SOUTH AFRICA MARKET REVIEW
- South African markets closed in the red yesterday, led by losses in pharmaceutical and property sector stocks.
- Pharmaceutical companies, Life Healthcare Group (JO:LHCJ), Aspen Pharmacare (JO:APNJ) and Netcare (JO:NTCJ) dropped 7.4%, 2.8% and 2.7%, respectively.
- Property developers, Growthpoint Properties (JO:GRTJ), Redefine Properties (JO:RDFJ) and Attacq (JO:ATTJ) shed 5.8%, 4.5% and 3.4%, respectively.
- Retailers, Pick ‘n Pay Stores (JO:PIKJ), Mr Price Group (JO:MRPJ), Foschini Group (JO:TFGJ) and Shoprite Holdings (JO:SHPJ) declined 5.1%, 4.8%, 2.8% and 1.8%, respectively.
- Lenders, Nedbank Group (JO:NEDJ), FirstRand (JO:FSRJ), Standard Bank Group (JO:SBKJ) and Capitec Bank Holdings (JO:CPIJ) fell 4.1%, 3.1%, 2.3% and 1.9%, respectively.
- Diversified miners, Pan African Resources (JO:PANJ), Kumba Iron Ore (JO:KIOJ) and Exxaro Resources (JO:EXXJ) eased 4.1%, 2.7% and 1.2%, respectively.
- The JSE All Share index declined 1.4% to close at 73,736.63.
UK MARKET REVIEW
- The UK market finished weaker yesterday, weighed down by losses in retail sector stocks.
- Retailer, Burberry Group (LON:BRBY) plunged 11.2%, registering its biggest one-day percentage loss since September 2012, after the company reported a sharp slowdown in its comparable store-sales growth in 2Q24, amid low demand for luxury goods.
- Peers, JD Sports Fashion (LON:JD), B&M European Value Retail SA (LON:BMEB) and Next (LON:NXT) dropped 3.4%, 3.2% and 1.4%, respectively.
- Energy companies, Shell (LON:RDSa) and BP (LON:BP) shed 3.0% and 2.8%, respectively, amid drop in oil prices.
- Insurance companies, Prudential (LON:PRU), Legal & General Group (LON:LGEN) and Admiral Group (LON:ADML) eased 2.3%, 1.3% and 0.9%, respectively.
- On the other hand, healthcare company, Halma (LON:HLMA) advanced 3.2%, after the company reported higher revenue in 1H24.
- The FTSE 100 index declined 1.0% to close at 7,410.97.
US MARKET REVIEW
- US markets ended mostly higher yesterday, amid expectations that the Fed will end its rate hike cycle.
- Technology companies, Intel (NASDAQ:INTC), Microsoft Corporation (NASDAQ:MSFT) and Salesforce (NYSE:CRM) advanced 6.8%, 1.8% and 0.9%, respectively.
- Departmental store company, Macy’s (NYSE:M) jumped 5.7%, after the company reported higher profit in 3Q23.
- Media and entertainment companies, Netflix (NASDAQ:NFLX) and Walt Disney (NYSE:DIS) rose 1.1% and 0.6%, respectively.
- On the contrary, Cisco Systems (NASDAQ:CSCO) fell 9.8%, after the networking hardware maker provided a weak guidance for the current quarter and full fiscal year.
- Supermarket chain, Walmart (NYSE:WMT) dropped 8.1%, after the company issued a lower-than-expected annual forecast.
- The S&P 500 index rose 0.1% to settle at 4,508.24, while the DJIA index declined 0.1% to close at 34,945.47.
- The NASDAQ index climbed 0.1% to end the trading session at 14,113.67.
ASIA MARKET REVIEW
- Asian markets are trading lower this morning.
- In Japan, food and beverages company, Asahi Group Holdings (TYO:2502) has declined 4.1%.
- On the flipside, consumer electronics company, Hitachi (TYO:6501) has advanced 3.2%.
- In Hong Kong, e-commerce company, JD.com (HK:9618) has shed 3.2%.
- On the other hand, internet technology company, Netease (HK:9999) has gained 1.9%.
- In South Korea, chemical company, Green Chemical (KS:083420) has dropped 6.8%.
- On the contrary, logistics company, CJ Logistics (KS:000120) has climbed 9.6%.
- The Nikkei 225 index is trading 1.5% lower at 33,422.93.
