SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, supported by a slowdown in domestic inflation data and on anticipation of potential rate cuts by the US Federal Reserve (Fed).
- Telecommunications companies, Blue Label Telecoms (JO:BLUJ) and Telkom SA SOC (JO:TKGJ) surged 14.5% and 3.1%, respectively.
- Lenders, Absa Group (JO:ABGJ), Nedbank Group (JO:NEDJ) and FirstRand (JO:FSRJ) advanced 2.5%, 1.1% and 0.6%, respectively.
- Diversified miners, Anglo American (JO:AGLJ), Pan African Resources (JO:PANJ) and Kumba Iron Ore (JO:KIOJ) gained 2.2%, 1.7% and 1.0%, respectively.
- Retailers, Foschini Group (JO:TFGJ), Cashbuild (JO:CSBJ) and Shoprite Holdings (JO:SHPJ) added 1.4%, 0.9% and 0.8%, respectively.
- The JSE All Share index advanced 0.3% to close at 84,026.19.
UK MARKET REVIEW
- The UK market finished firmer yesterday, buoyed by gains in mining sector stocks and ahead of the US Federal Reserve's July meeting minutes.
- Retailers, JD Sports Fashion (LON:JD) and Marks & Spencer Group (LON:MKS) advanced 4.0% and 1.1%, respectively.
- Miners, Anglo American, Rio Tinto (LON:RIO), Glencore (LON:GLEN) and Fresnillo (LON:FRES) gained 1.5%, 1.2%, 0.8% and 0.5%, respectively.
- On the other hand, water utilities companies, Severn Trent (LON:SVT) and United Utilities Group (LON:UU) dropped 2.5% and 1.1%, respectively.
- Energy utilities companies, Centrica (LON:CNA) and SSE (LON:SSE) declined 1.1% and 0.8%, respectively.
- The FTSE 100 index advanced 0.1% to close at 8,283.43.
US MARKET REVIEW
- US markets ended higher yesterday, due to a reinforced expectations of a September Fed rate cut following a significant downward revision in payroll data and positive earnings reports from major companies.
- Departmental store company, Target Corporation (NYSE:TGT) surged 11.2%, after the company reported a rise in same-store sales in 2Q24 and raised its profit forecast for FY24.
- Discount retail company, TJX Companies (NYSE:TJX) advanced 6.1%, after the company upgrade its annual profit forecast.
- On the contrary, departmental store chain company, Macy’s (NYSE:M) plunged 12.9%, after the company slashed its annual net sales forecast.
- The S&P 500 index rose 0.4% to settle at 5,620.85, while the DJIA index advanced 0.1% to close at 40,890.49.
- The NASDAQ index climbed 0.6% to end the trading session at 17,918.99.
ASIA MARKET REVIEW
- Asian markets are trading mostly higher this morning, as Japan’s business activity accelerated in August.
- In Japan, pharmaceutical company, Chugai Pharmaceutical (TYO:4519) has advanced 4.3%.
- On the flipside, electric wires and cables company, Fujikura (TYO:5803) has declined 1.9%.
- In Hong Kong, consumer electronics company, Lenovo Group (HK:0992) has added 1.3%.
- On the other hand, real estate company, Longfor Group Holdings (HK:0960) has shed 4.6%.
- In South Korea, chemical company, ISU Specialty Chemical (KS:457190) has plunged 7.2%.
- On the contrary, pharmaceutical company, Il Dong Pharmaceutical (KS:249420) has surged 7.7%.
- The Nikkei 225 index is trading 0.6% higher at 38,190.85.
- The Hang Seng index has gained 0.2% to trade at 17,419.19, while the Kospi index is trading 0.2% lower at 2,696.35.
COMMODITIES
- At 05:30 SAST today, Brent prices rose 0.1% to trade at $76.1/bl.
- Yesterday, Brent prices fell 1.5% to settle at $76.05/bl, due to concerns about economic slowdown from revised US employment data. Meanwhile, the US Energy Information Administration (EIA) reported that the US crude inventories fell by 4.65mn bls in the week ended 16 August 2024.
