SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, as investors assessed comments from the US Federal Reserve (Fed) officials, indicating a cautious approach to potential interest rate cuts.
- Food companies, Tiger Brands (JO:TBSJ), RFG Holdings (JO:RFGJ) and Famous Brands (JO:FBRJ) advanced 3.6%, 1.9% and 1.6%, respectively.
- Lenders, Absa Group (JO:ABGJ), Nedbank Group (JO:NEDJ) and FirstRand (JO:FSRJ) gained 3.6%, 1.5% and 1.1%, respectively.
- Telecommunications companies, MTN Group (JO:MTNJ), Vodacom Group (JO:VODJ) and Telkom SA SOC (JO:TKGJ) rose 2.5%, 1.9% and 1.3%, respectively.
- Pharmaceutical companies, Aspen Pharmacare Holdings (JO:APNJ), Netcare (JO:NTCJ) and Life Healthcare Group (JO:LHCJ) added 2.2%, 2.0% and 1.7%, respectively.
- On the flipside, diversified miners, Exxaro Resources (JO:EXXJ), Anglo American (LON:AAL) and Kumba Iron Ore (JO:KIOJ) dropped 2.8%, 2.2% and 1.2%, respectively.
- The JSE All Share index advanced 0.6% to close at 86,314.50.
UK MARKET REVIEW
- The UK market finished weaker yesterday, amid losses in pharmaceutical stocks and as investors assessed domestic economic data and Bank of England (BoE) Governor Andrew Bailey's cautious tone on rate cuts.
- Pharmaceutical company, AstraZeneca (LON:AZN) dropped 2.9%, after the company appointed Iskra Reic as its new international Executive Vice President.
- Energy utilities companies, National Grid (LON:NG), SSE (LON:SSE) and Centrica (LON:CNA) declined 1.5%, 1.3% and 1.2%, respectively.
- On the other hand, insurance company, Legal & General Group (LON:LGEN) jumped 6.0%, after the company revealed plans to return capital to shareholders and was on track to meet its financial targets.
- Homebuilders, Persimmon (LON:PSN) and Taylor Wimpey (LON:TW) advanced 2.3% and 1.2%, respectively.
- The FTSE 100 index declined 0.3% to close at 8,335.81.
US MARKET REVIEW
- US markets ended higher yesterday, boosted by gains in technology sector stocks and optimistic comments from Federal Reserve Chair Jerome Powell about the economy's strength.
- Technology company, Salesforce (NYSE:CRM) surged 11.0%, after the company reported better than expected revenue in 3Q24 and raised its annual revenue forecast.
- Peers, Nvidia Corporation (NASDAQ:NVDA), International Business Machines (NYSE:IBM) and Microsoft Corporation (NASDAQ:MSFT) advanced 3.5%, 2.0% and 1.4%, respectively.
- On the contrary, homebuilders, Lennar Corporation (NYSE:LEN), Pulte Group (NYSE:PHM) and D.R. Horton (NYSE:DHI) dropped 3.6%, 3.5% and 3.3%, respectively.
- The S&P 500 index rose 0.6% to settle at 6,086.49, while the DJIA index advanced 0.7% to close at 45,014.04.
- The NASDAQ index climbed 1.3% to end the trading session at 19,735.12.
ASIA MARKET REVIEW
- Asian markets are trading mostly lower this morning, as investors assess the impact South Korea’s political crisis following a brief imposition of martial law by President Yoon Suk Yeol.
- In Japan, mechatronic products company, Advantest (TYO:6857) Corporation has advanced 3.4%.
- On the flipside, automobile company, Yamaha Corporation (TYO:7951) has declined 2.4%.
- In Hong Kong, real estate company, Longfor Group Holdings (HK:0960) has shed 3.1%.
- On the ither hand, consumer electronics company, Xiaomi Corporation (HK:1810) has added 0.9%.
- In South Korea, port unloading and logistics company, Intergis (KS:129260) has plunged 11.0%.
- On the contrary, pharmaceutical company, Samil Pharmaceuticals (KS:000520) has surged 17.7%.
- The Nikkei 225 index is trading 0.5% higher at 39,488.51.
- The Hang Seng index has declined 1.2% to trade at 19,511.39, while the Kospi index is trading 0.4% lower at 2,454.88.
COMMODITIES
- At 05:30 SAST today, Brent prices marginally fell to trade at $72.3/bl.
- Yesterday, Brent prices fell 1.8% to settle at $72.31/bl, as investors await OPEC+ decision on production cuts. Meanwhile, the US Energy Information Administration (EIA) reported that the US crude inventories fell by 5.07mn bls in the week ended 29 November 2024.
