015 |
myjoy08:http://www.bloomberg.com/quote/ACCESS:NL Access is already N4 so whats the difference? Well the much awaited September is around the corner, So bargain hunters sharpen your cutlasses |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:45pm On Aug 16, 2015*. Modified: 3:19pm On Aug 16, 2015 |
angelo82:Well one of my main yardstick for measuring Stocks is via their year lowest lows bcoz i believe history has a way of repeating itself. In Feb 2012 after the Fuel subsidy removal palaver UBA traded below #1:70k. While that of FBNH since Arisekola who happen to be their major shareholder died, I see their case turning to the likes of UBN. And if what I'm thinking happens to the Elephant it will definitely drag Access and every other banks down. Bottomline if you areant in for a long term atleast 2yrs and above better pack ur bags and baggages. So you can always have a pleasant night rest . I rest my case. *ThE OcToPuS * |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 5:45am On Aug 16, 2015 |
PETERiCHY:I gave the above prediction on 23rd March 2015, Likewise since mid-last year i ve been screaming that short term traders should stay off the market. Well one good thing about the BEAR is that it humbles the doubting Thomases and move them closer to GOD. Above all it creates a wonderful BARGAIN opportunity for long-term investors, @ this junction I will still advise short term traders to cut and run with their losses because we are still on a long scary ride *ThE OcToPuS * 2 Likes |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 11:27am On Aug 13, 2015 |
Tjohn1:Before do you expect it to keep moving up without refuelling at a point? Well that reminds me of the batch of Transcorp i bought in May 2012 @ 53k within 1month it got to N1:45k though it refuelled around N1:00 checkpoint just like Evansmedical is doing rightnow. Note: I don't ve a unit of Evansmedic and I don't intend to buy any other stock this year aside OANDO. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 9:59am On Aug 12, 2015 |
angrybull:Have you forgetten the events that surrounds their right issue. *It was initially pegged at N9. *They suspended trading. *later they brought it down to N6:90. Now we are seeing how their shenanigans is playing out, they call themself AccessBank and now they are using that access to torment their shareholders |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 5:23am On Aug 12, 2015 |
FranklinRich:Their bogus right issue was done at N9 so anything in the neighborhood of N4:50k is a bargain. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 1:05pm On Aug 11, 2015 |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 9:53am On Aug 07, 2015 |
http://www.vanguardngr.com/2015/08/naira-depreciates-by-n7/ despite CBN’s intervention on banks’ dollar payment The naira yesterday could not sustain the gains recorded on Wednesday, as it depreciated against the US dollar in the parallel market, closing at N222 to a dollar. This represents a depreciation of N7 from Wednesday when a dollar exchanged for N215 in Lagos and Kano, and N220 to a dollar in Abuja. Also, the Central Bank of Nigeria, CBN yesterday directed that banks should pay for their dollar purchases 48 hours in advance. Sources from the Bureaux De Changes (BDCS) said that the gains recorded on Wednesday could not be sustained yesterday due to the fact that the dollar sold to them by the CBN was bought by people that felt that the naira would fall as the CBN may not be able to sustain the sale of more dollar to the parallel market. Meanwhile, CBN has directed commercial banks to pay for their dollar purchases 48 hours in advance, after banning them from accepting foreign currency cash deposits to curb dollar demand and stem illicit financial flows. Reacting to the *development, BDC operators said banks would struggle to buy dollar on behalf of customers, while the ban on dollar cash deposits would stem speculation. The CBN in June curbed access to the interbank currency market to preserve its foreign reserves. The move led to the diversion of dollar demand to the black market, weakening the local currency. “We are now required to deposit the naira equivalent of our total forex bids to the central bank 48 The measures led to a sharp increase in interest rates on the interbank market, traders said. “The new measure has taken out some huge naira liquidity in the market and putting pressure on the cost of funds among banks,” one dealer said. The overnight lending rate jumped to 50 percent on Thursday from 12 percent the previous day, amid low liquidity as some banks scrambled to stock up on the naira to back up their forex demand with the central bank. Ugo Okoroafor, communications adviser to the CBN Governor had explained that the ban on dollar cash deposits with commercial banks was aimed at curbing the “increasing dollarisation of the economy.” Meanwhile, on Wednesday , it was gathered that the CBN issued a circular to sell additional $30,000 to all licensed bureaux de change (BDCs) in the country on Friday, apart from the weekly sale of $30,000 that the apex banks normally makes to each BDC. Earlier in the day