Market Review, Commodities, Currencies, Economic & Corporate Update - 23.04.24

  • Market Overview

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the green yesterday, buoyed by gains in pharmaceutical and retail sector stocks.
  • Pharmaceutical companies, Life Healthcare (JO: LHCJ ) and Netcare (JO: NTCJ ) advanced 3.0% and 1.4%, respectively.
  • Retailers, SPAR Group (JO: SPPJ ), Cashbuild (JO: CSBJ ), Clicks Group (JO: CLSJ ) and Pick ‘n Pay Stores (JO: PIKJ ) gained 2.9%, 1.8%, 1.2% and 1.0%, respectively.
  • Food companies, RCL Foods (JO: RCLJ ), Famous Brands (JO: FBRJ ), RFG Holdings (JO: RFGJ ) and Tiger Brands (JO: TBSJ ) rose 2.8%, 1.3%, 0.7% and 0.6%, respectively.
  • Lenders, FirstRand (JO: FSRJ ), Nedbank Group (JO: NEDJ ) and Capitec Bank Holdings (JO: CPIJ ) added 1.7%, 1.0% and 0.8%, respectively.
  • On the flipside, platinum miners, Anglo American Platinum (JO: AMSJ ), Impala Platinum (JO: IMPJ ) and Northam Platinum (JO: NPHJ ) dropped 6.3%, 5.2% and 3.7%, respectively.
  • The JSE All Share index advanced 0.3% to close at 73,551.13.

UK MARKET REVIEW

  • The UK market finished firmer yesterday, amid expectations that rate cuts by the Bank of England (BoE) would begin in August.
  • Retailers, Marks & Spencer Group (LON: MKS ), J Sainsbury (LON: SBRY ), Next (LON: NXT ) and B&M European Value Retail S.A. (LON: BMEB ) jumped 4.4%, 3.9%, 3.2% and 2.8%, respectively.
  • Banking firms, HSBC Holdings (LON: HSBA ), Barclays (LON: BARC ) and NatWest Group (LON: NWG ) advanced 3.1%, 1.8% and 1.1%, respectively.
  • Pharmaceutical companies, AstraZeneca (LON: AZN ) and GSK (LON: GSK ) gained 2.8% and 2.5%, respectively.
  • Insurance companies, Legal & General Group (LON: LGEN ), Aviva (LON: AV ), Prudential (LON: PRU ) and Admiral Group (LON: ADML ) rose 2.4%, 2.0%, 1.9% and 1.6%, respectively.
  • Real estate companies, Barratt Developments (LON: BDEV ), Berkeley Group Holdings (LON: BKGH ) and Land Securities Group (LON: LAND ) added 2.3%, 1.8% and 1.0%, respectively.
  • The FTSE 100 index advanced 1.6% to close at 8,023.87.

US MARKET REVIEW

  • US markets ended higher yesterday, ahead of major US corporate earnings results due this week.
  • Automobile companies, Ford Motor (NYSE: F ) and General Motors (NYSE: GM ) jumped 6.1% and 2.0%, respectively.
  • Airlines companies, United Airlines Group (NASDAQ: UAL ), Delta Airlines (NYSE: DAL ) and American Airlines Group (NASDAQ: AAL ) advanced 5.0%, 3.1% and 3.0%, respectively.
  • Financial services companies, Goldman Sachs Group (NYSE: GS ), JPMorgan Chase (NYSE: JPM ), Visa (NYSE: V ) and American Express (NYSE: AXP ) gained 3.3%, 1.9%, 1.0% and 0.9%, respectively.
  • On the contrary, electric vehicle company, Tesla (NASDAQ: TSLA ) dropped 3.4%, after the company cut prices in several major markets, including China and Germany, amid declining sales and growing competition.
  • The S&P 500 index rose 0.9% to settle at 5,010.60, while the DJIA index advanced 0.7% to close at 38,239.98.
  • The NASDAQ index climbed 1.1% to end the trading session at 15,451.31.

