Market Review, Commodities, Currencies, Economic & Corporate Update - 28.11.23

  • Market Overview

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the red yesterday, led by losses in real estate and retail sector stocks.
  • Homebuilding companies, Attacq (JO: ATTJ ), Fortress REIT (JO: FFAJ ) and Growthpoint Properties (JO: GRTJ ) shed 4.1%, 2.9% and 1.2%, respectively.
  • Retailers, Mr Price Group (JO: MRPJ ), Lewis Group (JO: LEWJ ) and Pick n Pay Stores (JO: PIKJ ) declined 2.7%, 2.2% and 1.7%, respectively.
  • On the flipside, platinum miners, Anglo American Platinum (JO: AMSJ ), Northam Platinum (JO: NPHJ ) and Impala Platinum Holdings (JO: IMPJ ) gained 6.3%, 3.8% and 3.4%, respectively.
  • Fishing company, Oceana Group (JO: OCEJ ) jumped 3.2%, after the company reported a 22% surge in its annual revenue.
  • Gold mining companies, AngloGold Ashanti (JO: ANGJ ), Gold Fields (JO: GFIJ ) and Harmony Gold Mining (JO: HARJ ) advanced 2.4%, 2.1% and 1.7%, respectively.
  • The JSE All Share index declined 0.5% to close at 75,369.88.

UK MARKET REVIEW

  • The UK market finished weaker yesterday, weighed down by losses in mining sector stocks.
  • Insurance companies, St. James's Place (LON: SJP ), Old Mutual (LON: OMU ) (JO: OMUJ ) and Prudential (LON: PRU ) shed 2.4%, 2.1% and 1.4%, respectively.
  • Pharmaceutical companies, AstraZeneca (LON: AZN ) and GSK (LON: GSK ) fell 2.0% and 0.6%, respectively.
  • Banks, Lloyds Banking Group (LON: LLOY ) and NatWest (LON: NWG ) each declined 1.0%.
  • Aerospace and defence company, BAE Systems (LON: BAES ) shed 1.7%. Peer, Rolls-Royce Holdings (LON: RR ) added 0.9%.
  • On the contrary, real estate companies, Barratt Developments (LON: BDEV ) and Taylor Wimpey (LON: TW ) gained 1.3% and 1.0%, respectively.
  • The FTSE 100 index dropped 0.4% to close at 7,460.70.

US MARKET REVIEW

  • US markets closed lower yesterday, ahead of key US inflation data.
  • Pharma retail companies, Walgreens Boots Alliance (NASDAQ: WBA ) and CVS Health Corporation (NYSE: CVS ) dropped 3.6% and 1.0%, respectively.
  • Homebuilding companies, D.R. Horton (NYSE: DHI ) and Lennar Corporation (NYSE: LEN ) declined 1.0% and 1.1%, respectively.
  • Media and entertainment companies, Walt Disney (NYSE: DIS ) and Warner Bros Discovery (NASDAQ: WBD ) eased 0.9% and 0.7%, respectively.
  • Energy companies, Devon Energy Corporation (NYSE: DVN ) and Exxon Mobil Corporation (NYSE: XOM ) fell 0.9% and 0.6%, respectively.
  • The S&P 500 index fell 0.2% to settle at 4,550.43, while the DJIA index declined 0.2% to close at 35,333.47.
  • The NASDAQ index eased 0.1% to end the trading session at 14,241.02.

ASIA MARKET REVIEW

  • Asian markets are trading mostly lower this morning, tracking overnight losses on Wall Street.
  • In Japan, automobile company, Mazda Motor Corporation (TYO: 7261 ) has shed 2.7%.
  • On the flipside, optical instruments company, Nikon Corporation (TYO: 7731 ) has advanced 2.0%.
  • In Hong Kong, electronic company, Lenovo Group (HK: 0992 ) has added 1.5%.
  • On the other hand, Meituan (HK: 3690 ) has shed 3.7%.
  • In South Korea, pharmaceutical company, Kyongbo Pharmaceutical (KS: 214390 ) has gained 3.2%.
  • On the contrary, semiconductor company, LX Semicon (KS: 108320 ) has shed 2.5%.
  • The Nikkei 225 index is trading 0.2% lower at 33,370.40.
  • The Hang Seng index is trading 0.7% lower to trade at 17,410.23, while the Kospi index is trading 0.7% higher at 2,513.01.

