Naira gains N8 at parallel market

The Naira appreciated by N8 in the last one week at the parallel market.

This was as the equities market recorded major gains of N777.9 billion as oil prices picked up.

The All Share Index (ASI) grew by N778 billion to N14.9 trillion at the close of business last week as investors saw opportunities in crude oil upbeat and new push to stabilise the global oil market.

Brent rebounded to $43.21/barrel from previous week’s close of $40.65/barrel, despite rising COVID-19 cases.

The benchmark stock index, ASI, soared past 13 per cent in the past month, and is also the best-performing market in the world as at last Tuesday and is currently on the longest winning run since July 2017 as local and foreign investors continue to hunt for higher yields.

The naira and equities market rebound came after Organisation of the Petroleum Exporting Countries (OPEC) and its allies agreed to ensure that proactive and preemptive measures are taken to support the global oil market.

OPEC’s 2020 World Oil Outlook showed that the pandemic may prove the tipping point for peak oil demand as it predicted that global oil demand will grow at relatively healthy rates during the first part of the forecast period before demand plateaus during the second half.

But the external reserves remained pressured as they decreased five basis points week-on-week to $35.7 billion on October 7, data from the Central Bank of Nigeria (CBN) showed.

At the official window, the CBN spot rate remained unchanged at N379 to a dollar while the parallel market rate strengthened by N8 week-on-week to N457 to a dollar.