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Stears unveils 2024 Africa outlook

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….predicts lingering economic challenges in Nigeria, Kenya,

Stears, a leading economic analysis and data-driven insights provider, has unveiled its much-anticipated 2024 African Outlook Report, delivering nuanced insights into the continent’s economic landscape. Contrary to broad generalisations, the report sheds light on the diverse growth trajectories across Africa, with East Africa emerging as a regional powerhouse.

In 2024, Africa’s overall growth is forecasted at 4.0%, a notable increase from 3.3% in 2023, positioning it as the second-highest globally, trailing only Asia (4.8%). East Africa takes centre stage in this growth narrative, exhibiting consistently higher growth rates than the rest of the continent. Rwanda, Tanzania, Uganda, and Kenya are identified as key drivers, collectively contributing significantly to the region’s economic resurgence.

“East Africa’s growth is propelled by dynamic sectors such as natural resources, transportation, tourism, and agriculture. Significantly, there is potential for further acceleration due to increased investment from Gulf countries. These developments are shaping East Africa into a model region for economic resilience and diversification,” says Fadekemi Abiru, Head of Insights at Stears. Notably, South Africa, Egypt, and Nigeria, considered economic giants, are poised for growth rates below the regional average, emphasising the importance of recognising and navigating the diverse economic landscapes that exist within the continent.

Stears’ 2024 Outlook further delves into key African countries, specifically Kenya and Nigeria, projecting persisting economic challenges for both nations. The macroeconomic analysis for Kenya anticipates persistent currency depreciation and inflationary pressures.  The 2024 Africa Outlook Report highlights that inflation averaged 7.8% in 2023, with a nuanced forecast ranging between 6% and 7.4% for 2024. This aligns with the Central Bank of Kenya’s (CBK) target range of 5±2.5%, reflecting a global trend targeting enhanced price stability.

Dumebi Oluwole, Senior Economist at Stears, underscores the significance of inflation as a barometer of economic health and advocates for the urgent need to address the persistent challenge of currency depreciation. The report reveals a closer alignment of the Kenyan Shilling (KES) to its fair value, shedding light on the delicate balance between inflation dynamics and investor attractiveness.

Nevertheless, Kenya’s GDP per capita stands 30% above the Sub-Saharan Africa average, signalling increased consumer spending and positioning the country as a significant market. The report, however, highlights the potential for further GDP per capita growth, primarily through improved job creation in high-value sectors like manufacturing and services.

Simultaneously, the 2024 African Outlook Report delves into Nigeria’s macroeconomic landscape, revealing a formidable challenge in the form of a high headline inflation rate, currently at 28.2%. Stears projects an average annual inflation rate ranging from 27.59% to 31.85% for 2024, necessitating proactive measures for economic stability.

Dumebi Oluwole explains, “The elimination of petrol subsidies has significantly heightened the cost of living for consumers, leading to an overall uptick in inflation. Coupled with the devaluation of the naira, this has precipitated higher exchange rates, complicating the economic landscape for both consumers and businesses.”

Stears emphasises the need for strategic interventions to enhance liquidity and stabilise the exchange rate, highlighting the importance of collaborative initiatives between the government, regulatory bodies, and the private sector for sustained economic growth.

Yvette Dimiri, Director at Stears, articulates the vision behind the report, stating, “Our 2024 African Outlook Report reflects Stears’ commitment to providing data-driven insights that transcend conventional narratives. As Africa navigates its course in the global economic landscape, understanding distinctive growth trajectories and leveraging regional strengths will be key.”

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NGX: Sell-offs in banking stocks drop value of transactions down 2.60%

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Bearish sentiment persisted on banking stocks at the equity market on Friday, making the value of transactions traded on the floor of the Nigerian Exchange Ltd.(NGX) down by 2.60 per cent.

