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Market Review, Commodities, Currencies, Economic & Corporate Update - 06.05.24

Published 2024/05/06, 08:41
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SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the green on Friday, encouraged by US jobs data were more favorable than predicted.
  • Diversified miners, Kumba Iron Ore (JO:KIOJ), African Rainbow Minerals (JO:ARIJ), Exxaro Resources (JO:EXXJ) and Anglo American (JO:AGLJ) increased 4.4%, 3.0%, 1.7% and 0.9%, respectively.
  • Platinum miners, Anglo American Platinum (JO:AMSJ) and Impala Platinum Holdings (JO:IMPJ) gained 4.2% and 2.2%, respectively. Healthcare companies,
  • Netcare, Life Healthcare Group Holdings (JO:LHCJ) and Aspen Pharmacare Holdings (JO:APNJ) surged 3.3%, 1.5% and 0.5%, respectively.
  • Retailers, Cie Financiere Richemont S.A. (JO:CFRJ), Mr Price Group (JO:MRPJ), Spar Group (JO:SPPJ) and Woolworths Holdings (JO:WHLJ) jumped 3.0%, 2.1%, 1.7% and 1.0%, respectively.
  • Telecommunications companies, Vodacom Group (JO:VODJ) and MTN Group (JO:MTNJ) advanced 1.8% and 1.2%, respectively.
  • The JSE All Share index added 0.5% to close at 76,428.33.

UK MARKET REVIEW

  • The UK market finished firmer on Friday, amid gains in homebuilding sector stocks.
  • Insurance companies, Phoenix Group Holdings (LON:PHNX), Prudential (LON:PRU) and St. James's Place (LON:SJP) jumped 6.5%, 3.8% and 3.0%, respectively.
  • Berkeley Group Holdings (LON:BKGH), Persimmon (LON:PSN), Taylor Wimpey (LON:TW) and Barratt Developments (LON:BDEV) surged 5.0%, 4.7%, 4.1% and 4.0%, respectively.
  • Mining company, Anglo American (LON:AAL) grew by 1.2%, amid reports that Glencore (LON:GLEN) (JO:GLNJ) was considering a bid for the company, subsequent to its rejection of an initial proposal from BHP.
  • Packaging company, Mondi (LON:MNDI) advanced 0.6%, after the company posted a robust trading update for 1Q24.
  • On the flipside, travel and leisure company, InterContinental Hotels Group (LON:IHG) eased 2.1%, after the company reported a significant dip in revenue per available room (RevPAR) growth in the 1Q24.
  • The FTSE 100 index gained 0.5% to close at 8,213.49.

US MARKET REVIEW

  • US markets ended substantially higher on Friday, as weaker than anticipated employment data raised rate cut hopes from the Federal Reserve.
  • Biotechnology company, Amgen (NASDAQ:AMGN) soared by 11.8%, after the company reported positive interim data on its experimental weight-loss drug MariTide and first-quarter earnings.
  • Technology company, Apple (NASDAQ:AAPL) advanced 6.0%, after the company reported a record $110.00bn share buyback program and projected higher than expected fiscal third-quarter sales.
  • Travel company, Expedia (NASDAQ:EXPE) edged down 15.3%, after the group slashed its annual revenue growth forecast.
  • The S&P 500 index gained 1.3% to settle at 5,127.79, while the DJIA index advanced 1.2% to close at 38,675.68.
  • The NASDAQ index climbed 2.0% to end the trading session at 16,156.33.

ASIA MARKET REVIEW

  • Asian markets are trading mostly higher this morning, driven by expectations of rate cuts by the US Federal Reserve.
  • In Japan, markets are closed today on account of a market holiday.
  • In Hong Kong, glass company, Xinyi Glass Holdings (HK:0868) has gained 8.9%.
  • On the flipside, energy company, CNOOC (HK:0883) has shed 3.1%.
  • In South Korea, markets are closed today on account of a market holiday.
  • On Thursday, the Nikkei 225 index eased 0.1% to close at 38,236.07, while on Friday, the Kospi index declined 0.3% to close at 2,676.63.
  • Today, the Hang Seng index has advanced 0.2% to trade at 18,512.99.

