SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, boosted by gains in telecom and property sector stocks.
- Telecommunications companies, MTN Group (JO:MTNJ), Telkom SA SOC (JO:TKGJ) and Vodacom Group (JO:VODJ) jumped 3.9%, 3.3% and 1.0%, respectively.
- Property developers, Equites Property Fund (JO:EQUJ), MAS, Resilient REIT (JO:RESJ) and Growthpoint Properties (JO:GRTJ) advanced 3.2%, 2.1%, 1.5% and 1.1%, respectively.
- Retailers, Spar Group (JO:SPPJ), Shoprite Holdings (JO:SHPJ) and Pick ‘n Pay Stores (JO:PIKJ) gained 2.9%, 1.7% and 1.0%, respectively.
- Food companies, Famous Brands (JO:FBRJ) and Tiger Brands (JO:TBSJ) rose 1.7% and 1.1%, respectively.
- On the flipside, lenders, Nedbank Group (JO:NEDJ) and Standard Bank Group (JO:SBKJ) dropped 1.9% and 1.5%, respectively.
- The JSE All Share index advanced 0.3% to close at 82,146.81.
UK MARKET REVIEW
- The UK market finished weaker yesterday, led by losses in consumer staple and pharmaceutical sector stocks.
- Food processing company, Associated British Foods (LON:ABF) edged down 8.5%, after the company warned of a drop in Primark's like-for-like sales in second half of the year amid unfavourable weather in Britain and Ireland.
- Insurance companies, Admiral Group (LON:ADML) and Aviva (LON:AV) dropped 4.0% and 1.6%, respectively.
- On the other hand, housebuilding company, Vistry Group (LON:VTYV) surged 8.5%, after the company reported higher revenue in 1H24 and announced a GBP130.00m share buyback.
- Banking firms, Barclays (LON:BARC), Standard Chartered (LON:STAN), NatWest Group (LON:NWG) and Lloyds Banking Group (LON:LLOY) advanced 2.2%, 1.8%, 1.1% and 0.9%, respectively.
- The FTSE 100 index declined 0.3% to close at 8,241.71.
US MARKET REVIEW
- US markets ended mostly lower yesterday, as investors focused on domestic jobs data.
- Pharmaceutical companies, Eli Lilly (NYSE:LLY) and Amgen (NASDAQ:AMGN) dropped 3.6% and 1.9%, respectively.
- On the contrary, electric vehicle company, Tesla (NASDAQ:TSLA) advanced 4.9%, after the company announced plans to launch its full self-driving advanced driver assistance software in Europe and China in 1Q25, pending regulatory approval.
- Food companies, Hormel Foods Corporation (NYSE:HRL) and General Mills (NYSE:GIS) gained 3.6% and 1.3%, respectively.
- Airlines companies, United Airlines Holdings (NASDAQ:UAL), American Airlines Group (NASDAQ:AAL) and Southwest Airlines (NYSE:LUV) rose 2.2%, 1.6% and 1.0%, respectively.
- The S&P 500 index fell 0.3% to settle at 5,503.41, while the DJIA index declined 0.5% to close at 40,755.75.
- The NASDAQ index climbed 0.3% to end the trading session at 17,127.66.
ASIA MARKET REVIEW
- Asian markets are trading lower this morning, ahead of key US jobs data.
- In Japan, consumer electronics company, Hitachi (TYO:6501) has shed 3.8%.
- On the flipside, video game company, Konami Group Corporation (TYO:9766) has advanced 3.8%.
- In Hong Kong trading is halted today due to Super Typhoon Yagi.
- In South Korea, internet services company, Rakuten Group (TYO:4755) has dropped 5.6%.
- On the contrary, medical equipment company, Hancom Lifecare (KS:372910) has surged 14.3%.
- Yesterday, the Hang Seng index declined 0.1% to close at 17,444.30.
- Today, the Nikkei 225 index is trading 0.2% lower at 36,568.05, while the Kospi index is trading 0.9% lower at 2,551.88.
COMMODITIES
- At 05:30 SAST today, Brent prices marginally rose to trade at $72.70/bl.
- Yesterday, Brent prices marginally fell to settle at $72.69/bl, due to ongoing demand concerns in the US and China, coupled with the potential increase in supplies from Libya. Meanwhile, the US Energy Information Administration (EIA) reported that the US crude inventories fell by 6.87mn bls in the week ended 30 August 2024.
