SOUTH AFRICA MARKET REVIEW
- South African markets closed in the red on Friday, amid concerns over a potential recession in the US and geopolitical tension weighed on investor sentiment.
- Packaging companies, Sappi (JO:SAPJ) and Mondi (JO:MNPJ) plunged 7.0% and 6.0%, respectively.
- Gold miners, Gold Fields (JO:GFIJ), Harmony Gold Mining Company (JO:HARJ) and Sibanye Stillwater (JO:SSWJ) dropped 3.1%, 2.7% and 2.0%, respectively.
- Diversified miner, Kumba Iron Ore (JO:KIOJ), Anglo American (JO:AGLJ) and African Rainbow Minerals (JO:ARIJ) shed 2.9%, 2.6% and 2.5%, respectively.
- Retailers, Shoprite Holdings (JO:SHPJ), Spar Group (JO:SPPJ) and Cashbuild (JO:CSBJ) declined 2.6%, 1.9% and 1.8%, respectively.
- Insurance companies, Sanlam (JO:SLMJ) and Discovery Holdings (JO:DSYJ) fell 2.5% and 2.0%, respectively.
- The JSE All Share index declined 1.6% to close at 80,538.57.
UK MARKET REVIEW
- The UK market finished weaker on Friday, led by losses in commodity-linked stocks and as weak US economic data spurred a global risk-off sentiment.
- Retailers, JD Sports Fashion (LON:JD), Burberry Group (LON:BRBY) and Marks & Spencer Group (LON:MKS) plunged 6.6%, 4.9% and 4.3%, respectively.
- Banking firms, Barclays (LON:BARC), Standard Chartered (LON:STAN), NatWest Group (LON:NWG) and HSBC Holdings (LON:HSBA) dropped 6.2%, 4.5%, 3.8% and 3.4%, respectively.
- Insurance companies, Prudential (LON:PRU), Legal & General Group (LON:LGEN), Aviva (LON:AV) and Admiral Group (LON:ADML) shed 3.3%, 2.6%, 2.5% and 1.1%, respectively.
- On the other hand, travel and leisure company, International Consolidated Airlines Group SA (LON:ICAG) advanced 4.7%. after the company reported jump in its interim profits and terminated its proposed takeover of Air Europa.
- The FTSE 100 index declined 1.3% to close at 8,174.71.
US MARKET REVIEW
- US markets ended lower on Friday, as disappointing jobs data heightened fears of a potential recession.
- Semiconductor chips companies, Intel Corporation (NASDAQ:INTC), Microchip Technology (NASDAQ:MCHP) and Micron Technology (NASDAQ:MU) plunged 26.1%, 10.6% and 8.7%, respectively.
- Financial services companies, American Express (NYSE:AXP), Goldman Sachs (NYSE:GS) and JPMorgan Chase (NYSE:JPM) dropped 6.6%, 5.9% and 4.2%, respectively.
- Technology companies, Salesforce (NYSE:CRM), Microsoft Corporation (NASDAQ:MSFT) and Cisco Systems (NASDAQ:CSCO) shed 3.6%, 2.1% and 1.5%, respectively.
- On the contrary, restaurant chain company, McDonald’s Corporation (NYSE:MCD) and Starbucks Corporation (NASDAQ:SBUX) advanced 3.0% and 1.0%, respectively.
- The S&P 500 index fell 1.8% to settle at 5,346.56, while the DJIA index declined 1.5% to close at 39,737.26.
- The NASDAQ index eased 2.4% to end the trading session at 16,776.16.
ASIA MARKET REVIEW
- Asian markets are trading lower this morning, amid a wide sell-off.
- In Japan, banking and financial services company, Resona Holdings (TYO:8308) has slumped 12.3%.
- On the flipside, pharmaceutical company, Sumitomo Pharma (TYO:4506) has added 1.1%.
- In Hong Kong, consumer electronics company, Xiaomi Corporation (HK:1810) has shed 3.0%.
