SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, bolstered by robust domestic economic data and upbeat global market sentiment.
- Retailers, Italtile (JO:ITEJ), Woolworths Holdings (JO:WHLJ), Shoprite Holdings (JO:SHPJ), Foschini Group (JO:TFGJ) and Spar Group (JO:SPPJ) added 4.4%, 3.4%, 3.1%, 2.3% and 2.1%, respectively.
- Financial services companies, Remgro (JO:REMJ), Transaction Capital (JO:TCPJ), Momentum Metropolitan Holdings (JO:MTMJ), and Quilter (JO:QLTJ) advanced 3.8%, 3.7%, 3.4% and 2.5%, respectively.
- Consumer goods companies. Astral Foods (JO:ARLJ), Tiger Brands (JO:TBSJ) and Famous Brands (JO:FBRJ) surged 2.5%, 1.8% and 1.1%, respectively.
- On the flipside, diversified miners, Kumba Iron Ore (JO:KIOJ), Anglo American (JO:AGLJ), South32 (JO:S32J), African Rainbow Minerals (JO:ARIJ) and Pan African Resources (JO:PANJ) shed 6.0%, 2.9%, 2.3%, 1.1% and 0.9%, respectively.
- The JSE All Share index advanced 0.6% to close at 81,402.31.
UK MARKET REVIEW
- The UK market finished firmer yesterday, as softer domestic consumer price data increased expectations of rate cut by the Bank of England.
- Betting and gaming company, Flutter Entertainment (LON:FLTRF) jumped 10.5 after raising its full-year guidance due to a stronger-than-anticipated second-quarter performance.
- Homebuilding companies, Berkeley Group Holdings (LON:BKGH), Barratt Developments (LON:BDEV), Taylor Wimpey (LON:TW) and Persimmon (LON:PSN) gained 3.9%, 3.8%, 3.6% and 3.4%, respectively.
- Telecommunications companies, BT Group (LON:BT) and Vodafone Group PLC (LON:VOD) advanced 3.6% and 1.1%, respectively.
- On the other hand, mining companies, both, Rio Tinto (LON:RIO) and Anglo American (LON:AAL) declined 1.5%, each.
- The FTSE 100 indexadvanced 0.6% to close at 8,281.05.
US MARKET REVIEW
- US markets ended higher yesterday, supported by encouraging inflation data that increased expectations for a Federal Reserve (Fed) rate cut.
- Insurance company, Allstate Corporation (NYSE:ALL) gained 5.2%, after the company entered into an agreement to sell its employer voluntary benefits business to StanCorp Financial Group for a total of $2.00bn in cash.
- Cardinal Health (NYSE:CAH), a healthcare company, advanced 3.7% following an increase in its 2025 profit forecast, driven by strong demand for branded and specialty medicines.
- The S&P 500 index rose 0.4% to settle at 5,455.21, while the DJIA index advanced 0.6% to close at 40,008.39.
- The NASDAQ index marginally climbed to end the trading session at 17,192.60.
ASIA MARKET REVIEW
- Asian markets are trading higher this morning, buoyed by Japan’s stronger-than-expected GDP growth in 2Q24.
- In Japan, automotive manufacturing company, Mazda Motor Corporation (TYO:7261) has gained 5.3%.
- On the flipside, electronics products company, Sony Group (NYSE:SONY) Corporation has declined 1.3%.
- In Hong Kong, internet company, NetEase (NASDAQ:NTES) has advanced 4.6%.
- On the other hand, food company, WH Group (HK:0288) has eased 1.6%.
- In South Korea markets are closed today on account of a public holiday. Yesterday, the Kospi index closed 0.9% higher at 2,644.50.
- Today, the Nikkei 225 index is trading 1.0% higher at 36,808.75.
- The Hang Seng index has advanced 0.4% to trade at 17,176.14.
COMMODITIES
- At 05:30 SAST today, Brent prices increased by 0.3% to trade at $79.98/bl, supported by optimism for potential rate cuts by the Fed.
- Yesterday, Brent prices fell 1.2% to settle at $79.76/bl, amid an unexpected jump in crude inventories and concerns about an possible easing of supply disruptions in the Middle East.
- At 05:30 SAST today, gold prices advanced 0.1% to trade at $2,452.12/oz. Yesterday, gold declined 0.6% to close at $2,449.48/oz, after US consumer price data dimmed expectations for a larger Fed rate cut.
- Yesterday, copper rose 0.8% to close at $8,905.35/mt. Aluminium closed 0.2% lower at $2,327.41/mt.
CURRENCIES
- Yesterday, the South African rand strengthened against the US dollar. In South Africa, retail sales advanced in June. In the US, the consumer price index rose moderately in July, raising expectations for the Federal Reserve rate cut next month. Additionally, mortgage applications increased during the week ending 9 August 2024.