- At 05:30 SAST today, gold prices declined 0.4% to trade at $2,501.60/oz. Yesterday, gold marginally declined to close at $2,511.95/oz.
- Yesterday, copper rose 0.6% to close at $9,135.96/mt. Aluminium closed 0.1% lower at $2,475.75/mt.
CURRENCIES
- Yesterday, the South African rand weakened against the US dollar. In South Africa, the consumer price index (CPI) declined to a 3-year low in July. In the US, the number of MBA mortgage applications dropped in the week ended 16 August 2024.
- The yield on benchmark government bonds fell yesterday. The yield on the 2030 bond declined to 9.07%, while that for the longer-dated 2040 issue eased to 11.20%.
- At 05:30 SAST, the US dollar is trading 0.4% higher against the South African rand at R17.8872, while the euro is trading 0.3% higher at R19.9353. At 05:30 SAST, the British pound has gained 0.3% against the South African rand to trade at R23.4109.
- Yesterday, the euro mostly advanced against most of the major currencies.
- At 05:30 SAST, the euro slipped 0.1% against the US dollar to trade at $1.1144, while it has marginally weakened against the British pound to trade at GBP0.8518.
ECONOMIC UPDATES
- In South Africa, the consumer price index (CPI) rose 0.4% on a MoM basis in July, compared to a rise of 0.1% recorded in the prior month.
- In South Africa, the CPI fell to 4.6% on a YoY basis in July, compared to 5.1% recorded in the previous month.
- In the US, the MBA mortgage applications dropped 10.1% in the week ended 16 August 2024, compared to a rise of 16.8% recorded in the previous week.
- In Canada, the new housing price index unexpectedly rose 0.2% on a MoM basis in July, compared to a drop of 0.2% recorded in the previous month.
- In Japan, the Jibun Bank manufacturing PMI rose to a level of 49.50 in August, less than market expectations for a rise to a level of 49.80. The manufacturing PMI had recorded a level of 49.10 in the prior month.
- In Japan, the Jibun Bank services PMI rose to a level of 54.00 in August, compared to a level of 53.70 recorded in the previous month.
- In Australia, the Judo Bank manufacturing PMI rose to a level of 48.70 in August, compared to a level of 47.50 recorded in the prior month.
- In Australia, the Judo Bank services PMI rose to a level of 52.20 in August, compared to a level of 50.40 recorded in the previous month.
CORPORATE UPDATES
SOUTH AFRICA
- DRDGold Limited (JO:DRDJ): The gold mining company, in its FY24 results, reported revenues of R6.24bn higher from R5.50bn posted in the previous year. Its diluted EPS rose 3.6% from the prior year to 153.50c.
- RCL Foods Limited (JO:RCLJ): The food company, in its annual trading update, stated that it expects EPS from total operations to be 125.0% higher as compared with 69.30c recorded in the previous year. Also, it expects HEPS to be 75.0% higher as compared with 68.30c recorded in the prior year. Moreover, the company intends to release its annual financial results on 2 September 2024.
- Curro Holdings Limited (JO:COHJ): The schooling and education company, in its 1H24 results, reported that revenue advanced 8.3% from the same period of the preceding year to R2.59bn. Its diluted EPS stood at 40.20c, compared with 33.40c recorded in the corresponding period of the previous year.
- Blue Label Telecoms Limited (JO:BLUJ): The telecommunications company, in its trading update for the year ended 31 May 2024, revealed that it expects EPS to be between 71.88c to 73.10c, higher as compared with 30.48c recorded in the previous year. Also, it expects HEPS to be between 72.80c to 74.48c, higher as compared with 41.97c recorded in the previous year.
- Sibanye (JO:SSWJ) secures R1.80bn via gold prepayment deal: Sibanye-Stillwater has improved its cash position after securing a R1.80bn gold prepayment deal that will see the group sell almost 1,500kg of future gold production for upfront cash, which it will use to pay debt.