- The Hang Seng index has declined 2.0% to trade at 17,480.08, while the Kospi index is trading 0.7% lower at 2,469.68.
COMMODITIES
- At 05:30 SAST today, Brent prices rose 0.3% to trade at $77.68/bl.
- Yesterday, Brent prices fell 4.6% to settle at $77.42/bl, amid concerns over global oil demand following dismal data from the US and Asia.
- At 05:30 SAST today, gold prices advanced 0.2% to trade at $1,985.90/oz. Yesterday, gold gained 1.1% to close at $1,982.70/oz, amid drop in the US Treasury yields.
- Yesterday, copper declined 0.6% to close at $8,121.85/mt. Aluminium closed 0.8% lower at $2,211.65/mt.
CURRENCIES
- Yesterday, the South African rand weakened against the US dollar. In the US, the initial jobless claims rose to a three-month high level in the week ended 10 November 2023. Moreover, the Philadelphia Fed manufacturing index rose in November. Meanwhile, the NAHB housing market index fell to its lowest level since December 2022 in November. Also, the industrial production dropped more than expected in October.
- The yield on benchmark government bonds fell yesterday. The yield on 2030 bond declined to 10.03% while that for the longer-dated 2040 issue fell to 12.17%.
- At 05:30 SAST, the US dollar is trading 0.1% higher against the South African rand at R18.384, while the euro is trading 0.1% higher at R19.9537. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R22.81.
- Yesterday, the euro advanced against most of the major currencies.
- At 05:30 SAST, the euro marginally advanced against the US dollar to trade at $1.0857, while it has gained 0.1% against the British pound to trade at GBP0.8749.
ECONOMIC UPDATES
- In Italy, global trade surplus widened to EUR2.35bn in September, compared to a revised surplus of EUR1.95bn recorded in the previous month.
- In the US, the number of initial jobless claims rose to a level of 231.00K in the week ended 10 November 2023, more than market expectations for a rise to a level of 220.0K. The number of initial jobless claims had recorded a revised level of 218.00K in the previous week.
- In the US, the Philadelphia Fed manufacturing index rose to a level of -5.90 in November, compared to a level of -9.00 recorded in the previous month.
- In the US, the NAHB housing market index fell to a level of 34.00 in November, compared to a level of 40.00 recorded in the previous year.
- In the US, industrial production dropped 0.6% on a MoM basis in October, more than market expectations for a drop of 0.3%. Industrial production had advanced by a revised 0.1% in the prior month.
- In the US, the Kansas Fed manufacturing activity index rose to a level of -3.00 in November, compared to a level of -8.00 recorded in the previous year.
CORPORATE UPDATES
SOUTH AFRICA
- Gold Fields Limited (JO:GFIJ): The gold mining company, in its operational update for the quarter ended 30 September 2023, stated that group attributable gold-equivalent production declined 9.0% to 542.0koz. Total tonnes milled/treated increased to 10.93mn from 10.77mn recorded in the previous year. The group all-in-sustaining costs (AIC) increased by 27.0% YoY (due to lower gold sold and above-inflation increases in costs across all operations compounded by initial spending of pre-production capital at the Windfall Project.
- Investec Limited (JO:INLJ): The banking company, in its 1H23 results, stated that its net interest income increased to GBP682.64mn from GBP607.83mn posted in the corresponding period of the previous year. Its diluted EPS fell 37.0% from the same period of the prior year to 67.00p.
- Life Healthcare Group Holdings Limited (JO:LHCJ): The pharmaceutical company, in its FY23 results, announced that its revenue from continuing operations rose 10.3% from the same period of the preceding year to R22.64bn. Its diluted EPS stood at 18.20c, compared with 105.30c recorded in the corresponding period of the previous year.
- Burstone Group Limited (JO:BTNJ): The real estate investment trust company, in its 1H24 results, indicated that its revenue rose to R986.43mn from R915.74mn posted in the corresponding period of the previous year. Its basic and diluted EPS decreased 40.0% from the same period of the prior year to 55.57c.
- Emira Property Fund Limited (JO:EMIJ): The real estate investment trust company, in its 1H23 results, reported that its revenue advanced 12.5% from the same period of the preceding year to R944.55mn. Its diluted EPS stood at 17.20c, compared with 115.45c recorded in the corresponding period of the previous year.
- Oil loses more ground on signs of increase in US supply: Oil prices fell extending losses from the previous session, as signals of higher supply from the US met worry about lacklustre energy demand from China.