Analysis of the market activities indicated trade turnover settled lower relative to the previous session.
Specifically, investors transacted a total of 257.86 million shares valued at N5.40 billion exchanged in 7,168 deals, as against 285.91 million shares worth N5.54 billion exchange in 7,726 deals posted on Thursday.
Consequently, the market capitalisation, which opened at N56.469 trillion, shed N173 billion or 0.31 per cent to close at N56.296 trillion.
The All-Share Index also dropped 0.31 per cent or 306 points to settle at 99,539.75, compared to 99,845.91 recorded in the previous session.
As a result, the Year-To-Date (YTD) return dipped to 33.12 per cent.
Sell-offs in Guaranty Trust Holding Company (GTCO), FBN Holdings, Zenith Bank,  Access Corporation,  Stanbic IBTC Bank, Jaiz Bank, as well as United Capital and Unilever Nigeria, among other top decliners, drove the market to a negative terrain.
Meanwhile, market breadth closed negative with 20 losers and 14 gainers.
On the losers’ chart, United Bank led by 10 per cent to close at N1.62, FBN Holdings followed by 9.83 per cent to close at N24.30, Tantalizers declined by 8.57 per cent to close at 32k per share.
Deap Capital Management shed 7.35 per cent to close at 63k and Caverton went down by 6.83 per cent to close at 1.50 per share.
On the gainers’ chart, FTN Cocoa Processors led by 9.60 per cent to close at N1.37, RT Briscoe trailed by 9.26 per cent to close at 59k, Livestock Feed gained N1.45 per share.
Royal Exchange Assurance added 8.06 per cent to close at 67k, while Consolidated Hallmark Plc rose by 7.44 per cent to close at N1.30 per share.
On the activity chart, UBA led in volume with 38.72 million shares traded in value of N888.55 million, while GTCO led in value with 38.30 million shares worth N1.31 biliion.
Access Corporation also sold 34.34 million shares worth N584.54 million, Zenith Bank traded 24.41 million shares worth N875.85 million and The Initiative Plc transacted 17.52 million shares worth N34.13 million.
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Financial expert seeks alignment of FG’s fiscal policy with CBN’s monetary policy

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A financial expert, Mr Eddie Osarenkhoe, has advised the Federal Government to align its fiscal policy with the Central Bank of Nigeria’s monetary policy to achieve economic stability.

Osarenkhoe, the immediate past President of Finance Houses Association of Nigeria (FHAN), gave the advice while speaking with newsmen on Wednesday in Ota, Ogun.

He attributed the current steady appreciation of the naira to CBN’s reforms and the country’s ability to pay some of its debts.

Osarenkhoe applauded the CBN reforms which, he said, had helped to sustain the steady appreciation of the naira against the dollar.

The financial expert stated that CBN was able to check speculators in the foreign exchange, thus resulting in continuous appreciation of the nation’s currency.

“If the federal government is able to come up with fiscal policy in alignment with that of CBN, it will help the nation’s economy a great deal,” he said.

According to him, the economy needs to improve through exports to enable the country to earn more foreign exchange.

The naira has shown a remarkable strength against the US dollar, trading below N1,000 at the official market.

This development has been attributed to the strategic financial policies being implemented by the President Bola Tinubu-led administration and CBN.

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Investors lose N457bn as bearish sentiment continues

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Investors in the Nigerian equities market lost N457 billion at the end of trading on Wednesday.

This followed the dip in the share value of Livestock Feeds, Computer Warehouse Group, International Energy Insurance, and FTN Cocoa Processors on the trading floor today.

After five hours of trading at the capital market, the equity capitalisation crashed to N56.5 trillion from N56.9 trillion posted by the bourse on Tuesday.

Similarly, the All-Share Index (ASI) fell below the 100,000-mark to 99,908.89 from 100,717.21 achieved by the bourse the previous day.

The market breadth was negative as 17 stocks advanced, 26 declined, while 78 others remained unchanged in 9, 074 deals.

Ikeja Hotel topped the gainers’ list with +10.00 percent to close at N7.26 from its previous N6.60 per share.

Fidelity Bank, Academy, Morison, and Prestige also increased their share prices by 9.88 percent, 9.77 percent, 9.71 percent, and 9.26 percent respectively.

On the flip side, Livestock Feeds, Computer Warehouse Group, International Energy Insurance, and FTN Cocoa Processors led other price decliners as they shed 10.00 percent, 9.79 percent, 9.79 percent and 9.72  percent each off their share prices.

UBA recorded the highest volume by trading 55.013 million shares valued at N1.28 billion in 1,092 deals followed by Zenith Bank with 47.029 million shares worth N1.69 billion traded by investors in 907 deals.

Access Corp traded 44.986 million shares valued at N789 million in 845 deals.

On the value index, Zenith Bank recorded the highest value for the day trading stocks worth N1.69 billion in 907 deals followed by UBA which traded equities worth N1.284bn in 1,092 deals.

Access Corp traded stocks worth N789 million in 845 deals.

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