South Africa Market Review
- South African markets closed in the red yesterday, ahead of South African Reserve Bank’s (SARB) monetary policy meeting.
- Pharmaceutical companies, Adcock Ingram Holdings (JO:AIPJ), Netcare (JO:NTCJ) and Life Healthcare Group (JO:LHCJ) dropped 2.5%, 1.2% and 0.9%, respectively.
- Platinum miners, Northam Platinum (JO:NHMJ) and Anglo American Platinum (JO:AMSJ) declined 2.4% and 2.2%, respectively.
- Lenders, Capitec Bank Holdings (JO:CPIJ) and RMB Holdings (JO:RMHJ) shed 2.3% and 2.0%, respectively.
- Diversified miners, Exxaro Resources (JO:EXXJ) and Anglo American (JO:AGLJ) fell 1.2%, each.
- On the flipside, property developers, Shaftesbury Capital, Redefine Properties (JO:RDFJ) and Resilient REIT (JO:RESJ) climbed 6.9%, 1.2% and 1.0%, respectively.
- The JSE All Share index marginally declined to close at 77,080.97.
UK Market Review
- The UK market finished firmer yesterday, as slowing inflation raised hopes for a pause in interest rates hikes by Bank of England (BoE).
- Financial services company, Hargreaves Lansdown (LON:HRGV) gained 8.8%, after the company reported higher net new business and assets under administration in 4Q23.
- Real estate companies, Land Securities Group (LON:LAND), Barratt Developments (LON:BDEV) and Berkeley Group Holdings (LON:BKGH) surged 7.7%, 7.0% and 5.2%, respectively.
- Water utilities company, United Utilities Group (LON:UU) and Severn Trent (LON:SVT) advanced 3.7% and 3.5%, respectively.
- On the other hand, miner, Antofagasta (LON:ANTO) declined 1.4%, after the company slashed its copper output guidance for FY23.
- The FTSE 100 index advanced 1.8% to close at 7,588.20.
US Market Review
- US markets ended higher yesterday, following upbeat corporate results.
- Used-car retail company, Carvana skyrocketed 40.2%, after the company reported robust sales in 2Q23 and announced a deal with bondholders to cut its outstanding debt by more than $1.00bn.
- Telecommunications company, AT&T (NYSE:T) surged 8.5%, after the company revealed that it did not intend to immediately remove lead cables from Lake Tahoe pending further analysis.
- Banking company, US Bancorp (NYSE:USB) climbed 6.5%, after the company reported a 28% jump in its net interest income.
- The S&P 500 index rose 0.2% to settle at 4,565.72, while the DJIA index advanced 0.3% to close at 35,061.21.
- The NASDAQ index marginally climbed to end the trading session at 14,358.02.
Asia Market Review
- Asian markets are trading mostly lower this morning.
- In Japan, electronics company, Renesas Electronics (TYO:6723) has declined 2.9%.
- On the flipside, automobile company, Nissan Motor (TYO:7201) has gained 1.5%.
- In Hong Kong, real estate company, Longfor Group Holdings (HK:0960) has advanced 3.3%.
- On the other hand, consumer electronics company, Lenovo Group (HK:0992) has eased 1.6%.
- In South Korea, semiconductor company, Mirae Corporation (KS:025560) has climbed 6.5%.
- On the contrary, chemical company, Aekyung Chemical (KS:161000) has dropped 5.4%.
- The Nikkei 225 index is trading 1.1% lower at 32,521.88.
- The Hang Seng index has advanced 0.3% to trade at 19,015.74, while the Kospi index is trading marginally lower at 2,608.09.
Commodities
- At 05:30 SAST today, Brent prices rose 0.1% to trade at $79.53/bl.
- Yesterday, Brent prices fell 0.2% to settle at $79.46/bl. The US Energy Information Administration (EIA) reported that US crude inventories fell by 0.71mn bls in the week ended 14 July 2023.
- At 05:30 SAST today, gold prices advanced 0.4% to trade at $1,986.06/oz. Yesterday, gold marginally declined to close at $1,977.88/oz, as a stronger greenback dented demand for the safe haven yellow metal.
