South Africa Market Review
- South African markets closed in the red on Friday, pulled down by losses in banking and platinum mining sector stocks and as inflation fears weighed on global investor sentiment.
- Banking companies, Investec, Nedbank Group (JO:NEDJ) and Standard Bank Group (JO:SBKJ) declined 7.5%, 3.0% and 1.5%, respectively.
- Platinum miners, Northam Platinum (JO:NHMJ), Royal Bafokeng Platinum (JO:RBPCBe) and Anglo American Platinum (JO:AMSJ) dropped 3.9%, 3.0% and 0.6%, respectively.
- On the other hand, gold miners, Gold Fields (JO:GFIJ) and AngloGold Ashanti (JO:ANGJ) rose 2.0% and 0.3%, respectively.
- The JSE All Share index declined 1.2% to close at 65,911.27.
- The UK market finished firmer yesterday, on account of a weaker pound.
- Meanwhile, worries about a third COVID-19 wave in Europe were escalated by news that German Chancellor, Angela Merkel has recommended a four-week lockdown extension in the country.
- Kingfisher (LON:KGF) rose 3.6%, as the company reinstated its dividend, after it reported soaring FY20 profits as well as a strong start to the new fiscal year on higher demand.
- AstraZeneca (LON:AZN) added 3.3%, after it announced that a US trial of the coronavirus vaccine that it has developed with the University of Oxford showed that it is 79.0% effective at preventing symptomatic COVID-19 and 100.0% effective at preventing severe disease and hospitalisation.
- The FTSE 100 index advanced 0.3% to close at 6,726.10.
US Market Review
- US markets ended higher yesterday, buoyed by gains in technology sector stocks.
- Intel (NASDAQ:INTC), Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) rose 2.9%, 2.8% and 2.5%, respectively. Kansas City Southern (NYSE:KSU) jumped 11.1%, after Canadian Pacific Railway (NYSE:CP) agreed to acquire the railroad operator in a $25.00bn cash-and-stock deal in order to create the first railway spanning the US, Mexico and Canada.
- Tesla (NASDAQ:TSLA) added 2.3%. Starbucks (NASDAQ:SBUX) rose 1.2%, after the company announced that it would halve water usage in its supply chain by 2030.
- The S&P 500 index rose 0.7% to settle at 3,940.59, while the DJIA index advance 0.3% to close at 32,731.20.
- The NASDAQ index climbed 1.2% to end the trading session at 13,377.54.
Asia Market Review
- Asian markets are trading weaker this morning.
- In Japan, Japan Exchange Group has risen 2.4%, after the operator of the Tokyo Stock Exchange raised its FY20 net profit forecast to JPY51.50bn.
- On the other hand, Mitsubishi UFJ Financial Group (T:8306) and Sumitomo Mitsui Financial Group (NYSE:SMFG) have dropped 2.7% and 1.8%, respectively.
- In Hong Kong, oil company, CNOOC (HK:0883) has shed 1.9%.
- In South Korea, technology company, Samsung Electronics (KS:005930) has added 0.1%. The Nikkei 225 index is trading marginally lower at 29,164.66.
- The Hang Seng index is trading 1.3% weaker to trade at 28,509.88, while the Kospi index is trading 0.6% lower at 3,017.78.
Commodities
- At 06:00 SAST today, Brent spot prices fell 0.4% to trade at $63.44/bl, on concerns that new COVID-19 pandemic curbs and slow vaccine rollouts in Europe will hinder a recovery in global fuel oil demand.
- Yesterday, Brent spot prices fell 0.7% to settle at $63.69/bl, as prices remained under pressure as new European coronavirus lockdowns made a quick recovery look less likely. Meanwhile, Baker Hughes reported that the number of active US oil drilling rigs rose by 9 to 318 for the week ended 19 March.
- Yesterday, the Illinois North Central No.2 Yellow corn spot prices rose 0.7% to $5.36/bushel.
- At 06:00 SAST today, gold prices declined 0.2% to trade at $1,735.98/oz. Yesterday, gold declined 0.4% to close at $1,739.03/oz, as gains in US equity markets sapped demand for the safe haven metal.
- Yesterday, copper rose 0.5% to close at $9,116.25/mt. Aluminium closed 0.4% higher at $2,243.00/mt.
Currencies
- Yesterday, the South African rand weakened against the US dollar. In the US, the Federal Reserve (Fed) Chairman, Jerome Powell stated that the US economy has improved, crediting the Congress and the central bank for providing “unprecedented” support. However, he warned that the recovery is still far from complete. On the data front, existing home sales fell more than expected in February, as cold weather blanketed many parts of the country, and a rebound could be muted by rising mortgage rates as well as higher house prices amid tight supply.
- The yield on benchmark government bonds mostly fell on Friday. The yield on 2026 bond fell to 7.34%. Further, the yield on 2023 bond advanced to 5.38%, while that for the longer-dated 2030 issue fell to 9.31%.
- At 06:00 SAST, the US dollar is trading 0.4% higher against the South African rand at R14.7722, while the euro is trading 0.3% higher at R17.6254. At 06:00 SAST, the British pound has gained 0.2% against the South African rand to trade at R20.4573.
- Yesterday, the euro advanced against most of the major currencies. The German Bundesbank stated that the German economy is likely to shrink sharply this quarter, as pandemic-fighting curbs hit the services sector and even the booming construction industry slows.
- At 06:00 SAST, the euro marginally slipped against the US dollar to trade at $1.1931, while it has gained 0.1% against the British pound to trade at GBP0.8616.
Economic Updates
- The eurozone had posted the seasonally adjusted current account surplus of EUR30.50bn in January, following a current account surplus of EUR36.70bn in the previous month.
- The Chicago Fed national activity index dropped to -1.09 in February, in the US. The Chicago Fed national activity index had recorded a reading of 0.66 in the previous month.
- In February, existing home sales in the US slid 6.6% on a MoM basis, higher than market expectations of a fall of 3.0%. In the prior month, existing home sales had registered a revised rise of 0.2%.
- In Japan, the final coincident index rose to a level of 90.30 in January, compared to a revised reading of 87.40 in the previous month. The preliminary figures had indicated an advance to 91.70. Market expectations were for the coincident index to advance to a level of 91.70.
Corporate Upadtes
South Africa
- Northam Platinum Limited (JO:NHMJ): The platinum mining company, in its 1H21 results, revealed that its revenue advanced from the same period of the preceding year to R11.88bn. Its diluted EPS stood at 531.00c, compared with 328.00c recorded in the corresponding period of the previous year.
- RMB Holdings Limited (JO:RMHJ): The banking company, in its 1H21 results, stated that its revenue decreased to R48.00mn from R286.00mn posted in the corresponding period of the previous year. Its diluted loss per share stood at 3.20c compared with 12.50c in the same period of the prior year.