on Wednesday , naira exchanged for as high as 235 to a dollar, but a parallel market source noted that the news of the CBN circular prompted various firms to hurriedly sell off the dollars in their possession leading to increase in supply of dollars to the market and thus crashing the exchange rate. The hurried sale is in anticipation that the market would be flooded by dollars when the additional sale is made by the apex bank on Friday. The official exchange rate remains pegged by CBN at N197 to a dollar. Vanguard investigations on Tuesday had revealed that the naira depreciation was as a result of panic buying of the dollar in the hope that it would further depreciate. Sources said that there was hoarding of foreign currency going on at the unofficial market. They said that the appreciation of the naira last week was temporary and that the exchange rate was most likely to return to its previous level. The naira had last week appreciated by N35 fromN245 per dollar to N210, due to excess dollars in the market, occasioned by refusal of banks to allow foreign currency deposits into domiciliary accounts. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:28pm On Aug 06, 2015 |
myjoy08:That's was why I told you that what I'm mostly after is STABILITY bcuz I won't be happy to exchange my USD today @N240 only for me to wake the next day and see it trade @N500 |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:08pm On Aug 06, 2015 |
angelo82:Well by Godsgrace my salary is pegged to USD. So whichever way it goes the guns are mine. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 1:49pm On Aug 06, 2015 |
myjoy08:Bear in mind i have a sizeable fund in NSE which I repatriated at an average rate of N170 per USD last year. So since this year I'm not taking any chances at all in other words what im mostly after is STABILITY. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 1:19pm On Aug 06, 2015 |
myjoy08:http://businessdayonline.com/2015/08/nairas-fortune-nosedives-loses-n13-at-bdc-parallel-market-segments/ |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 5:32am On Aug 05, 2015 |
https://www.nairaland.com/2501718/naira-appreciation-why-nigerians-should Is the value of the Naira really appreciating in the real sense or the CBN and the FG are playing pranks on Nigerians? Why are commodities still high in the market? Ideal Situation Ideally, customers operating domiciliary accounts will go to the banks, deposit their dollar and through that account they do whatever transaction that they deem necessary. The Banks inturn will take the dollars(and other foreign currencies) to the CBN. The Buhari/Emefiele Situation 1. The CBN has stopped receiving dollars from banks, as a result the banks has stopped accepting dollars at the counter because their vaults are full. 2. Because of the restriction at 1(above) the demand for dollar reduces in the BDC. The BDCs seek every means to trade the currency including reducing the cost at the black market. The CBN will go to the press to scream "NAIRA IS APPRECIATING." 3. As a result of 1(above) the banks also refuse to request dollars from the CBN's foreign exchange reserve. The CBN will then come out to scream "RESERVE IS GROWING". Is that the best way to manage the naira? Salient Question and Effects: 1. What happens to a businessmen with domiciliary account seeking to deposit dollars and transfer to their partners abroad after buying the dollar from BDC or Bank? 2. The bank's refusal to accept dollar deposit means business transaction on that will be halted. Because no domiciliary account holder will be willing to withdraw from his account when he knows that he won't be able to make further deposit due to the CBN's policy except if his intention is solely for converting the dollar to naira for local transaction. 3. Instead of doing transactions from domiciliary account, businessmen will be left with no choice but to operate domiciliary account in neighbouring countries where they will be making transactions or resort to wiring money via Western Union in neighboring country. 4. As a result of 3(above) the cost of commodities will go UP because businesses will make up for the extra expenses. Also, that will mean reduction in business activities in the banks. 5. Should the above persist it will get to a certain point where there will be scarcity of the dollar in the market. When it get to that point, the dollar rate is astronomically shooooooot up in the market because demand will outweigh supply. At this point, the naira problem will be worse than it was. Is The Naira Really Appreciating? Make no mistake, the naira-dollar rate is yet to appreciate in the international market. As at May 29 the naira/$ rate was N199 in the market. The rate as at today Aug 5, 2015 is still N199. You can't appreciate a currency via the backdoor. Even the black market rate cannot be regulated through the back door. What "Sane" Countries Does: The CBN Governor Godwin Emefiele made it look like one can't deposit foreign currencies in cash in another country. This is contrary to the facts on ground. No country will shut down foreign currencies transactions in banks. Let me