Market Review, Commodities, Currencies, Economic & Corporate Update - 26.03.24

  • Market Overview

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the green yesterday, buoyed by gains in telecommunications and precious metal mining sector stocks.
  • Telecommunications companies, Telkom SA SOC (JO: TKGJ ), Blue Label Telecoms (JO: BLUJ ) and MTN Group (JO: MTNJ ) jumped 3.2%, 2.8% and 1.6%, respectively.
  • Gold miners, AngloGold Ashanti (JO: ANGJ ), Harmony Gold Mining (JO: HARJ ) and Gold Fields (JO: GFIJ ) advanced 2.7%, 1.1% and 0.8%, respectively.
  • Property developers, Emira Property Fund (JO: EMIJ ), Equites Property Fund (JO: EQUJ ), Growthpoint Properties (JO: GRTJ ) and Redefine Properties (JO: RDFJ ) advanced 2.1%, 1.7%, 1.3% and 1.0%, respectively.
  • On the flipside, insurance companies, Discovery and Old Mutual (JO: OMUJ ) dropped 2.2% and 1.8%, respectively.
  • Retailers, Mr Price Group (JO: MRPJ ) and Clicks Group (JO: CLSJ ) fell 1.2% and 0.8%, respectively.
  • The JSE All Share index marginally advanced to close at 73,282.88.

UK MARKET REVIEW

  • The UK market finished weaker yesterday, as investors assessed recent gains on dovish pivot from major central banks.
  • Insurance company, Direct Line Insurance Group (LON: DLGD ) plunged 11.0%, after Ageas SA said it did not intend to make further offers to the company following two failed attempts.
  • Homebuilders, Persimmon (LON: PSN ) and Taylor Wimpey (LON: TW ) shed 2.5% and 0.9%, respectively.
  • Miners, Antofagasta (LON: ANTO ), Glencore (LON: GLEN ) (JO: GLNJ ) and Fresnillo (LON: FRES ) fell 1.4%, 1.2% and 0.7%, respectively.
  • On the other hand, home improvement retailer, Kingfisher (LON: KGF ) jumped 2.6%, after the company cautioned that profit would fall again this year.
  • Energy companies, BP (LON: BP ) and Shell (LON: RDSa ) advanced 1.4% and 0.7%, respectively, tracking higher crude prices amid supply concerns.
  • The FTSE 100 index declined 0.2% to close at 7,917.57.

US MARKET REVIEW

  • US markets ended lower yesterday, ahead of key inflation data due this week.
  • Technology companies, Intel (NASDAQ: INTC ), Microsoft (NASDAQ: MSFT ), International Business Machines (NYSE: IBM ) and Apple (NASDAQ: AAPL ) dropped 1.7%, 1.4%, 1.1% and 0.8%, respectively.
  • On the contrary, pharmaceutical companies, Moderna (NASDAQ: MRNA ), Amgen (NASDAQ: AMGN ) and Merck & Company (NYSE: MRK ) jumped 4.7%, 1.7% and 1.2%, respectively.
  • Airplanes company, Boeing (NYSE: BA ) advanced 1.4%, after the company announced that CEO Dave Calhoun would step down from his position at the end of 2024.
  • Energy companies, Devon Energy Corporation (NYSE: DVN ) and Chevron Corporation (NYSE: CVX ) gained 1.4% and 1.2%, respectively.
  • The S&P 500 index fell 0.3% to settle at 5,218.19, while the DJIA index declined 0.4% to close at 39,313.64.
  • The NASDAQ index eased 0.3% to end the trading session at 16,384.47.

