Godwin Emefiele, CBN Governor |
Lukman Otunuga,
FXTM Research Analyst
Investors were caught completely off
guard this week after Nigeria’s President
Muhammadu Buhari reappointed the CBN governor, Godwin Emefiele, for a second term. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
Although the market reaction has been
somewhat mixed with the All-Share Index (ASI) edging -0.26% lower today, it is
too early to come to any conclusions about how this will impact domestic
markets moving forward. With the re-appointment of the CBN governor signaling
continuity and removing an element of uncertainty over policy direction, this
could be a welcome development for local shares and the Naira. However, more
time will be needed to carefully assess what this means for inflation, interest
rates and economic growth in the medium to longer term.
Stocks push higher as US tariffs kick in
Stock markets pushed higher on Friday,
despite the United States hiking tariffs on Chinese goods. It seems investors
are still cautiously optimistic over both sides finding a middle ground on
trade. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html If a trade deal becomes reality, this
is likely to boost global equities and emerging market assets. However, a
situation where talks descend into disagreements is likely to rekindle risk
aversion – ultimately boosting appetite for safe-haven assets.
Gold fights to defend $1280
Gold bulls fought incredibly hard to
keep prices above the $1280 support level this week, as uncertainty over
US-China trade talks supported the flight to safety. With escalating trade
tensions and renewed concerns over slowing global growth fueling risk aversion,
the precious metal punched above $1290 before later surrendering gains. We
expect Gold to transform into a battleground for bulls and bears in the week
ahead as conflicting market themes influence the precious metal. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html If the Dollar remains depressed and
heightened trade tensions encourage investors to stay clear of riskier assets,
Gold has the potential to shine towards $1300. However, a breakdown below $1280
is seen opening the gates towards $1265.
Commodity spotlight – WTI Oil
The story defining Oil’s valuation in
recent weeks continues to revolve around supply and demand-side factors. http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html On one side of the equation, Oil is
supported by OPEC-led supply cuts, the US ending sanction waivers on Iranian
Oil and supply disruptions in Venezuela and Libya. On the other side of the
equation, Oil is pressured by robust production from US Shale, rising crude
inventories and concerns over slowing growth impacting demand. Oil markets are
likely to remain volatile and highly sensitive ahead of the OPEC meeting in
June. In regards to the technical picture, WTI Oil is trading around $62.00 on
the daily charts. A weekly close above this level is seen opening a path
towards $63.00.
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