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Investors’ Confidence Returns In Developed Markets

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Sentiment toward stocks rose around the world, reaching a record level in the US, as reports on manufacturing showed the global economy is recovering and investors bet that profits grew for the first time since 2007.

Investors forecast gains in each of the nine countries represented in the Bloomberg Professional Confidence Survey for the first time since the data began in 2007. The sentiment measure for the Standard & Poor’s 500 Index climbed 35 per cent to 54.37.

That’s only the second time the reading exceeded 50, signaling participants anticipate a rally in the next six months. The responses from 4.101 Bloomberg users were gathered January 4-8 as the MSCI World Index added 2.6 per cent.

Rising factory output in the US China and Europe helped send the S & P 500 to six straight gains to begin the year.

Analysts estimate that fourth quarter earnings reports beginning this week will show S&P 500 profit rose 62 percent, according to data complied by Bloomberg.

The results will follow the biggest annual rally since 2003 for MSCI World Index of equities in 23 developed nations. “The market is clearly in an upside trend”, said Luis Benguerd, a trader at inter-brokers Espanola in Barcelona, Spain, who participated in the survey.

“As long as we keep getting these macro figures and companies do as good as analysts expect them to do, that’s enough to keep this trend going”

The MSCI World has rebounded 74 percent from a 13-year low in March after the Federal Reserve left its benchmark interest rate at almost zero and the US government lent, spent or guaranteed as much as $9.66 trillion to end the recession and unlock credit markets. 

US factory output expanded in December at the fastest pace in more than three years, according to a report from the Tempe, Arizona-based Institute for supply Management. Chinese manufacturing surged the most since April 2004 last month, data compiled by London-based H SBC Holdings Plc and Market Economics showed. Production increased for a third month in December, Markit said.

The three reports were released January 4. The Bloomberg Sentiment Indexes for the US, Japan and Spain rose above 50 and reached all-time highs. The U.K gauge topped 50 for the first time since October, while Switzerland climbed to a record.

Spain exceeded 50 for the first time, adding 17 percent to 51.41. Confidence in Switzerland climbed 3.6 per cent to 60.89 and U.K index surged 22 per cent to 55.61. The measures for Italy, France and Germany increased 14 per cent, 3.7 per cent and 2.4 per cent to 62.61, 57.77 and 53.33 respectively.

The Dow Jones Stoxx 600 Index of European equities may advance 9.2 per cent through the end of 2010 as the economy grows strategists at New York based Citigroup Inc wrote in a January 4 report. Signs that the global economy is rebounding from its first recession since World War II have helped push prices on the MSCI World to 34.7 times profit from the past year at its 1.656 companies. That’s the most expensive valuation since 2002, making equities vulnerable should earnings fail to materialise.

Alcoa Inc., the biggest US aluminium producer, began earnings season on January 11 by missing the average analyst profit forecast. The S&P 500 lost 0.9 per cent following the New York based company’s report.

“Alcoa’s bottom-line number was not good and investors are selling because expectations were high”, said Mark Bronzo, a money manager in Irvington, New York, at security global investors, which oversees $21 billion. “The fear gets heightened”.

The MSCI World fell 0.4 per cent on Wednesday morning in New York  on a decline in oil and concern the Federal Reserve is preparing markets for higher interest rates.

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CBN Opens N500 Grants Portal For Graduates, Undergraduates

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To reduce the level of suffering associated with unemployment in the country, the Central Bank of Nigeria (CBN) has developed grants of N500,000.00 for graduates and students.
A statement from the apex bank, made available to The Tide, said qualified persons have been directed to visit cbnties.com.ng portal for the CBN N500k grants registration.
This, according to the statement, is under the Tertiary Institution Entrepreneurship Scheme (TIES), in partnership with Nigerian Polytechnics and Universities to exploit the potential of graduate entrepreneurs in Nigeria.
CBN said the aim of TIES is to increase access to finance for Nigerian polytechnic and university graduates and graduates with innovative business and technological ideas.
The apex bank added that it is also to address the trend of white-collar job seekers and focus on job creation.
The statement quoted the CBN Governor, Godwin Emefiele, as saying that the scheme is designed to create a “paradigm shift from a ‘white-collar’ job search culture to an entrepreneurial culture to economic growth and job creation between undergraduates and graduates.
“As for the grant, CBN will allocate N500 million among the top five third best delivery organizations.
“The top five polytechnics and universities in Nigeria with the best entrepreneurial trends/ideas will be awarded first place: N150 million second place N120 million third place N80 million fourth place N80 million and fifth place. Location – N50 m illion”, it stated.
As part of the scheme, the CBN has announced that it will form a private and public sector expert organization (BoE) for two-year regional and national entrepreneurship competitions to assess the entrepreneurial and technological innovations offered by Nigerian polytechnics and universities.
BoE will also recommend high-potential projects and the variable impact on the award of the grant.
Projects funded under the scheme will be monitored by independent monitors set up jointly by CBN and MFIs.

