South Africa Market Review
- South African markets closed in the red yesterday, as investors assessed hawkish comments from US Federal Reserve (Fed) Chair Jerome Powell.
- Platinum miners, Impala Platinum (JO:IMPJ), Anglo American Platinum (JO:AMSJ) and Northam Platinum (JO:NHMJ) edged down 5.9%, 4.8% and 3.3%, respectively.
- Diversified miners, African Rainbow Minerals (JO:ARIJ), Exxaro Resources (JO:EXXJ), Kumba Iron Ore (JO:KIOJ) and Anglo American (JO:AGLJ) shed 4.3%, 3.6%, 2.5% and 2.4%, respectively.
- Retailers, SPAR Group (JO:SPPJ), Mr Price Group (JO:MRPJ) and Lewis Group (JO:LEWJ) declined 1.9%, 1.8% and 1.1%, respectively.
- Pharmaceutical companies, Life Healthcare Group (JO:LHCJ) and Aspen Pharmacare (JO:APNJ) fell 1.6% and 1.5%, respectively.
- Gold miners, Gold Fields (JO:GFIJ) and AngloGold Ashanti (JO:ANGJ) eased 1.0% and 0.9%, respectively.
- The JSE All Share index declined 1.5% to close at 75,629.88.
UK Market Review
- The UK market finished weaker yesterday, as a rise in domestic inflation raised worries over another rate hike by the Bank of England (BoE).
- Paper and packaging companies, DS Smith (LON:SMDS), Smurfit Kappa Group (LON:SKG) and Mondi (LON:MNDI) shed 6.0%, 5.5% and 3.3%, respectively.
- Real estate company, Berkeley Group Holdings (LON:BKGH) fell 1.6%, after the company warned of lower sales in FY24.
- Peers, Barratt Developments (LON:BDEV) and Land Securities Group (LON:LAND) declined 4.1% and 1.5%, respectively.
- Banking firms, NatWest Group (LON:NWG), Lloyds Banking Group (LON:LLOY) and Barclays (LON:BARC) shed 4.0%, 2.4% and 1.9%, respectively.
- Retailers, Burberry Group (LON:BRBY) and J Sainsbury (LON:SBRY) fell 3.9% and 1.3%, respectively.
- On the other hand, energy companies, BP (LON:BP) and Shell (LON:RDSa) advanced 2.2% and 1.8%, respectively.
- The FTSE 100 index declined 0.1% to close at 7,559.18.
US Market Review
- US markets ended lower yesterday, after US Fed Chairman, Jerome Powell indicated further interest rate hikes.
- Technology companies, Intel (NASDAQ:INTC), Salesforce (NYSE:CRM), International Business Machines (NYSE:IBM) and Cisco Systems (NASDAQ:CSCO) dropped 6.0%, 3.4%, 1.7% and 1.4%, respectively.
- Logistics company, FedEx Corporation (NYSE:FDX) shed 2.5%, after the company issued weaker than expected annual guidance.
- Financial services companies, Goldman Sachs Group (NYSE:GS) and American Express (NYSE:AXP) eased 1.7% and 0.9%, respectively.
- On the contrary, energy companies, Devon Energy Corporation (NYSE:DVN), Exxon Mobil Corporation (NYSE:XOM) and Chevron Corporation (NYSE:CVX) added 1.4%, 1.1% and 0.8%, respectively.
- The S&P 500 index fell 0.5% to settle at 4,365.69, while the DJIA index declined 0.3% to close at 33,951.52.
- The NASDAQ index eased 1.2% to end the trading session at 13,502.20.
Asia Market Review
- Asian markets are trading mostly higher this morning.
- In Japan, electronics company, Renesas Electronics (TYO:6723) has declined 3.0%.
- On the flipside, banking firm, Chiba Bank (TYO:8331) has advanced 3.6%.
- In Hong Kong, markets are closed today on account of a public holiday.
- In South Korea, textile company, Willbes & Company (KS:008600) has gained 12.1%.