- At 05:30 SAST today, gold prices declined 0.1% to trade at $2,648.10/oz. Yesterday, gold gained 0.2% to close at $2,649.79/oz, following jump in the US private payrolls data.
- Yesterday, copper declined 0.4% to close at $8,969.82/mt. Aluminium closed 1.3% higher at $2,640.35/mt.
CURRENCIES
- Yesterday, the South African rand weakened against the US dollar. In the US, the ADP private sector employment increased by slightly less than expected in November. Moreover, the the ISM services PMI declined more than expected in November.
- The yield on benchmark bonds rose yesterday. The yield on the SA 10-year generic bond climbed to 10.22%, while that for SA 20-year generic bond rose to 11.02%.
- At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R18.1608, while the euro is trading slightly higher at R19.1094. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.0782.
- Yesterday, the euro mostly advanced against most of the major currencies. In the eurozone, the the HCOB services PMI contracted less than expected in November. Moreover, the producer price index (PPI) declined in October. European Central Bank (ECB) President Christine Lagarde highlighted uncertainty in the euro area’s medium-term outlook, with short-term weak growth and a temporary rise in inflation. In the UK, service sector grew at its slowest pace in a year in November, with business activity and new orders increasing at weaker rates.
- At 05:30 SAST, the euro advanced 0.1% against the US dollar to trade at $1.0522, while it has slightly gained against the British pound to trade at GBP0.8281.
ECONOMIC UPDATES
- In the UK, the S&P Global services PMI dropped to a level of 50.80 in November, less than market expectations for a drop to a level of 50.00. The services PMI had recorded a level of 52.00 in the prior month.
- In Spain, the HCOB services PMI fell to a level of 53.10 in November, more than market expectations for a drop to a level of 53.80. The HCOB services PMI had recorded a level of 54.90 in the prior month.
- In Italy, the HCOB services PMI declined to a level of 49.20 in November, more than market expectations for a drop to a level of 51.60. The HCOB services PMI had recorded a level of 52.40 in the prior month.
- In France, the HCOB services PMI dropped to a level of 46.90 in November, less than market expectations for a drop to a level of 45.70. The HCOB services PMI had recorded a level of 49.20 in the prior month.
- In Germany, the HCOB services PMI fell more than market expectations to a level of 49.30 in November. The HCOB services PMI had recorded a level of 51.60 in the prior month.
- In the eurozone, the HCOB services PMI eased to a level of 49.50 in November, less than market expectations for a drop to a level of 49.20. The HCOB services PMI had recorded a level of 51.60 in the prior month.
- In the eurozone, the producer price index (PPI) rose 0.4% on a MoM basis in October, in line with market expectations. The PPI had recorded a drop of 0.6% in the previous month.
- ECB President Christine Lagarde highlighted uncertainty in the euro area’s medium-term outlook, with short-term weak growth and a temporary rise in inflation.
- In the US, the MBA mortgage applications rose 2.8% in the week ended 29 November 2024, compared to a rise of 6.3% recorded in the previous week.
- In the US, the ADP employment rose by 146.00K in November, less than market expectations and compared to a revised rise of 184.00K jobs in the previous month.
- In the US, the S&P Global services PMI unexpectedly declined to a level of 56.10 in November, compared to a level of 55.00 recorded in the previous month.
- In the US, the ISM services PMI fell to a level of 52.10 in November, more than market expectations for a fall to a level of 55.50. The ISM services PMI had recorded a level of 56.00 in the prior month.
CORPORATE UPDATES
SOUTH AFRICA
- Tiger Brands Limited (JO:TBSJ): The food company, in its FY24 results, reported that total revenue advanced 0.7% from the preceding year to R37.66bn. Its diluted EPS stood at 1,915.80c, compared with 1,700.00c recorded in the previous year.
- MAS Plc (JO:MSPJ): The real estate investment trust company, in its voluntary pre-close trading update for the six months ending 31 December 2024, reported strong operational and financial performance in Central and Eastern Europe (CEE). The company achieved a 7.0% YoY increase in both footfall and tenant sales per square meter across its retail properties. Open-air malls outperformed, showing an 8.0% rise, while enclosed malls reported a steady 3.0% increase as compared with the previous year. Moreover, occupancy rates of Central and Eastern European retail assets remained robust at 97.4%, with collection rates at an impressive 99.7% for the four-month period ending 31 October 2024.
- Super Group Limited (JO:SPGJ): The logistics and mobility solutions company announced the sale of its 53.584% stake in SG Fleet to Westmann Bidco, controlled by Pacific Equity Partners, for A$641.40mn. The transaction, at A$3.50 per share, offers a 31% premium to SG Fleet’s pre-announcement share price. The deal is subject to approvals and expected to close by March 2025.