- On the other hand, real estate company, Henderson Land Development (OTC:HLDCY) has advanced 3.0%.
- In South Korea, infrastructure support services company, Doosan Corporation (KS:000157) has plunged 10.3%.
- On the contrary, fashion garments company, SG Corporation has jumped 5.2%.
- The Nikkei 225 index is trading 4.6% lower at 34,247.56.
- The Hang Seng index has declined 0.6% to trade at 16,842.52, while the Kospi index is trading 6.2% lower at 2,511.23.
COMMODITIES
- At 05:30 SAST today, Brent prices rose 1% to trade at $77.56/bl.
- On Friday, Brent prices fell 3.4% to settle at $76.81/bl, amid rising demand concerns following disappointing US jobs data and weaker Chinese economic data. Additionally, the Baker Hughes reported that the US oil rigs count remained unchanged at 482 in the week ended 2 August 2024.
- At 05:30 SAST today, gold prices advanced 0.1% to trade at $2,444.52/oz. On Friday, gold declined 0.1% to close at $2,443.29/oz, due to profit-taking.
- On Friday, copper declined 0.2% to close at $8,976.85/mt. Aluminium closed 0.9% lower at $2,276.07/mt.
CURRENCIES
- On Friday, the South African rand weakened against the US dollar. In the US, the non-farm payrolls increased by much less than expected July. Meanwhile, the unemployment rate jumped to a three-year high in July, amid a significant slowdown in hiring.
- The yield on benchmark government bonds fell on Friday. The yield on the 2030 bond fell to 9.20%, while that for the longer-dated 2040 issue declined to 11.39%.
- At 05:30 SAST, the US dollar is trading 0.4% higher against the South African rand at R18.3384, while the euro is trading 0.5% higher at R20.0332. At 05:30 SAST, the British pound has gained 0.3% against the South African rand to trade at R23.4731.
- On Friday, the euro advanced against most of the major currencies.
- At 05:30 SAST, the euro advanced 0.1% against the US dollar to trade at $1.0926, while it has gained 0.1% against the British pound to trade at GBP0.8534.
ECONOMIC UPDATES
- In Switzerland, the consumer price index (CPI) dropped 0.2% on a MoM basis in July, in line with market expectations. The CPI had recorded a flat reading in the previous month.
- In Switzerland, the SVME PMI fell to a level of 43.50 in July, more than market expectations for a drop to a level of 43.80. The SVME PMI had recorded a level of 43.90 in the previous month.
- In Italy, seasonally adjusted retail sales unexpectedly declined 0.2% on a MoM basis in June, compared to a rise of 0.4% recorded in the previous month.
- In the US, non-farm payrolls rose to a level of 114.00K in July, less than market expectations and compared to a revised rise of 179.00K in the previous month.
- In the US, the unemployment rate unexpectedly rose to 4.3% in July, compared to 4.1% recorded in the previous month.
- In Japan, the Jibun Bank services PMI unexpectedly declined to a level of 53.70 in July, compared to a level of 49.40 recorded in the previous month.
- In China, the Caixin services PMI rose to a level of 52.10 in July, more than market expectations for a rise to a level of 51.40. The services PMI had recorded a level of 51.20 in the prior month.
- In Australia, the Judo Bank services PMI dropped to a level of 50.40 in July, more than market expectations and compared to a level of 51.20 recorded in the prior month.
CORPORATE UPDATES
SOUTH AFRICA
- Curro Holdings Limited (JO:COHJ): The independent school network company, in its 1H24 trading update, stated that it expects EPS to be 15.1% to 25.7%, higher as compared with 33.40c recorded in the previous year. It expects HEPS to be 10.9% to 23.1%, higher as compared with 34.60c recorded in the previous year. Moreover, the company intends to publish its results for the six months ended 30 June 2024 on 21 August 2024.
- Oil on track for weekly decline amid demand worries: Oil prices rose but were set for a fourth successive weekly fall, as signs of disappointing global fuel demand growth outweighed the fear of supply disruptions.