Market Review, Commodities, Currencies, Economic & Corporate Update - 09.05.24

  • Market Overview

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the green yesterday, boosted by gains in retail sector stocks.
  • Retailers, Pick ‘n Pay Stores (JO: PIKJ ), SPAR Group (JO: SPPJ ), Foschini Group (JO: TFGJ ) and Cie Financiere Richemont S.A. (JO: CFRJ ) advanced 4.2%, 2.2%, 1.1% and 0.9%, respectively.
  • Pharmaceutical companies, Life Healthcare Group (JO: LHCJ ), Adcock Ingram Holdings (JO: AIPJ ) and Netcare (JO: NTCJ ) gained 2.1%, 1.1% and 0.7%, respectively.
  • Gold miners, AngloGold Ashanti (JO: ANGJ ), Harmony Gold Mining (JO: HARJ ) and Gold Fields (JO: GFIJ ) rose 1.8%, 1.7% and 0.9%, respectively.
  • Property builders, Burstone Group (JO: BTNJ ), Equites Property Fund (JO: EQUJ ) and Redefine Properties (JO: RDFJ ) added 1.8%, 1.3% and 0.8%, respectively.
  • On the flipside, telecommunications companies, Telkom SA SOC (JO: TKGJ ) and Vodacom Group (JO: VODJ ) shed 2.2% and 0.9%, respectively.
  • The JSE All Share index advanced 0.3% to close at 77,177.44.

UK MARKET REVIEW

  • The UK market finished firmer yesterday, following robust corporate results and ahead of the Bank of England's (BoE) interest rate decision.
  • Insurance companies, Prudential (LON: PRU ), Admiral Group (LON: ADML ) and Legal & General Group (LON: LGEN ) advanced 2.3%, 1.2% and 0.6%, respectively.
  • Publishing company, Informa (LON: INF ) gained 2.3%, after the company projected higher annual revenue and adjusted operating profit and also increased its share buyback programme.
  • Retailers, Marks & Spencer Group (LON: MKS ), B&M European Value Retail SA (LON: BMEB ) and J Sainsbury (LON: SBRY ) rose 1.9%, 1.5% and 1.3%, respectively.
  • Pharmaceutical company, AstraZeneca (LON: AZN ) gained 1.2%, after the company announced the worldwide withdrawal of its COVID-19 vaccine amid surplus of available updated vaccines since the pandemic.
  • The FTSE 100 index advanced 0.5% to close at 8,354.05.

US MARKET REVIEW

  • US markets ended mostly lower yesterday, as investors await US Federal Reserve’s (Fed) monetary policy decision.
  • Transportation company, Uber Technologies (NYSE: UBER ) dropped 5.7%, after the company issued lower than expected gross bookings in 2Q24.
  • Technology company, Intel (NASDAQ: INTC ) declined 2.2%, as the company flagged a possible sales hit amid export restrictions on Chinese orders.
  • On the contrary, financial services companies, JPMorgan Chase (NYSE: JPM ), Wells Fargo & Company (NYSE: WFC ), Citigroup (NYSE: C ) and Goldman Sachs Group (NYSE: GS ) advanced 2.0%, 1.6%, 1.2% and 0.7%, respectively.
  • The S&P 500 index marginally fell to settle at 5,187.67, while the DJIA index advanced 0.4% to close at 39,056.39.
  • The NASDAQ index eased 0.2% to end the trading session at 16,302.76.

ASIA MARKET REVIEW

  • Asian markets are trading mostly higher this morning.
  • In Japan, pharmaceutical company, Sumitomo Pharma (TYO: 4506 ) has advanced 3.0%.
  • On the flipside, automobile company, Mitsubishi Motors (TYO: 7211 ) has dropped 4.1%.
  • In Hong Kong, consumer electronics company, Lenovo Group (HK: 0992 ) has jumped 6.0%.
  • On the other hand, automobile company, Li Auto (NASDAQ: LI ) has declined 2.0%.
  • In South Korea, logistics company, CJ Logistics Corporation (KS: 000120 ) has shed 3.9%.
  • On the contrary, departmental store company, Daegu Department Store (KS: 006370 ) has surged 9.8%.
  • The Nikkei 225 index is trading 0.5% higher at 38,392.10.
  • The Hang Seng index has gained 1.0% to trade at 18,504.58, while the Kospi index is trading 0.9% lower at 2,721.67.

COMMODITIES

  • At 05:30 SAST today, Brent prices rose 0.5% to trade at $83.96/bl.
  • Yesterday, Brent prices rose 0.5% to settle at $83.58/bl, following a drop in the US crude inventories as refiners slowly ramped up output ahead of the summer driving season. Additionally, the US Energy Information Administration (EIA) reported that the US crude inventories fell by 1.36mn bls in the week ended 3 May 2024.
  • At 05:30 SAST today, gold prices advanced 0.1% to trade at $2,311.73/oz. Yesterday, gold declined 0.3% to close at $2,309.05/oz, as strength in the dollar dented demand for the precious yellow metal.
  • Yesterday, copper declined 1.6% to close at $9,739.75/mt. Aluminium closed 0.6% lower at $2,548.80/mt.

CURRENCIES

  • Yesterday, the South African rand weakened against the US dollar. In the US, the number of MBA mortgage applications rose in the week ended 03 May 2024.
  • The yield on benchmark government bonds rose yesterday. The yield on the 2030 bond advanced to 10.77%, while that for the longer-dated 2040 issue rose to 13.11%.
  • At 05:30 SAST, the US dollar is trading slightly higher against the South African rand at R18.5738, while the euro is trading slightly higher at R19.964. At 05:30 SAST, the British pound has marginally gained against the South African rand to trade at R23.2132.
  • Yesterday, the euro remained mixed against most of the major currencies. In Germany, industrial production declined for the first time in 3 months in March, amid a drop in consumer and intermediate goods output. In the UK, the RICS housing price balance declined more than expected in April.
  • At 05:30 SAST, the euro slightly slipped against the US dollar to trade at $1.0748, while it has marginally gained against the British pound to trade at GBP0.8601.

ECONOMIC UPDATES

  • In the UK, the RICS housing price balance fell 5.0% in April, more than market expectations and compared to a revised fall of 5.0% recorded in the prior month.
  • In Italy, seasonally adjusted retail sales unexpectedly recorded a flat reading in March, compared to a rise of 0.1% recorded in the prior month.
  • In Germany, industrial production dropped 0.4% on a MoM basis in March, less than market expectations for a drop of 0.6%. Industrial production had recorded a revised a rise of 1.7% in the prior month.
  • In the US, the MBA mortgage applications rose 2.6% in the week ended 3 May 2024, compared to a drop of 2.3% recorded in the prior week.
  • In China, trade surplus widened to $72.35bn in April, compared to a surplus of $58.55bn recorded in the prior month.

CORPORATE UPDATES

SOUTH AFRICA

  • Anheuser-Busch InBev SA/NV (JO: ANHJ ): The drinks and brewing company, in its 1Q24 results, indicated that its revenue rose to $14.55bn from $14.21bn posted in the corresponding period of the previous year. Its underlying EPS increased 15.4% from the same period of the prior year to $0.75.

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