give two instances... On February 27, 2015, the Central Bank of Egypt instituted a new policy to help the Egyptian pound. As part of the policy, Individuals and businesses are allowed a maximum of $10,000(or equivalent) deposit daily and $50,000(or equivalent) monthly. The measure would stop companies from buying large amounts of dollars from the black market and then depositing them briefly in banks in order to open letters of credit for imports. In China the maximum daily deposit/withdrawal of foreign currencies is $10,000(or equivalent). Is it not better to place a transactional limit for foreign currencies than discourage deposit completely(that will solve nothing)? We don't produce, we import, we have no policy to promote local production nor infrastructures in place toencourage manufacturers, yet we expect the naira to appreciate. That's is no done anywhere. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:45am On Aug 05, 2015 |
FranklinRich:Why bother yourself replying him. I thought they say silence is the best answer to a fool or can't you see frustration written all over his post |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 4:30pm On Aug 04, 2015 |
PETERiCHY:[www.proshareng.com/news/Corporate%20Earnings/OANDO-Energy-resources-announces-Q2-2015-Results-Proshare/28133]. Have a look at it! http://www.proshareng.com/news/Corporate%20Earnings/OANDO-Energy-resources-announces-Q2-2015-Results-Proshare/28133 |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 3:34pm On Aug 04, 2015*. Modified: 3:51pm On Aug 04, 2015 |
FranklinRich:From your analysis I can see you are quite conversant with the game and if care is not taken when this CBN unconventional measures will boomerang USD will hit the rooftop |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 3:12pm On Aug 04, 2015 |
http://thenationonlineng.net/chadians-ghanaians-others-storm-nigeria-for-dollars/ Currency speculators from Chad, Ghana, Benin Republic and other neighbouring countries yesterday trooped to Nigeria in a scramble for cheaper dollars. The speculators, The Nation learnt, took advantage of the early morning drop in dollar rates — at N202 to the dollar in Abuja and N210 in Lagos — to make brisk purchases. But the greenback recovered late afternoon to close at N208 and N222 in Abuja and Lagos. Banks have been rejecting dollar deposits across the counter, but inflows from foreign accounts are allowed. They lenders said they are unable to transfer excess liquidity to their correspondent banks overseas which are restricting importers from using domiciliary accounts. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:56pm On Aug 04, 2015 |
http://businessdayonline.com/2015/08/naira-weakens-on-parallel-market-as-dollar-demand-rises/#.VcC-9_NVhHw The naira reversed its gains against the dollar on the parallel market on Tuesday on increased demand for the U.S. currency from some importers, traders said. The local currency was trading at 224 to the dollar on Tuesday, weaker than 216 the previous day. It was quoted at 240 a week ago. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 11:54am On Aug 04, 2015 |
Processor01:Point of correction, I'm not here to please anybody, in other words when I make a comment it's either you take it or leave it. The funny person that said he stop reading my post 6mths ago. If I may ask does that add anything to my acct ? Well all i can see here is the adverse effect of a BEAR market and i pray may GOD in his infinite mercies mend and heal those that NSE has broken their HEART *ThE OcToPuS* 1 Like |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 3:25am On Aug 04, 2015 |
Dragonking:I comfortably sold 90% of my holding last week Wednesday @N240 after noticing it drag btw N241/N243 the previous 7days. You can check my posts. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:47pm On Jul 29, 2015 |
angelo82:Well for some days now I noticed that dollar is having some stability so I had to release some @ the rate of N240. So let's see how it goes. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 2:35pm On Jul 29, 2015 |
myjoy08:Got some OANDO @12:50k not a buy recommendations coz we are on a long thing |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 10:45am On Jul 28, 2015 |
megainvest:That shows you that NAIRA is fast turning into a tissue paper. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 8:38am On Jul 28, 2015 |
megainvest:Buy US dollar and have your peace of mind. |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 7:59pm On Jul 27, 2015 |
Like play play like play play, Another GLOBAL MELTDOWN is staring us in the face though it will be precede by a PHENOMENAL BULL, So make una coolu temper.he that has ears let him hear. *ThE OcToPuS * |
| Investment › Re: Nigerian Stock Exchange Market Pick Alerts by PETERiCHY(m): 3:29pm On Jul 24, 2015*. Modified: 3:58pm On Jul 24, 2015 |
myjoy08:NAIRA is already devaluing itself only a daily basis so Emeliefe can continue with his delusion. CBN can only be taken serious when they are ready to defend NAIRA with the fOREX Reserve and not with their MOUTH. |
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