COMMODITIES

  • At 05:30 SAST today, Brent prices rose 0.2% to trade at $80.14/bl.
  • Yesterday, Brent prices fell 0.7% to settle at $79.98/bl, ahead of the OPEC+ meeting.
  • At 05:30 SAST today, gold prices advanced 0.1% to trade at $2,015.56/oz. Yesterday, gold gained 0.6% to close at $2,013.64/oz, as a weaker dollar boosted demand for the safe haven precious metal.
  • Yesterday, copper declined 0.6% to close at $8,280.35/mt. Aluminium closed 0.3% lower at $2,211.65/mt.

CURRENCIES

  • Yesterday, the South African rand strengthened against the US dollar. In the US, new home sales fell in October, as high mortgage rates weighed on demand. Moreover, the Dallas Fed manufacturing business index dropped in November.
  • The yield on benchmark government bonds fell yesterday. The yield on the 2030 bond dropped to 10.15% while that for the longer-dated 2040 issue eased to 12.32%.
  • At 05:30 SAST, the US dollar is trading 0.1% lower against the South African rand at R18.6281, while the euro is trading 0.1% lower at R20.4084. At 05:30 SAST, the British pound has declined 0.1% against the South African rand to trade at R23.5327.
  • Yesterday, the euro weakened against most of the major currencies.
  • At 05:30 SAST, the euro marginally advanced against the US dollar to trade at $1.0959, while it has marginally weakened against the British pound to trade at GBP0.8673.

ECONOMIC UPDATES

  • In the UK, the BRC shop price index advanced to 4.3% on a YoY basis in October, compared to 5.2% in the prior month.
  • In the US, new home sales dropped 5.6% on a MoM basis in October. New home sales had registered a revised rise of 8.6% in the previous month.
  • In the US, the Dallas Fed manufacturing business index dropped to a level of -19.90 in November. The Dallas Fed manufacturing business index had recorded a reading of -19.20 in the prior month.
  • In Australia, seasonally adjusted retail sales eased 0.2% on a MoM basis in October, compared to a rise of 0.9% registered in the previous month.

CORPORATE UPDATES

SOUTH AFRICA

  • Standard Bank Group Limited (JO: SBKJ ): The banking company, in its voluntary trading update for the ten months to 31 October 2023, announced that banking revenue growth has slowed but remained above 20% period on period, driven by continued strong net interest income and non-interest revenue growth. Non-interest revenue growth was low-to-mid teens period on period, supported by ongoing client acquisition, higher transaction volumes, annual price increases, and continued volatility which supported trading revenues.
  • Tsogo Sun Limited (JO: TSGJ ): The hotel and entertainment company, in its results for the six months ended 30 September 2023, announced that its income rose 7.2% to R5.86bn from the same period of the prior year. Its basic and diluted EPS advanced to 85.90c from 64.10c recorded in the corresponding period of the previous year.
  • Oceana Group Limited (JO: OCEJ ): The food processing company, in its FY23 results, indicated that its revenue advanced to R9.99bn from R8.15bn reported in the prior year. Its diluted EPS stood at 802.20c compared to 622.50c posted in the previous year. Further, the company announced the extension of Neville Brink’s tenure as Chief Executive Officer (CEO) to 31 December 2026.
  • Invicta Holdings Limited (JO: IVTPp ): The industrial supplies company, in its 1H24 results, stated that revenues rose 12.0% to R4.29bn from the same period of the prior year. Its diluted EPS stood at 303.00c compared to 271.00c reported in the same period of the previous year.

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