ASIA MARKET REVIEW

  • Asian markets are trading higher this morning, tracking overnight gains on Wall Street.
  • In Japan, pharmaceutical company Astellas Pharma (TYO: 4503 ) has gained 1.8%.
  • On the flipside, automobile company, Yamaha Corporation (TYO: 7951 ) has declined 1.7%.
  • In Hong Kong, business services companies, Tencent Holdings (HK: 0700 ) has advanced 2.4%.
  • On the other hand, mining company, Zijin Mining Group (HK: 2899 ) has shed 2.1%.
  • In South Korea, shipbuilding and offshore services company, Hanwha Ocean (KS: 042660 ) has surged 7.3%.
  • On the contrary, food company Samyang Foods has dropped 6.1%. The Nikkei 225 index is trading 0.3% higher at 37,538.06.
  • The Hang Seng index has gained 1.2% to trade at 16,715.99, while the Kospi index is trading 0.1% higher at 2,633.19.

COMMODITIES

  • At 05:30 SAST today, Brent prices rose 0.4% to trade at $87.34/bl.
  • Yesterday, Brent prices fell 0.3% to settle at $87/bl, amid easing worries that the Middle East geopolitical tensions would affect supply.
  • At 05:30 SAST today, gold prices declined 1.3% to trade at $2,303.69/oz. Yesterday, gold declined 2.4% to close at $2,333.81/oz, as a stronger dollar dented demand for the safe haven yellow metal.
  • Yesterday, copper declined 0.6% to close at $9,741.83/mt. Aluminium closed 0.4% higher at $2,670.50/mt.

CURRENCIES

  • Yesterday, the South African rand weakened against the US dollar. In the US, the Chicago Fed national activity index rose in March.
  • The yield on benchmark government bonds rose yesterday. The yield on the 2030 bond advanced to 11.03%, while that for the longer-dated 2040 issue rose to 13.39%.
  • At 05:30 SAST, the US dollar is trading marginally higher against the South African rand at R19.2033, while the euro is trading 0.1% higher at R20.4617. At 05:30 SAST, the British pound has gained 0.1% against the South African rand to trade at R23.7144.
  • Yesterday, the euro mostly advanced against most of the major currencies. In the eurozone, the consumer confidence index improved less than expected in April.
  • At 05:30 SAST, the euro marginally advanced against the US dollar to trade at $1.0656, while it has marginally gained against the British pound to trade at GBP0.8630.

ECONOMIC UPDATES

  • In the eurozone, the consumer confidence index rose to a level of -14.70 in April, less than market expectations for a rise to a level of -14.00. The consumer confidence index had recorded a level of -14.90 in the prior month.
  • In the US, the Chicago Fed national activity index rose to a level of 0.15 in March, compared to a revised level of 0.09 recorded in the previous month.
  • In Canada, the new housing price index unexpectedly recorded a flat reading on a MoM basis in March, compared to a rise of 0.1% recorded in the prior month.
  • In Japan, the Jibun Bank manufacturing PMI unexpectedly rose to a level of 49.90 in April, compared to a level of 48.20 recorded in the prior month.
  • In Japan, the Jibun Bank services PMI rose to a level of 54.60 in April, compared to a level of 54.10 recorded in the previous month.
  • In Australia, the Judo Bank manufacturing PMI climbed to a level of 49.90 in April, compared to a level of 47.30 recorded in the previous month.
  • In Australia, the Judo Bank services PMI fell to a level of 54.20 in April, compared to a level of 54.40 recorded in the prior month.

CORPORATE UPDATES

SOUTH AFRICA

  • Merafe Resources Limited (JO: MRFJ ): The mining company, in its 1Q24 production update, revealed that attributable ferrochrome production fell to 77.00kt from 103.00kt recorded in the previous year. The reduction in production is due to the Rustenburg smelter which has not operated in 2024 in response to market conditions.
  • Cashbuild Limited (JO: CSBJ ): The retail company, in its 3Q24 operational update, revealed that group revenue increased 3.0% as compared with the previous year. For the 312 existing stores (in existence prior to July 2022), revenue increased by 2.0% and the 9 new stores, contributed 1.0% growth. Transactions through the tills increased by 1.0% as compared with the previous year.
  • Oil prices fall as tension eases between Iran and Israel: Oil prices fell, dragged down by a renewed focus on market fundamentals as Israel and Iran played down the risks of an escalation of hostilities in the Middle East, after Israel’s apparently small strike on Iran.

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