ASIA MARKET REVIEW

  • Asian markets are trading mostly higher this morning.
  • In Japan, automobile company, Nissan Motor (TYO: 7201 ) has declined 4.3%.
  • On the flipside, logistics company, Mitsubishi Logistics (TYO: 9301 ) has advanced 3.4%.
  • In Hong Kong, real estate company, Longfor Group Holdings (HK: 0960 ) has gained 2.1%.
  • On the other hand, pharmaceutical company, Sinopharm Group (HK: 1099 ) has shed 2.0%.
  • In South Korea, chemical company, Sam Young Chemical (KS: 003720 ) has jumped 6.3%.
  • On the contrary, pharmaceutical company, Kukje Pharma (KS: 002720 ) dropped 4.7%.
  • The Nikkei 225 index is trading 0.1% lower at 40,364.40.
  • The Hang Seng index has gained 0.1% to trade at 16,488.40, while the Kospi index is trading 1.1% higher at 2,768.52.

COMMODITIES

  • At 05:30 SAST today, Brent prices marginally rose to trade at $86.79/bl.
  • Yesterday, Brent prices rose 1.5% to settle at $86.75/bl, after Russia ordered to curb oil output and as attacks in both Russia and Ukraine offset the UN's demand for a ceasefire in Gaza.
  • At 05:30 SAST today, gold prices declined 0.1% to trade at $2,170.55/oz. Yesterday, gold gained 0.4% to close at $2,173.01/oz, as investors await key inflation data due this week for further cues on interest rate cuts by the US Federal Reserve.
  • Yesterday, copper marginally rose to close at $8,743.35/mt. Aluminium closed slightly lower at $2,301.06/mt.

CURRENCIES

  • Yesterday, the South African rand strengthened against the US dollar. In the US, the Chicago Fed national activity index improved in January. Meanwhile, the new home sales unexpectedly decreased in February. Moreover, the Dallas Fed manufacturing business index declined in March.
  • The yield on benchmark government bonds rose yesterday. The yield on the 2030 bond advanced to 10.73%, while that for the longer-dated 2040 issue rose to 13.22%.
  • At 05:30 SAST, the US dollar is trading marginally lower against the South African rand at R18.8816, while the euro is trading 0.1% higher at R20.4774. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.8592.
  • Yesterday, the euro mostly declined against most of the major currencies.
  • At 05:30 SAST, the euro advanced 0.1% against the US dollar to trade at $1.0845, while it has slightly weakened against the British pound to trade at GBP0.8578.

ECONOMIC UPDATES

  • In the US, the Chicago Fed national activity index rose to a level of 0.05 in February, compared to a revised level of -0.54 recorded in the prior month.
  • In the US, new home sales unexpectedly fell 0.3% on a MoM basis in February, compared to a revised rise of 1.7% recorded in the prior month.
  • In the US, the Dallas Fed manufacturing business index fell to a level of -14.40 in March, compared to a level of -11.30 recorded in the prior month.
  • In Australia, the Westpac consumer confidence index dropped 1.8% in March, compared to a rise of 6.2% recorded in the previous month.

CORPORATE UPDATES

SOUTH AFRICA

  • MTN Group Limited (JO: MTNJ ): The telecommunications company, in its FY23 results, announced that its revenue rose to R221.06bn from R207.00bn posted in the previous year. Its diluted EPS stood at 223.00c, compared with 1,028.00c recorded in the previous year.
  • ADvTECH Limited (JO: ADHJ ): The education and recruitment company, in its annual results for the year ended 31 December 2023, reported that revenues advanced 12.9% from the preceding year to R7.86bn. Its diluted EPS stood at 173.10c, compared with 147.10c recorded in the previous year.
  • Trencor Limited (JO: TREJ ): The heavy-duty trenchers company, in its FY23 results, revealed that its operating profit stood at R87.0mn compared with a loss of R21.00mn posted in the previous year. Its diluted EPS stood at 71.50c, compared with 1.70c recorded in the corresponding period of the previous year.
  • Exxaro (JO: EXXJ ) and Thungela’s JV in peril after water use licence dispute: The future of Mafube Coal, a thermal coal mine jointly owned by Exxaro and Thungela, is in jeopardy after the department of water & sanitation declined its integrated water use licence to extend the discard facility at the complex. The joint venture has warned that, unless set aside, the decision will make it impossible to continue with mining activities.

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