- At 05:30 SAST today, gold prices advanced 0.1% to trade at $2,517.59/oz. Yesterday, gold gained 0.8% to close at $2,516.32/oz, as a weaker greenback and a drop in the US treasury yields boosted demand for the safe haven yellow metal.
- Yesterday, copper rose 1.7% to close at $8,978.54/mt. Aluminium closed 0.6% lower at $2,381.35/mt.
CURRENCIES
- Yesterday, the South African rand strengthened against the US dollar. In the US, the ISM services PMI unexpectedly rose in August. Moreover, the ADP private sector employment rose in August. Meanwhile, the number of people filing for initial jobless claims fell in the week ended 30 August 2024.
- The yield on benchmark bonds were lower yesterday. The yield on the SA 10-year generic bond fell to 10.45%, while that for SA 20-year generic bond declined to 11.08%
- At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R17.7052, while the euro is trading slightly higher at R19.6779. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.3321.
- Yesterday, the euro mostly advanced against most of the major currencies. In Germany, factory orders unexpectedly rose in July, amid a surge in demand for transport equipment. In the eurozone, retail sales marginally rose in July, reflecting subdued boost from household consumption to economic growth.
- At 05:30 SAST, the euro marginally advanced against the US dollar to trade at $1.1114, while it has slightly gained against the British pound to trade at GBP0.8435.
ECONOMIC UPDATES
- In the UK, the S&P Global construction PMI declined to a level of 53.60 in August, more than market expectations for a drop to a level of 54.90. The S&P Global construction PMI had recorded a level of 55.30 in the previous month.
- In Switzerland, the unemployment rate remained unchanged at 2.5% on a MoM basis in August.
- In Germany, seasonally adjusted factory orders unexpectedly rose 2.9% on a MoM basis in July, compared to a revised rise of 4.6% recorded in the previous month.
- In the eurozone, retail sales rose 0.1% on a MoM basis in July, in line with market expectations. Retail sales had recorded a revised drop of 0.4% in the previous month.
- In the US, the ISM services PMI unexpectedly rose to a level of 51.50 in August, compared to a level of 51.40 recorded in the previous month.
- In the US, the S&P services PMI rose more than expected to a level of 55.70 in August, compared to a level of 55.00 recorded in the previous month.
- In the US, the ADP employment rose to 99.00K in August, less than market expectations and compared to a revised rise of 111.00K jobs in the previous month.
- In the US, initial jobless claims fell to a level of 227.00K in the week ended 30 August 2024, more than market expectations for a drop to a level of 230.00K. Initial jobless claims had recorded a revised level of 232.00K in the previous week.
CORPORATE UPDATES
SOUTH AFRICA
- Sanlam Limited (JO:SLMJ): The insurance company, in its 1H24 results, reported that revenue from insurance operations advanced 74.5% from the same period of the preceding year to R6.50bn. Its diluted EPS stood at 471.00c, compared with 382.70c recorded in the corresponding period of the previous year.
- Harmony Gold Mining Company Limited (JO:HARJ): The gold mining company, in its FY24 results, reported revenue of R61.38bn higher as compared with R49.28bn posted in the previous year. Its diluted EPS increased 75.5% from the prior year to 1,364.00c.
- OUTsurance Group Limited (JO:OUTJ): The insurance company, in its trading update for the year ended 30 June 2024, revealed that it expects EPS to be 32.0% to 42.0%, higher as compared with 190.30c recorded in the previous year. Also, it expects HEPS to be 14.0% to 24.0%, higher as compared with 189.20c recorded in the prior year. Moreover, the company intends to release its financial results for the year ended 30 June 2024 on 17 September 2024.
- Pan African Resources Plc (JO:PANJ): The mining company, in its trading update for the year ended 30 June 2024, revealed that its revenue increased by 16.8%, mainly due to the increase in gold sold of 4.9% combined with an increase in the average US$ gold price of 11.3%. It expects EPS to be 25.0% to 35.0%, higher as compared with 3.19 US cents recorded in the previous year. Also, it expects HEPS to be 27.0% to 37.0%, higher as compared with 3.15 US cents recorded in the previous year. Moreover, the company intends to release its results for the year ended 30 June 2024 on 11 September 2024.
- Oil inches higher on possible delay to OPEC+ supply hike: Oil prices edged up after plunging to multimonth lows previously as major producers may delay an output increase planned for October and US inventories fell, though the gains were limited by persistent demand concerns.