- Yesterday, copper declined 0.7% to close at $8,353.65/mt. Aluminium closed 0.4% lower at $2,194.28/mt.
Currencies
- Yesterday, the South African rand weakened against the US dollar. In South Africa, consumer price inflation eased to its lowest in 20 months in June. In the US, the number of MBA mortgage applications advanced in the week ended 14 July 2023. Moreover, building permits rose in June. Meanwhile, housing starts sharply declined in June.
- The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 8.99%. Further, the yield on the longer-dated 2030 issue fell to 10.31%.
- At 05:30 SAST, the US dollar is trading 0.2% lower against the South African rand at R17.8430, while the euro is trading 0.1% higher at R20.0281. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.1155.
- Yesterday, the euro mostly declined against most of the major currencies. In the UK, consumer inflation eased more than expected in June.
- At 05:30 SAST, the euro advanced 0.2% against the US dollar to trade at $1.1226, while it has gained 0.1% against the British pound to trade at GBP0.8666.
Economic Updates
- In South Africa, the consumer price index (CPI) climbed 5.4% on a YoY basis in June, compared to a rise of 6.3% in the previous month.
- In South Africa, the CPI rose 0.2% on a MoM basis in June, less than market expectations and compared to a rise of 0.2% in the previous month.
- In South Africa, retail sales declined 1.4% on a YoY basis in May, more than market expectations for a drop of 1.1%. Retail sales had recorded a revised drop of 1.8% in the previous month.
- In the UK, the CPI rose 0.1% on a MoM basis in June, less than market expectations for a rise of 0.4%. The CPI had advanced 0.7% in the previous month.
- In the UK, the DCLG house price index rose 1.9% on a YoY basis in May, less than market expectations and compared to a revised rise of 3.2% recorded in the previous month.
- In the eurozone, seasonally adjusted construction output advanced 0.2% on a MoM basis in May, compared to a revised drop of 0.6% recorded in the previous month.
- In the eurozone, the final CPI climbed 0.3% on a MoM basis in June, compared to a flat reading in the prior month.
- In the US, the MBA mortgage applications rose 1.1% in the week ended 14 July 2023, compared to a rise of 0.9% recorded in the previous week.
- In the US, building permits dropped 3.7% on a MoM basis in June, compared to a revised rise of 5.6% recorded in the prior month.
- In the US, housing starts recorded a drop of 8.0% on a MoM basis in June. In the previous month, housing starts had recorded a revised rise of 15.7%.
- In Japan, merchandise trade balance recorded a surplus of JPY43.00 billion in June, compared to a revised deficit of JPY1,381.90 billion in the previous month.
- The People’s Bank of China (PBoC) kept its key interest rate unchanged at 3.55%, in line with market expectations.
- In Australia, the unemployment rate fell to 3.5% in June, compared to 3.6% recorded in the previous month.
Corporate Updates
South Africa
- Pick ‘n Pay Stores Limited (JO:PIKJ): The retail company, in its trading update for the 20 weeks ended 16 July 2023, revealed that overall sales increased 4.8% compared to the previous year. South Africa sales growth for this period was 4.4% (0.9% like-for-like), while the Group’s rest of Africa segment sales increased 15.9% (12.0% on a constant currency basis). Further, it expects earnings per share (EPS), headline earnings per share (HEPS), and pro forma headline earnings per share (pro forma HEPS) for 1H24 to decrease by more than 20% when compared to EPS, HEPS and pro forma HEPS reported for 1H23.
- Super Group Limited (JO:SPGJ): The logistics company announced an agreement to acquire 78.82% of the equity of CBW Group Holdings Limited from Amco for a purchase consideration of GBP30.30mn.
- Accelerate Property Fund Limited (JO:APFJ): The real estate investment trust company, in its FY23 results, indicated that revenues fell to R856.48mn from R912.50mn posted in the previous year. Its diluted loss per share stood at 52.27c, compared with an EPS of 6.42c recorded in the previous year.
- Oil steady as traders mull demand concerns and supply strains: Oil prices were little changed as markets weighed US demand concerns against China’s pledge to support economic growth.