- The yield on benchmark government bonds fell yesterday. The yield on the 2030 bond fell to 9.12%, while that for the longer-dated 2040 issue declined to 11.19%.
- At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R18.0581, while the euro is trading 0.2% lower at R19.8841. At 05:30 SAST, the British pound has declined 0.1% against the South African rand to trade at R23.1811.
- Yesterday, the euro advanced against most of the major currencies. In the eurozone, economy grew in 2Q24 , although industrial production unexpectedly declined in June. In the UK, consumer price inflation increased in July for the first time in 2024.
- At 05:30 SAST, the euro marginally slipped against the US dollar to trade at $1.1009, while it has weakened 0.1% against the British pound to trade at GBP0.8578.
ECONOMIC UPDATES
- In South Africa, retail sales recorded a rise of 4.1% on a YoY basis in June, compared to a revised rise of 1.1% in the previous month.
- In South Africa, retail sales recorded a rise of 1.6% on a MoM basis in June, compared to a revised fall of 0.2% in the previous month.
- In the UK, the DCGL house price index climbed 2.7% on a YoY basis in June, compared to a rise of 2.2% recorded in the previous month.
- In the UK, the consumer price index (CPI) slid 0.2% on a MoM basis in July. The CPI had advanced 0.1% in the previous month.
- In France, the CPI rose 0.2% on a MoM basis in July, compared to a similar rise of 0.2% recorded in the previous month.
- In the eurozone, seasonally adjusted gross domestic product (GDP) advanced 0.3% on a QoQ basis in 2Q24, compared to a similar rise recorded in the previous quarter.
- In the eurozone, Industrial production eased 0.1% on a MoM basis in June, compared to a revised drop of 0.9% recorded in prior month.
- In the US, the number of mortgage applications registered a rise of 16.8% on a weekly basis in the week ended 09 August 2024, compared to a rise of 6.9% recorded in the previous week.
- In US, the CPI climbed 0.2% on a MoM basis in July, at par with market expectations and compared to a drop of 0.1% recorded in the previous month.
- In Japan, annualized GDP advanced 3.1% on a YoY basis in 2Q24, compared with a revised drop of 2.3% recorded in the prior quarter.
- In China, industrial production recorded a rise of 5.1% on a YoY basis in July, less than market expectations and compared to 5.3% recorded in the prior month.
- In China, retail sales rose 2.7% on a YoY basis in July, compared to 2.0% recorded in the previous month.
- In Australia, seasonally adjusted unemployment rate rose to 4.2% in July, compared to 4.1% recorded in the previous month.
CORPORATE UPDATES
SOUTH AFRICA
- Northam Platinum Holdings Limited (JO:NPHJ): The platinum mining company, in its trading statement for the year ended 30 June 2024, reported that it has achieved a 10.3% increase in equivalent refined metal production from its own operations, driven by strong contributions at Booysendal and Eland. However, despite this production growth, the company's sales revenue fell by 22.2% due to a significant 35.5% drop in the 4E ZAR basket price, resulting in a 68.8% decrease in gross profit and a projected drop in earnings per share. The group's overall financial performance reflects a challenging market environment but maintains a focus on operational excellence and sustainable production. It expects basic EPS to be between 24.6% to 34.6% lower as compared with 654.50c recorded in the previous year.
- ADvTECH Limited (JO:ADHJ): The company in its voluntary trading statement for the six months ending 30 June 2024, the private education and recruitment company announced that it expects EPS and HEPS to increase by 13.0% to 18.0% compared to 84.40c and 84.30c, respectively, recorded in the same period last year.
- DRDGold Limited: The gold mining company, in its voluntary trading statement and trading update for the year ended 30 June 2024, reported that group revenue increased 14.0% to R6.24bn as compared with R5.50bn recorded in the same period of the prior year. EPS is expected to range between 146.60c to 161.50c, compared to 149.10c recorded in the previous year, with HEPS expected to be between 146.60c and 161.40c, similar to the previous year.
- Lighthouse Properties Plc (JO:LTEJ): The real estate investment company, in its 1H24 results, reported that total revenues advanced to EUR49.07mn, as compared with EUR38.15mn recorded in the corresponding period of the prior year. Its diluted EPS fell to 0.82 Euro cents.
- Aveng Limited (JO:AEGJ): The construction and engineering company, in its annual trading statement, stated that diluted EPS is expected to be between 19.10 and 20.30 Australian cents as compared with a loss per share of 82.40 Australian cents recorded in the prior year and HEPS is anticipated to be between 29.0 and 30.80 Australian cents as compared with a headline loss per share of 61.60 Australian cents recorded in the previous year. The Group expects to release its audited results on or about 20 August 2024.