- On the contrary, food company, Sempio Foods (KS:007540) has edged down 7.1%.
- Yesterday, the Hang Seng index declined 2.0% to close at 19,218.35.
- Today, the Nikkei 225 index is trading marginally higher at 33,575.63, while the Kospi index is trading 0.4% higher at 2,593.10.
Commodities
- At 05:30 SAST today, Brent prices fell 0.3% to trade at $76.86/bl.
- Yesterday, Brent prices rose 1.6% to settle at $77.12/bl, as a jump in US corn and soybean prices raised expectations that crop shortfalls could increase fuel demand. Additionally, the American Petroleum Institute (API) reported that the US crude oil inventories declined by 1.25mn bls in the week ended 16 June 2023.
- At 05:30 SAST today, gold prices advanced 0.1% to trade at $1,933.38/oz. Yesterday, gold declined 0.2% to close at $1,932.26/oz, as a stronger dollar and a rise in the US Treasury yields dented demand for the safe haven yellow metal.
- Yesterday, copper rose 0.5% to close at $8,606.10/mt. Aluminium closed 1.2% lower at $2,208.95/mt.
Currencies
- Yesterday, the South African rand strengthened against the US dollar. In South Africa, consumer price inflation eased to a 13-month low in May. In the US, Fed Chairman Jerome Powell reinforced the likelihood of further interest rate hikes.
- The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 9.36%. Further, the yield on the longer-dated 2030 issue fell to 10.72%.
- At 05:30 SAST, the US dollar is trading 0.2% higher against the South African rand at R18.3462, while the euro is trading 0.2% higher at R20.1656. At 05:30 SAST, the British pound has gained 0.1% against the South African rand to trade at R23.4244.
- Yesterday, the euro advanced against most of the major currencies. In the UK, the CPI remained unchanged in May.
- At 05:30 SAST, the euro slipped 0.5% against the US dollar to trade at $1.0933, while it has marginally gained against the British pound to trade at GBP0.8611.
Economic Updates
- In South Africa, the consumer price index (CPI) climbed 6.3% on a YoY basis in May, less than market expectations for a rise of 6.5%. The CPI had recorded a rise of 6.8% in the previous month.
- In South Africa, the CPI climbed 0.2% on a MoM basis in May, less than market expectations for a rise of 0.4%. The CPI had risen 0.4% in the prior month.
- In the UK, the CPI rose 0.7% on a MoM basis in May, more than market expectations for a rise of 0.5%. The CPI had recorded a rise of 1.2% in the previous month.
- In the UK, the CPI rose 8.7% on a YoY basis in May, compared to a similar rise in the previous month. Market expectations were for the CPI to climb 8.4%.
- In the US, MBA mortgage applications rose 0.5% in the week ended 16 June 2023, compared to a rise of 7.2% recorded in the previous week.
- In Canada, the house price index rose 0.1% on a MoM basis in May, compared to a drop of 0.1% in the prior month.
- In Canada, retail sales rose 1.1% on a MoM basis in April, more than market expectations for a rise of 0.2%. Retail sales had recorded a revised drop of 1.5% in the previous month.
Corporate Updates
South Africa
- Anglo American Plc (JO:AGLJ): The mining company announced that the value of rough diamond sales (Global Sightholder Sales and Auctions) for De Beers’ fifth sales cycle of 2023, amounted to $450.00mn.
- FirstRand Limited (JO:FSRJ): The banking company, in its annual trading update, revealed that it expects the ROE to remain at the upper end of the stated range of 18% to 22% in the second half. Moreover, net interest income (NII) has benefited from growth in customer deposits and the positive endowment impact resulting from the higher rates and continued advances growth. Meanwhile, non-interest revenue (NIR) growth is slightly ahead of management expectations. Further, the company intends to release its full year results to 30 June 2023 on 14 September 2023.
- Clicks (JO:CLSJ) limits access to customers’ personal data after cyberattack: Clicks has deployed a security patch to limit access to customers’ personal data after a cyberattack.