South Africa Market Review
- South African markets closed in the green on Friday, buoyed by gains in mining and banking sector stocks.
- Gold miners, Gold Fields (JO:GFIJ), AngloGold Ashanti (JO:ANGJ) and Harmony Gold Mining gained 4.5%, 4.2% and 2.2%, respectively.
- Platinum miners, Anglo American (JO:AMSJ) Platinum, Impala Platinum (JO:IMPJ) Holdings and Northam (JO:NHMJ) Platinum rose 2.3%, 1.8% and 0.6%, respectively.
- Further, banking firms, FirstRand (JO:FSRJ), Standard Bank (JO:SBKJ) Group and Nedbank Group (JO:NEDJ) advanced 2.3%, 1.5% and 0.9%, respectively.
- Sasol (JO:SOLJ) surged 14.0%.
- Tobacco company, British American Tobacco (JO:SNHJ) climbed 1.7%.
- The JSE All Share index advanced 0.8% to close at 68,271.19.
- The UK market finished weaker on Friday, amid a stronger pound. However, losses were capped by gains in banking sector stocks.
- London Stock Exchange Group (LON:LSEG) plunged 14.4% after the company stated that it was set to increase spending on its integration with Refinitiv in 2021.
- On the flipside, retailers, J Sainsbury (OTC:JSAIY), Tesco (LON:TSCO) and Wm.
- Morrison Supermarkets rose 3.1%, 2.1% and 1.8%, respectively.
- Banking firms, Standard Chartered (LON:STAN), Barclays (LON:BARC) and HSBC Holdings (LON:HSBA) gained 4.6%, 3.0% and 2.6%, respectively.
- The FTSE 100 index declined 0.3% to close at 6,630.52.
US Market Review
- US markets ended higher on Friday, as stronger-than-expected monthly jobs data bolstered investor sentiment.
- Chevron (NYSE:CVX) rose 4.3%, after the company entered an agreement to acquire the 33.92mn shares of Noble Midstream Partners (NASDAQ:NBLX).
- On the contrary, Norwegian Cruise Line Holdings (NYSE:NCLH) dropped 12.3%, after the company announced that it started a public offering of 47.58mn shares.
- Hibbett Sports (NASDAQ:HIBB) declined 3.9%, even after the company reported better than expected 4Q20 net income.
- The S&P 500 index rose 2.0% to settle at 3,841.94, while the DJIA index advanced 1.9% to close at 31,496.30.
- The NASDAQ index climbed 1.6% to end the trading session at 12,920.15.
Asia Market Review
- Asian markets are trading lower this morning.
- In Japan, banking firms, Mitsubishi UFJ Financial Group Inc (T:8306) and Sumitomo Mitsui Financial (T:8316) have risen 3.3% and 2.5%, respectively.
- In Hong Kong, Sunny Optical Technology Group (HK:2382) has plunged 5.3% and market heavyweight, Tencent Holdings (HK:0700) has shed 3.0%.
- In South Korea, Samsung Electronics (KS:005930) has dropped 0.1%.
- The Nikkei 225 index is trading 0.2% lower at 28,806.94.
- The Hang Seng index is trading 1.6% weaker to trade at 28,625.52, while the Kospi index is trading 0.4% lower at 3,015.11.
Commodities
- At 06:00 SAST today, Brent spot prices rose 1.7% to trade at $70.55/bl, after Yemen’s Houthi forces fired drones and missiles at the heart of Saudi Arabia’s oil industry over the weekend.
- On Friday, Brent spot prices rose 3.7% to settle at $69.39/bl, following a stronger-than-expected US jobs report and a decision by OPEC and its allies not to increase supply in April. Baker Hughes reported that the oil and gas rig count, rose by 1 to 403 for the week ended 5 March 2021.
- On Friday, the Illinois North Central No.2 Yellow corn spot prices fell 0% to $5.195/bushel.
- At 06:00 SAST today, gold prices advanced 0.3% to trade at $1,705.60/oz. On Friday, gold gained 0.2% to close at $1,700.64/oz, after the Federal Reserve (Fed) Chair Jerome Powell's remarks that the rise in yields was not disorderly sapped demand for the safe haven metal.
- On Friday, copper declined 0.2% to close at $8,913.20/mt. Aluminium closed 1.1% higher at $2,177.75/mt.
