South Africa Market Review
- South African markets closed in the green yesterday, as investors await US inflation data.
- Paper and packaging companies, Sappi (JO:SAPJ), Nampak (JO:NPKJ) and Mondi (LON:MNDI) jumped 7.8%, 4.5% and 1.5%, respectively.
- Retailers, Cashbuild (JO:CSBJ), Shoprite Holdings (JO:SHPJ) and Cie Financiere Richemont (JO:CFRJ) S.A. climbed 5.6%, 1.1% and 0.5%, respectively.
- Real estate companies, Fortress REIT (JO:FFAJ), Emira Property Fund (JO:EMIJ) and NEPI Rockcastle N.V. (JO:NRPJ) advanced 4.3%, 1.7% and 1.6%, respectively.
- Diversified miners, Pan African Resources (JO:PANJ) and African Rainbow Minerals (JO:ARIJ) gained 2.5% and 2.1%, respectively.
- Gold miners, Gold Fields (JO:GFIJ) and Harmony Gold Mining Company (JO:HARJ) advanced 1.1% and 0.9%, respectively.
- On the flipside, telecommunication companies, Telkom SA SOC (JO:TKGJ) and Vodacom Group (JO:VODJ) declined 5.6% and 0.9%, respectively.
- The JSE All Share index advanced 0.1% to close at 77,013.75.
UK Market Review
- The UK market finished lower yesterday, as weaker Chinese demand weighed on mining sector stocks.
- Miners, Anglo American (LON:AAL), Glencore (LON:GLEN) and Rio Tinto (LON:RIO) shed 1.9%, 1.4% and 0.9%, respectively, amid drop in metal prices.
- Telecommunication companies, BT Group (LON:BT) and Vodafone Group (LON:VOD) both eased 1.3%.
- Oil companies, BP (LON:BP) and Shell (LON:RDSa) dropped 0.7% and 0.5%, respectively.
- On the other hand, aerospace companies, Rolls-Royce Holdings (LON:RR) and BAE Systems (LON:BAES) advanced 1.5% and 1.4%, respectively.
- Banks, HSBC Holdings (LON:HSBA), NatWest (LON:NWG) and Standard Chartered (LON:STAN) advanced 1.2%, 1.1% and 0.7%, respectively.
- Travel and leisure companies, Whitbread (LON:WTB) and InterContinental Hotels Group (LON:IHG) added 0.9% and 0.8%, respectively.
- The FTSE 100 index declined 0.1% to close at 7,554.49.
US Market Review
- US markets ended higher yesterday, ahead of the US inflation data and corporate results.
- Berkshire Hathaway (NYSE:BRKa) gained 3.6%, after the company reported record profits in the second quarter supported by its investment portfolio and insurance business.
- On the contrary, food company, Tyson Foods (NYSE:TSN) shed 3.8% after the company reported dismal 3Q23 results amid weaker prices and demand.
- Further, the company is closing four chicken processing plants to lower costs.
- Campbell Soup Company (NYSE:CPB) dropped 1.8%, after the company agreed to acquire Sovos Brands for $2.70bn.
- The S&P 500 index rose 0.9% to settle at 4,518.44, while the DJIA index advanced 1.2% to close at 35,473.13.
- The NASDAQ index added 0.6% to end the trading session at 13,994.40.
Asia Market Review
- Asian markets are trading mostly lower this morning, ahead of China’s inflation data.
- In Japan, transport company, Kawasaki Kisen Kaisha (TYO:9107) has climbed 4.6%.
- On the flipside, advertising company, CyberAgent (TYO:4751) has declined 2.5%.
- In Hong Kong, e-commerce company JD.com (HK:9618) has dropped 3.5%.
- On the contrary, energy company, CNOOC (HK:0883) has advanced 1.3%.
- In South Korea, electronics company, Samsung Electronics (KS:005930) has eased 0.9%.
- On the other hand, automotive parts company, Wooshin Systems (KS:017370) has added 0.8%.
