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JSE Closes Lower as Attention Turns to SONA

Published 2024/02/08, 08:20
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The local bourse ended 0.33% lower on Wednesday, as investors continued to reassess their expectations for a rate cut by the US Federal Reserve (Fed) at the next policy meeting in March. Today, the focus will shift to President Cyril Ramaphosa's State of the Nation Address (SONA). “The annual address will allow Ramaphosa to speak on the general state of the nation and reflect on a wide range of political, economic and social matters in the domestic and global spheres, according to parliament. The president is also expected to account for the work of the government and set out its programme of action during this joint sitting of parliament,” Business Day reported. The rand continued to strengthen, trading at R18.90 at 19h00.

US stocks rallied on Wednesday as traders evaluated another round of corporate earnings. Trading Economics reported that “Ford (NYSE:F) gained 3.2% on posting upbeat full-year guidance. Roblox (NYSE:RBLX) surged by 10.2% after the video game company reported losses less than estimates. Conversely, Amgen (NASDAQ:AMGN) lost 6.4% as its results failed to impress investors. U.S.-listed shares of Alibaba (NYSE:BABA) declined 5.9% following the company's fiscal third-quarter revenue missed analysts' estimates.” The S&P 500 added 0.80% for the day, hitting a fresh record high while the Dow Jones and the Nasdaq gained 0.40% and 0.90% respectively.

After a turbulent session, European stocks ended lower, giving up gains from yesterday as investors continued to look for clues about the trajectory of global financial conditions. Trading Economics reported that TotalEnergies (EPA:TTEF), the Eurozone's largest energy producer fell by 3.20% after posting a 31% drop in fourth-quarter adjusted net income, despite the decision to hike its dividend by 7.10%. In addition, “Germany’s government, through the state-owned KfW bank, initiated the placement of 50 million shares of its holding in Deutsche Post (ETR:DHLn), aiming to raise funds in line with the agreements outlined in the 2024 budget. As a result, its shares fell by 4.80%,” Trading Economics reported.

Asian markets climbed on Wednesday, with mainland stocks rebounding for the second day in a row, as Beijing reportedly ramped up measures to support equity markets. Bloomberg reported that “President Xi Jinping will discuss challenges in the stock market with regulators, while China’s securities regulator also vowed to prevent abnormal market fluctuations and crack down on vicious short selling. Moreover, state fund Central Huijin Investments pledged to expand ETF purchases to support equities.”

Commodities ended in positive territory. Brent crude oil strengthened to $79.31 a barrel while gold followed suit at $2 040 an ounce at 18h00.

PSG Wealth Daily Investment Update, 8 February 2024

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