Currencies
- On Friday, the South African rand weakened against the US dollar. In the US, the economy created more jobs than expected in February as falling new COVID-19 infections and additional pandemic relief money from the government boosted hiring at restaurants and other services businesses. Unemployment rate fell in February. The trade deficit widened in January as goods imports jumped to a record high amid a sharp rebound in consumer spending.
- The yield on benchmark government bonds rose on Friday. The yield on 2026 bond rose to 7.57%. Further, the yield on 2023 bond advanced to 5.37% while that for the longer-dated 2030 issue rose to 9.29%.
- At 06:00 SAST, the US dollar is trading 0.1% higher against the South African rand at R15.3784, while the euro is trading marginally lower at R18.3005. At 06:00 SAST, the British pound has declined 0.2% against the South African rand to trade at R21.2381.
- On Friday, the euro declined against most of the major currencies. German factory orders rose more than expected in January as robust foreign demand more than offset domestic weakness in Europe’s largest economy.
- At 06:00 SAST, the euro slipped 0.1% against the US dollar to trade at $1.1901, while it has gained 0.1% against the British pound to trade at GBP0.8617.
Economic Updates
- The net gold & forex reserves eased to $51.58bn in South Africa, in February, compared with a reading of $51.99bn in the prior month.
- In South Africa, gross gold & forex reserve fell to a level of $53.79bn in February, compared with a reading of $54.80bn in the prior month.
- The Halifax house price index fell 0.1% in the UK on a monthly basis, in February. In the previous month, the Halifax house price index had recorded a drop of 0.3%.
- In Italy, the seasonally adjusted retail sales slid 3.0% on a monthly basis, in January. In the previous month, retail sales had registered a revised rise of 2.4%.
- Trade deficit in France widened to EUR4.00bn in January. France had registered a trade deficit of EUR3.60bn in the previous month.
- In January, the seasonally adjusted factory orders in Germany registered a rise of 1.4% on a MoM basis, more than market expectations for a rise of 0.7%. Factory orders had dropped by a revised 2.2% in the prior month.
- Unemployment rate dropped unexpectedly to a level of 6.2% in February, in the US, compared with market expectations of an unchanged reading of 6.3%. Unemployment rate had recorded a reading of 6.3% in the previous month.
- The US had registered a trade deficit of $68.20bn in January, from a trade deficit of $67.00bn in the prior month. Market anticipations were for a trade deficit of $67.50bn.
- In February, the labour force participation rate remained steady at a level of 61.4% in the US. In the previous month, the labour force participation rate had registered a similar level of 61.4%.
- Private payrolls in the US rose by 465.00K in February, compared with a revised advance of 90.00K jobs in the previous month.
Corporate Updates
South Africa
- Pick 'n Pay Stores Limited: The supermarket store announced that Richard van Rensburg will be retiring from his position as executive director of the company with effect from 31 March 2021.
- Mpact Limited (JO:MPTJ): The paper and plastics packaging company, in its FY20 results, indicated that its revenue from contracts with customers rose to R11.10bn from R11.08bn posted in the previous year. Its diluted EPS stood at 188.20c compared with loss per share of 443.20c in the last year.
- Nedbank Limited (JO:NEDJ): The banking company, in its FY20 trading update, stated that the company expects its HEPS to be between R10.42 and R11.72 compared with prior year and its EPS to be between 650.00c and 775.00c compared with the previous year.
- RMB Holdings Limited (JO:RMHJ): The banking firm, in its 1H21 trading update, stated that the company expects loss per share to be between 32.30c and 0.00c compared with EPS of 323.40c and headline loss per share to be between 32.50c and 0.00c compared with HEPS of 324.60c in the same period of last year.
- Covid-19 claims Absa (JO:ABGJ) deputy CEO Peter Matlare: Peter Matlare, Absa banking group’s deputy CEO and head of its Africa regional operations, died of Covid-19 complications on Sunday, making him the highest-profile business leader to succumb to the disease.
- Nedbank expects 2020 earnings to tumble: Nedbank, SA’s fourth biggest bank by assets and which counts the Public Investment Corporation (PIC) among its top shareholders, expects full-year profits to slide by up to 60.0% in the year to end-December 2020, largely reflecting the economic fallout of the Covid-19 pandemic.