SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, as encouraging US economic data alleviated investors' recession concerns.
- Financial services group, Standard Bank (JO:SBKJ) skyrocketed 6.0% following the announcement of a 4.0% increase in headline earnings in its interim results, while also reaffirming its 2024 guidance.
- Retailers, Pepkor Holdings (JO:PPHJ), Truworths International (JO:TRUJ), Foschini Group (JO:TFGJ), Woolworths Holdings (JO:WHLJ) and Mr Price Group (JO:MRPJ) jumped 3.8%, 3.5%, 2.6%, 2.0% and 1.9%, respectively.
- On the other hand, mining company, Exxaro Resources (JO:EXXJ) declined 3.9%, after the company reported reduced coal production and sales for the first half of the year due to lower demand from Eskom and logistical issues.
- The JSE All Share index advanced 1.0% to close at 82,226.44.
UK MARKET REVIEW
- The UK market finished firmer yesterday, following upbeat British economic data.
- Insurance company, Admiral Group (LON:ADML) gained 6.51% after reporting a significant increase in its half-year pre-tax profits, surpassing analyst expectations.
- Banks, Barclays (LON:BARC), Standard Chartered (LON:STAN), HSBC Holdings (LON:HSBA), Lloyds Banking Group (LON:LLOY) and NatWest (LON:NWG) surged 4.1%, 3.7%, 2.2%, 2.0% and 1.7%, respectively.
- Retailers, JD Sports Fashion (LON:JD), Marks & Spencer Group (LON:MKS) and Burberry Group (LON:BRBY) advanced 2.9%, 1.3% and 0.8%, respectively.
- On the contrary, property developers, Barratt Developments (LON:BDEV) and Taylor Wimpey (LON:TW) shed 1.4% and 0.5%, respectively.
- Water utility companies, United Utilities Group (LON:UU) and Severn Trent (LON:SVT) eased 1.2% and 0.5%, respectively.
- The FTSE 100 index advanced 0.8% to close at 8,347.35.
US MARKET REVIEW
- US markets ended higher yesterday, driven by strong July US retail sales data that highlighted robust consumer spending and eased fears of a recession.
- Cisco Systems (NASDAQ:CSCO), a technology company, surged 6.8% after forecasting stronger-than-expected first-quarter revenue and announcing a 7% reduction in its global workforce.
- Discount retailer, Walmart (NYSE:WMT) advanced 6.6%, after the company raised its annual profit forecast for the second time this year, amid increased consumer traffic seeking affordable essentials.
- The S&P 500 index rose 1.6% to settle at 5,543.22, while the DJIA index advanced 1.4% to close at 40,563.06.
- The NASDAQ index climbed 2.3% to end the trading session at 17,594.50.
ASIA MARKET REVIEW
- Asian markets are trading higher this morning, following gains on Wall Street.
- In Japan, semiconductor company, Disco Corporation (TYO:6146) surged 5.5%.
- On the flipside, advertising company, Dentsu Group (TYO:4324) has declined 1.0%.
- In Hong Kong, shopping platform, Meituan (HK:3690) has advanced 3.5%.
- On the other hand, energy infrastructure company, CK Infrastructure Holdings (HK:1038) fell 2.0%.
- In South Korea, cosmetics company, Hankook Cosmetics (KS:003350) has surged 12.9%.
- On the contrary, equipment company, Kib plug energy Company (KS:015590) has declined 6.9%.
- The Nikkei 225 index is trading 2.9% higher at 37,800.42.
- The Hang Seng index has advanced 1.6% to trade at 17,384.35, while the Kospi index closed 1.8% higher at 2,692.37.
COMMODITIES
- At 05:30 SAST today, Brent prices decreased by 0.2% to trade at $80.86/bl.
- Yesterday, Brent prices rose 1.6% to settle at $81.04/bl, driven by positive US economic data that alleviated recession concerns.
- At 05:30 SAST today, gold prices dropped 0.3% to trade at $2,451.03/oz. Yesterday, gold gained 0.3% to close at $2,457.39/oz.
- Yesterday, copper rose 1.6% to close at $9,050.71/mt. Aluminium closed 0.9% higher at $2,347.45/mt.
CURRENCIES
- Yesterday, the South African rand strengthened against the US dollar. In the US, retail sales increased in July, while initial jobless claims decreased for the week ending 09 August 2024. Additionally, industrial production dropped in July.
- The yield on benchmark government bonds were mixed yesterday. The yield on the 2030 bond fell to 9.08%, while that for the longer-dated 2040 issue advanced to 11.25%.
- At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R17.9873, while the euro is trading marginally lower at R19.7519. At 05:30 SAST, the British pound has marginally gained against the South African rand to trade at R23.1558.
- Yesterday, the euro declined against most of the major currencies. In the UK, economy expanded again in 2Q24 but the pace of growth slowed slightly due to the contractions in industrial and construction output. Moreover, both, industrial and manufacturing production advanced in June.
- At 05:30 SAST, the euro advanced 0.1% against the US dollar to trade at $1.0981, while it has weakened 0.1% against the British pound to trade at GBP0.8531.
ECONOMIC UPDATES
- In the UK, the flash gross domestic product (GDP) recorded a rise of 0.6% on a QoQ basis in 2Q24, matching market expectations and slightly lower than the 0.7% growth recorded in the previous quarter.
- In the UK, industrial production increased by 0.8% on a MoM basis in June, surpassing market expectations for a rise of 0.1%. Industrial production had registered a revised rise of 0.3% in the prior month.
- In the UK, the manufacturing production recorded a rise of 1.1% on a MoM basis in June, compared to a revised rise of 0.3% in the prior month.
- In the UK, goods trade deficit widened to GBP18.89bn in June, from a revised deficit of GBP18.59bn in the previous month.
- In the US, initial jobless claims unexpectedly dropped to 227.00K in the week ended 09 August 2024, compared to a revised reading of 234.00K in the prior week.
- In the US, the NY Empire State manufacturing index rose to a level of -4.70 in August, compared to a level of -6.60 in the previous month.
- In the US, the Philadelphia Fed manufacturing index recorded a fall to a level of 7.00, compared to a rise of 13.90 in the previous month.
- In the US, retail sales rose 1.0% on a MoM basis in July, compared to a revised drop of 0.2% recorded in the prior month.
- In the US, industrial production registered a drop of 0.6% on a MoM basis in July. In the prior month, industrial production had advanced a revised 0.3%.
- In Japan, the final industrial production fell 7.9% on a YoY basis in June. Industrial production had recorded a rise of 1.1% in the prior month.
CORPORATE UPDATES
SOUTH AFRICA
- Standard Bank Group Limited (JO:SBKJ): The financial services company, in its results for the six months ending 30 June 2024, reported a slight increase in total net income toR88.37bn as compared with R88.10bn posted in the same period of the previous year. However, its diluted EPS decreased to 1,284.80c as compared with 1,308.40c recorded in the same period last year.
- Exxaro Resources Limited (JO:EXXJ): The mining company, in its 1H24 results, reported revenues of R18.98bn, slightly up from R18.94bn in the same period of the previous year. Its diluted EPS stood at 1,523.00c as compared with 2,440.00c recorded in the corresponding period of the prior year.
- Resilient REIT Limited (JO:RESJ): The real estate investment trust company, in its interim results, reported an increase in total revenues to R1.78bn, compared to R1.66bn in the same period last year. Diluted EPS rose to 408.48c as compared with 293.48c posted in the previous year.