COMMODITIES

  • At 05:30 SAST today, Brent prices rose 0.2% to trade at $83.12/bl, after Saudi Arabia hiked June crude prices for most regions and amid the easing prospects of a Gaza ceasefire deal.
  • On Friday, Brent prices fell 0.8% to settle at $82.96/bl, amid weaker than expected US jobs data raised rate cut hopes. Meanwhile, Saudi Arabia and its allies in OPEC+ are likely to keep oil production unchanged for a further three months.
  • At 05:30 SAST today, gold prices advanced 0.4% to trade at $2,310.29/oz. On Friday, gold declined 0.1% to close at $2,301.89/oz.
  • On Friday, copper rose 1.0% to close at $9,737.00/mt. Aluminium closed 0.1% lower at $2,535.65/mt.

CURRENCIES

  • On Friday, the South African rand weakened against the US dollar. In the US, nonfarm payroll rose less than expected in April. Meanwhile, service sector activity unexpectedly contracted in April, for the first time since December 2022.
  • The yield on benchmark government bonds fell on Friday. The yield on the 2030 bond fell to 10.87%, while that for the longer-dated 2040 issue marginally eased to 13.10%.
  • At 05:30 SAST, the US dollar is trading 0.1% higher against the South African rand at R18.5333, while the euro is trading 0.1% higher at R19.9488. At 05:30 SAST, the British pound has gained 0.1% against the South African rand to trade at R23.2529.
  • On Friday, the euro mostly advanced against most of the major currencies. In the eurozone, the unemployment rate remained unchanged at a record low for a fifth consecutive month in March. In the UK, the services PMI expanded for a sixth consecutive month in April.
  • At 05:30 SAST, the euro advanced 0% against the US dollar to trade at $1.0765, while it has weakened 0% against the British pound to trade at GBP0.8580.

ECONOMIC UPDATES

  • In the UK, the S&P Global services PMI rose to a level of 55.00 in April, more than market expectations for a rise to a level of 54.90. The S&P Global services PMI had recorded a level of 53.10 in the previous month.
  • In Italy, the unemployment rate unexpectedly eased to 7.2% in March, compared to a revised reading of 7.4% in the previous month.
  • In the eurozone, the unemployment rate remained unchanged at 6.5% in March, in line with market expectations.
  • In the US, nonfarm payrolls rose by 175.00K in April, less than market expectations for a rise by 243.00K. Nonfarm payrolls had recorded a revised rise of 315.00k jobs in the prior month.
  • In the US, the unemployment rate unexpectedly rose to 3.9% in April, compared to 3.8% recorded in the previous month.
  • In the US, the S&P Global services PMI declined to a level of 51.30 in April, less than market expectations for a drop to a level of 50.90. The S&P Global services PMI had recorded a level of 51.70 in the prior month.
  • In the US, the ISM services PMI unexpectedly eased to a level of 49.40 in April, compared to a level of 51.40 recorded in the previous month.

CORPORATE UPDATES

SOUTH AFRICA

  • Netcare Limited (JO:NTCJ): The pharmaceutical company, in its trading update for the six months ended 31 March 2024, revealed that revenue increased between 4.2% to 4.4%, as compared with the previous year. Moreover, it has achieved normalised group EBITDA growth of between 7.3% to 7.7%, demonstrating operating leverage. Meanwhile, total paid patient days (PPDs) decreased by 0.8% compared to the prior period. Also, occupancy in the acute hospitals declined slightly to 62.1%. The company intends to publish its unaudited interim group results on or about 20 May 2024.
  • Exxon (NYSE:XOM) merger with Pioneer will deliver results within 18-24 months: Exxon Mobil will take 18-24 months to achieve its full production synergies from its $60bn purchase of US shale oil producer Pioneer Natural Resources (NYSE:PXD), the company’s top shale executive said.

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