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Economic Growth, Determining Factor For Policies In 2023  – Stockbrokers

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Chairman of Research and Technology at the Chartered Institute of Stockbrokers (CIS), Mr. Akeem Oyewale, has said that economic growth and development should be the determining factor in policies ahead of 2023.
Oyewale, who said this recently at the institute’s Annual National Economic Review and Outlook 2022 webinar  in Lagos, urged policy makers to act in a spirit of justice and tolerance to avoid acts that could lead to violence in the run-up to the 2023.
Speaking on the topic: “Global Dynamics Shaping Nigeria‘s Economic Future”, Oyewale listed factors such as the process leading up to the 2023 general elections, the response to Omicron, and the effects of COVID-19, as what would also determine the growth of the nation’s economic development.
He used the fora to urge the Federal Government to intensify its engagement with Nigeria’s capital market to better smoothly finance the 2022 budget deficit without increasing borrowing.
Oyewale also directed the Central Bank of Nigeria (CBN) to fully consider the effects on the capital market when making monetary and fiscal policies.
According to him, the philosophy of building an economy led by the private sector enshrined in the National Development Plan must be strictly adhered to.
On the need for new listings, Oyewale said Nigeria National Petroleum Company’s trading should continue with the public listing of its shares on the stock market.
This, he explained, would give Nigerians the opportunity to co-own one of the country’s commanding heights.
“The CBN and banks should grant trading facilities to securities trading firms in the country to maintain optimism in the capital market”, he said.
Speaking further, he urged pension funds and other institutional investors to increase their investment in the stock market to create much-needed stability and encourage new investment.
Earlier, President of the CIS Council, Mr Olatunde Amolegbe,  said the institute would continue with initiatives that would enhance its growth and development in 2022.
Amolegbe stated that CIS would undertake activities that would promote capital market literacy in all geopolitical zones of the country, saying that he would strengthen collaboration with international professional bodies such as CISI UK and others for the benefit of their members.
He continued that the institute was working to increase the number of Nigerian universities offering graduate and undergraduate courses in securities and investment/capital market studies.
“Our vision by 2023 is to see the Securities and Investments profession registered in the hearts of young Nigerian academics as their preferred career path and CIS as the model to be followed by other professional bodies,” he concluded.

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PenCom Completes Review Of Pension Reform Act 2014

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The regulatory body of the Nigerian Pension Industry, the National Pension Commission (PenCom) says it has deliberated on the review of the Pension Reform Act 2014 (PRA 2014).
This was contained in a statement to newsmen signed by Peter Aghahowa, Head, Corporate Communications of PenCom, who disclosed that the regulator organised the retreat on the review of PRA 2014 in Abuja between January 12 and 14.
According to Aghahowa, the retreat was aimed at identifying salient issues to be reviewed in the PRA 2014 as a prelude to advancing legislative action on the bill.
Aghahowa said it is expected that the National Assembly would subsequently organise a public hearing to provide an avenue for stakeholders to formally make input into the proposed amendments.
He also said that the PRA 2014 was enacted following a review of the initial PRA of 2004, which introduced legal and institutional frameworks of the Contributory Pension Scheme (CPS) and established PenCom to regulate and supervise all pension matters in Nigeria.
According to him, the Director-General of PenCom, Aisha Dahir-Umar, during the opening ceremony of the retreat, had informed the participants that the PRA 2014 codified one of the most important socio-economic reform initiatives of the Federal Government.
He continued that she said this has brought about a pension industry that has accumulated pension assets in excess of N13 trillion invested in various aspects of the Nigerian economy.
He quoted her as saying that “the review is a corollary to some implementation challenges encountered with certain sections of the Act not long after its enactment in July 2014.
“This was also an addition to persistent calls from stakeholders for the amendment of some sections of the Act, which resulted in several legislative initiatives through the sponsorship of Bills for amendment of the PRA 2014 by the National Assembly.
“Consequently, the Commission as the regulator of the pension industry, decided to coordinate and harmonize the various efforts in order to achieve a comprehensive and constructive exercise for the review of PRA 2014”, he concluded.

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