Market Review, Commodities, Currencies, Economic & Corporate Update - 03.07.24

Published 2024/07/03, 08:29
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SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the red yesterday, primarily driven by losses in telecommunications and insurance sector stocks.
  • Telecommunications companies, Telkom SA SOC (JO:TKGJ), MTN Group (JO:MTNJ) and Blue Label Telecoms (JO:BLUJ) plunged 5.2%, 4.0% and 2.2%, respectively.
  • Insurance companies, Old Mutual (JO:OMUJ), Santam (JO:SNTJ), Discovery and Sanlam (JO:SLMJ) dropped 3.6%, 3.4%, 1.8% and 1.4%, respectively.
  • Retail companies, Spar Group (JO:SPPJ), Woolworths Holdings (JO:WHLJ), Cashbuild (JO:CSBJ), Truworths International (JO:TRUJ), Pepkor Holdings (JO:PPHJ) and Foschini Group (JO:TFGJ) declined 3.5%, 3.4%, 3.0%, 2.8%, 2.5% and 2.3%, respectively.
  • On the flipside, gold miners, Harmony Gold Mining Co. (JO:HARJ), AngloGold Ashanti (JO:ANGJ) and Gold Fields (JO:GFIJ) advanced 2.8%, 2.6% and 1.2%, respectively.
  • The JSE All Share index closed 0.5% lower at 79,435.12.

UK MARKET REVIEW

  • The UK market closed weaker yesterday in cautious trading ahead of parliamentary elections.
  • Insurance company, Beazley (LON:BEZG) shed 5.2%, due to concerns over the potential impact of Hurricane Beryl on insurers.
  • Retailer, J Sainsbury (LON:SBRY) declined 2.9%, after reporting a slowdown in first-quarter like-for-like sales growth.
  • Pharmaceutical company, GSK (LON:GSK) eased 1.5%, following a Delaware judge judgement to allow over 70,000 lawsuits to proceed, alleging that the heartburn drug Zantac caused cancer.
  • On the contrary, energy company, BP (LON:BP) advanced 1.3%, amid surge in oil prices to a two-month high on expectations of rising fuel demand for the summer travel season.
  • The FTSE 100 index declined 0.6% to close at 8,121.20.

US MARKET REVIEW

  • US markets closed higher yesterday, driven by gains in Tesla and positive comments from Federal Reserve chair Jerome Powell on the economic outlook.
  • Electric vehicle maker, Tesla (NASDAQ:TSLA) jumped 10.2%, after reporting better than expected second quarter deliveries.
  • Media company, Paramount Global (NASDAQ:PARA) gained 7.8%, following reports of potential merger of its Paramount+ streaming platform, with an existing platform.
  • The S&P 500 index rose 0.6% to settle at 5,509.01, while the DJIA index advanced 0.4% to close at 39,331.85.
  • The NASDAQ index climbed 0.8% to end the trading session at 18,028.76.

ASIA MARKET REVIEW

  • Asian markets are trading higher this morning, tracking overnight gains on Wall Street.
  • In Japan, video game company, NEXON Co. (TYO:3659) has added 4.7%, while financial services company, Chiba Bank (TYO:8331) has dropped 2.6%.
  • In Hong Kong, semiconductor manufacturing company, Semiconductor Manufacturing International Corporation (HK:0981) has jumped 2.7%.
  • On the flipside, electrical appliance manufacturing company, Haier Smart Home Co. (HK:6690) has shed 1.6%.
  • In South Korea, logistics company, Hyundai Glovis Co. (KS:086280) has advanced 6.9%.
  • On the contrary, construction services company, STX Heavy Industries Co. (KS:071970) has shed 6.8%.
  • The Nikkei 225 index is trading 0.9% higher at 40,425.37.
  • The Hang Seng index has advanced 0.6% to trade at 17,879.44, while the Kospi index is trading 0.4% higher at 2,791.47.

COMMODITIES

  • At 05:30 SAST today, Brent prices rose 0.6% to trade at $86.73/bl, following a reduction in crude oil inventories. The American Petroleum Institute (API) reported a decrease of 9.16mn barrels in US crude oil inventories for the week ended 28 June 2024.
  • Yesterday, Brent prices fell 0.4% to settle at $86.24/bl, as concerns about Hurricane Beryl disrupting supplies eased. The storm is expected to miss most oil fields as it moves towards Jamaica.
  • At 05:30 SAST today, gold prices marginally declined to trade at $2,329.31/oz. Yesterday, gold declined 0.1% to close at $2,330.32/oz, due to a rise in US Treasury yields which reduced demand for the safe haven metal.
  • Yesterday, copper rose 0.7% to close at $9,546.10/mt. Aluminium closed 0.3% higher at $2,522.80/mt.

CURRENCIES

  • Yesterday, the South African rand weakened against the US dollar. In the US, job openings rose in May. Additionally, Fed Chair Jerome Powell stated that the inflation is back on disinflationary path, but more data is required before considering cutting rates.
  • The yield on benchmark government bonds declined yesterday. The yield on the 2030 bond fell to 9.88%, while that for the longer-dated 2040 issue eased to 11.92%.
  • At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R18.6024, while the euro is trading marginally higher at R19.9857. At 05:30 SAST, the British pound has marginally gained against the South African rand to trade at R23.5977.
  • Yesterday, the euro mostly advanced against most of the major currencies. In the eurozone, consumer price inflation slowed in June. The employment rate remained at a record low in May.
  • At 05:30 SAST, the euro marginally slipped against the US dollar to trade at $1.0744, while it has marginally weakened against the British pound to trade at GBP0.8471.

ECONOMIC UPDATES

  • In Italy, the unemployment rate fell to 6.8% in May, down from 6.9% recorded in the prior month.
  • In the eurozone, the preliminary consumer price index (CPI) climbed 0.2% on a MoM basis in June mirroring the rise in previuos month.
  • In the eurozone, the unemployment rate remained unchanged at 6.4% in May, in line with market expectations.
  • In the US, the JOLTs job openings registered an unexpected rise to a level of 8.14mn in May, surpassing market expectations and compared to a revised 7.92mn jobs in the prior month.
  • In Canada, the manufacturing PMI unexpectedly remained unchanged at a level of 49.30 in June, compared to a similar rise in the prior month.
  • In Australia, the AiG construction PMI improved to a level of -23.20 in June, compared to a level of -68.10 in the previous month.
  • In Australia, the AiG manufacturing PMI advanced to a level of -26.50 in June, compared to a level of -31.10 in the previous month.
  • In Australia, the Judo Bank services PMI unexpectedly climbed to a level of 51.20 in June, compared to a level of 52.50 recorded in the prior month.
  • In Japan, the Jibun Bank services PMI declined more than expected to a level of 49.40 in June, compared to a level of 53.80 recorded in the previous month.
  • In China, the services PMI unexpectedly dropped to a level of 51.20 in June. In the prior month, the services PMI had recorded a level of 54.00.

CORPORATE UPDATES

SOUTH AFRICA

  • MultiChoice (JO:MCGJ) investors wary about competition for sports rights: MultiChoice shareholders are concerned about the pay-TV group’s ability to hang on to crucial sports rights, which have allowed it to stand out amid growing competition and keep customers on its platforms.
  • MC Mining (JO:MCZJ) announces changes to its board: MC Mining announced that non-executive directors Andrew Mifflin and Julian Hoskin have resigned from the board, effective 30 June.

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