- The Nikkei 225 index is trading 0.3% higher at 32,358.10.
- The Hang Seng index has declined 0.9% to trade at 19,353.79, while the Kospi index is trading 0.1% lower at 2,577.75.
Commodities
- At 05:30 SAST today, Brent prices rose 0.2% to trade at $85.55/bl, on supply concerns.
- Yesterday, Brent prices fell 1.0% to settle at $85.34/bl, due to drop in global demand.
- At 05:30 SAST today, gold prices declined 0.1% to trade at $1,934.61/oz. Yesterday, gold declined 0.3% to close at $1,936.39/oz, as a stronger greenback and higher Treasury yields reduced demand for the safe haven yellow metal.
- Yesterday, copper rose 0.5% to close at $8,494.70/mt. Aluminium closed marginally lower at $2,231.59/mt.
Currencies
- Yesterday, the South African rand weakened against the US dollar. US Federal Reserve Governor, Michelle Bowman said that the highest interest rates in 22 years likely aren't high enough and she expects to raise interest rates despite cooler reports on jobs and inflation recently.
- The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 8.95%. Further, the yield on the longer-dated 2030 issue declined to 10.25%.
- At 05:30 SAST, the US dollar is trading 0.4% higher against the South African rand at R18.7746, while the euro is trading 0.3% higher at R20.6313. At 05:30 SAST, the British pound has gained 0.2% against the South African rand to trade at R23.9592.
- Yesterday, the euro declined against most of the major currencies. In Germany, industrial production dropped more than expected in June.
- At 05:30 SAST, the euro slipped 0.1% against the US dollar to trade at $1.0989, while it has marginally gained against the British pound to trade at GBP0.8613.
Economic Updates
- In the UK, the BRC like-for-like retail sales rose 1.8% on a YoY basis in July, compared to a rise of 4.2% recorded in the previous month.
- In the UK, the Halifax house prices dropped 0.3% on a MoM basis in July, compared to a drop of 0.1% recorded in the previous month.
- In Switzerland, the unemployment rate remained unchanged at 1.9% in July, in line with market expectations.
- In Germany, seasonally adjusted industrial production fell 1.5% on a MoM basis in June, more than market expectations and compared to a revised drop of 0.1% recorded in the previous month.
- In the eurozone, the Sentix investor confidence index unexpectedly rose to a level of -18.90 in August, compared to a level of -22.50 recorded in the previous month.
- In the US, consumer credit increased by $17.85 billion in June, compared to $7.24 billion recorded in the prior month.
- In Japan, trade balance (BOP basis) recorded a surplus of JPY328.70bn in June, compared to a deficit of JPY1,186.70bn recorded in the prior month.
- In China, trade surplus widened to $80.60bn in July, compared to a surplus of $70.62bn in the previous month.
- In Australia, the Westpac consumer confidence index dropped 0.4% in August, compared to a rise of 2.7% recorded in the previous month.
Corporate Updates
South Africa
- Impala Platinum Holdings Limited (JO:IMPJ): The platinum mining company, in its production and trading update for the year ended 30 June 2023, revealed that gross group 6E production increased 2.0% from the previous year to 3.25mn 6E ounces. Gross refined and saleable volumes declined by 4% to 2.96mn 6E ounces. Meanwhile, sales volumes declined by 6.0% to 2.97mn 6E ounces. Further, the company intends to release its audited results for the year ended 30 June 2023 on or about 31 August 2023.
- Pan African Resources Plc (JO:PANJ): The mining company, in its FY23 operational update, revealed that its annual gold production stood at 175,209oz. For FY24, the company expects production to be between 178,000oz to 190,000oz. The company intends to release its annual results on 13 September 2023.
- Oil hovers near highest level since mid-April: Oil prices hovered near their highest levels since mid-April after top producers Saudi Arabia and Russia pledged to extend supply cuts through September, further tightening supplies.