Naira, Nigeria Stocks Fall as Oil Teams With Vote to Hit Outlook
The naira weakened a fourth day and Nigerian stocks fell to the lowest since April 2013 as sliding oil prices weighed on local assets with elections nine weeks away.
The currency fell 0.6 percent to 183.55 per dollar by 4:11 p.m. in Lagos, the commercial capital, the lowest on a closing basis since Dec. 1. Banks and manufacturers pushed the Nigerian Stock Exchange All Share Index (NGSEINDX) 0.4 percent lower to 32,932.49. In London, Brent futures fell a sixth day.
Foreign investors have become wary of Nigeria, which derives more than 90 percent of export earnings from oil, according to the Organization of the Petroleum Exporting Countries. They’ll probably stay cautious before the vote on Feb. 14, according to Lanre Buluro, head of research at Primera Africa Securities Ltd.
“In this market, everything is correlated to the oil price,” he said by phone from Lagos. “Some of the bearish sentiment will continue into next year, at least until after the elections are over.”
United Bank for Africa Plc, Nigeria’s third-largest lender, fell 4.9 percent to 4.51 naira. Union Bank of Nigeria Plc, Transnational Corp. of Nigeria Plc and Seplat Petroleum Development Co. each dropped 5 percent. Seven stocks rose, 40 decreased and 148 were unchanged.
While President Goodluck Jonathan is running unopposed for the nomination of his ruling People’s Democratic Party, the main opposition All Progressives Congress holds its primary tomorrow. If Muhammadu Buhari, a former military ruler, defeats ex-Vice President Atiku Abubakar, the APC’s prospects of defeating Jonathan are about 40 percent, Philippe de Pontet, New York-based Eurasia Group’s Africa director, said in an e-mailed note today.
To contact the reporter on this story: Paul Wallace in London at pwallace25@bloomberg.net
To contact the editors responsible for this story: Vernon Wessels at vwessels@bloomberg.net Emily Bowers
The currency fell 0.6 percent to 183.55 per dollar by 4:11 p.m. in Lagos, the commercial capital, the lowest on a closing basis since Dec. 1. Banks and manufacturers pushed the Nigerian Stock Exchange All Share Index (NGSEINDX) 0.4 percent lower to 32,932.49. In London, Brent futures fell a sixth day.
Foreign investors have become wary of Nigeria, which derives more than 90 percent of export earnings from oil, according to the Organization of the Petroleum Exporting Countries. They’ll probably stay cautious before the vote on Feb. 14, according to Lanre Buluro, head of research at Primera Africa Securities Ltd.
“In this market, everything is correlated to the oil price,” he said by phone from Lagos. “Some of the bearish sentiment will continue into next year, at least until after the elections are over.”
United Bank for Africa Plc, Nigeria’s third-largest lender, fell 4.9 percent to 4.51 naira. Union Bank of Nigeria Plc, Transnational Corp. of Nigeria Plc and Seplat Petroleum Development Co. each dropped 5 percent. Seven stocks rose, 40 decreased and 148 were unchanged.
While President Goodluck Jonathan is running unopposed for the nomination of his ruling People’s Democratic Party, the main opposition All Progressives Congress holds its primary tomorrow. If Muhammadu Buhari, a former military ruler, defeats ex-Vice President Atiku Abubakar, the APC’s prospects of defeating Jonathan are about 40 percent, Philippe de Pontet, New York-based Eurasia Group’s Africa director, said in an e-mailed note today.
To contact the reporter on this story: Paul Wallace in London at pwallace25@bloomberg.net
To contact the editors responsible for this story: Vernon Wessels at vwessels@bloomberg.net Emily Bowers
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