SOUTH AFRICA MARKET REVIEW
- South African markets closed in the green yesterday, buoyed by gains in consumer staple and mining sector stocks.
- Food companies, RFG Holdings (JO:RFGJ) and Famous Brands (JO:FBRJ) jumped 11.7% and 1.2%, respectively.
- Diversified miners, Pan African Resources (JO:PANJ), Exxaro Resources (JO:EXXJ) and Kumba Iron Ore (JO:KIOJ) advanced 3.0%, 1.4% and 0.9%, respectively.
- Gold miners, AngloGold Ashanti (JO:ANGJ), Harmony Gold Mining Company (JO:HARJ) and Gold Fields (JO:GFIJ) gained 2.8%, 2.7% and 0.5%, respectively.
- On the flipside, telecommunications companies, Blue Label Telecoms (JO:BLUJ) and MTN Group (JO:MTNJ) dropped 3.1% and 1.3%, respectively.
- Platinum miners, Impala Platinum (JO:IMPJ), Northam Platinum (JO:NPHJ) and Anglo American Platinum (JO:AMSJ) declined 2.5% 1.9% and 0.7%, respectively.
- The JSE All Share index advanced 0.3% to close at 84,239.44.
UK MARKET REVIEW
- The UK market finished firmer yesterday, led by gains in travel and mining sector stocks.
- Travel and leisure companies, Whitbread (LON:WTB), InterContinental Hotels Group (LON:IHG) and International Consolidated Airlines Group S.A. (LON:ICAG) advanced 3.7%, 1.1% and 0.7%, respectively.
- Miners, Antofagasta (LON:ANTO), Fresnillo (LON:FRES) and Rio Tinto (LON:RIO) gained 1.9%, 1.5% and 0.8%, respectively.
- Banking firms, NatWest Group (LON:NWG), Standard Chartered (LON:STAN) and Barclays (LON:BARC) rose 1.5%, 1.2% and 1.0%, respectively.
- Retailers, B&M European Value Retail S.A. (LON:BMEB), Tesco (LON:TSCO) and JD Sports Fashion (LON:JD) added 1.4%, 1.2% and 0.6%, respectively.
- On the other hand, real estate companies, London Metric Property and Barratt Developments (LON:BDEV) dropped 2.1% and 1.4%, respectively.
- The FTSE 100 index advanced 0.4% to close at 8,379.64.
US MARKET REVIEW
- US markets ended mostly lower on Friday, as gains from optimistic domestic economic data was capped by Nvidia’s disappointing revenue forecast.
- Departmental store chains, Dollar Tree (NASDAQ:DLTR) and Target Corporation (NYSE:TGT) plunged 10.2% and 2.2%, respectively.
- Media and entertainment companies, Warner Bros Discovery (NASDAQ:WBD) and Paramount Global (NASDAQ:PARA) shed 3.0% and 2.2%, respectively.
- On the contrary, technology companies, Intel Corporation (NASDAQ:INTC), Apple (NASDAQ:AAPL) and Cisco Systems (NASDAQ:CSCO) advanced 2.7%, 1.5% and 1.1%, respectively.
- Financial services companies, Goldman Sachs Group (NYSE:GS) and American Express (NYSE:AXP) gained 1.4% and 1.1%, respectively.
- The S&P 500 index marginally fell to settle at 5,591.96, while the DJIA index advanced 0.6% to close at 41,335.05.
- The NASDAQ index eased 0.2% to end the trading session at 17,516.43.
ASIA MARKET REVIEW
- Asian markets are trading higher this morning. In Japan, steel company, Japan Steel Works (TYO:5631) has advanced 3.2%.
- On the flipside, internet advertising company, CyberAgent (TYO:4751) has declined 2.0%.
- In Hong Kong, real estate company, Longfor Group Holdings (HK:0960) has jumped 3.5%.
- On the other hand, pharmaceutical company, Hansoh Pharmaceutical (HK:3692) has eased 0.7%.
- In South Korea, chemical company, Hannong Chemicals (KS:011500) has surged 8.7%.
- On the contrary, paper company, HanChang Paper (KS:005110) has shed 3.5%.
- The Nikkei 225 index is trading 0.6% higher at 38,585.43.
- The Hang Seng index has gained 1.3% to trade at 18,024.25, while the Kospi index is trading 0.6% higher at 2,677.44.
COMMODITIES
- At 05:30 SAST today, Brent prices rose 0.2% to trade at $80.12/bl.
- Yesterday, Brent prices rose 1.6% to settle at $79.94/bl, amid concerns over supply disruptions in Libya and planned output cuts by Iraq.
- At 05:30 SAST today, gold prices declined 0.3% to trade at $2,514.20/oz. Yesterday, gold gained 0.8% to close at $2,521.18/oz, boosted by growing anticipation of Federal Reserve rate cuts in September.
- Yesterday, copper declined 0.2% to close at $9,115.85/mt. Aluminium closed 1.1% lower at $2,457.35/mt.
CURRENCIES
- Yesterday, the South African rand strengthened against the US dollar. In South Africa, the producer price index (PPI) eased in July, helped by lower fuel prices. In the US, gross domestic product (GDP) grew more than expected in 2Q24. Meanwhile, the number of people filing for initial jobless claims fell more than expected in the week ended 23 August 2024. Moreover, pending home sales unexpectedly dropped in July.
- The yield on benchmark bonds were lower yesterday. The yield on the 2034 generic bond fell to 10.52%, while that for the longer dated 2044 generic issue declined to 11.19%
- At 05:30 SAST, the US dollar is trading slightly higher against the South African rand at R17.7643, while the euro is trading slightly higher at R19.6710. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.3831.
- Yesterday, the euro declined against most of the major currencies. In Germany, consumer price inflation dropped to its lowest since early 2021, boosting chances of a September ECB rate cut.
- At 05:30 SAST, the euro slightly slipped against the US dollar to trade at $1.1075, while it has marginally weakened against the British pound to trade at GBP0.8413.
ECONOMIC UPDATES
- In South Africa, the producer price index (PPI) eased 0.2% on a MoM basis in July, compared to a drop of 0.3% recorded in the previous month.
- In South Africa, the PPI climbed 4.2% on a YoY basis in July, compared to a rise of 4.6% recorded in the previous month.
- In Spain, the consumer price index (CPI) recorded a flat reading on a MoM basis in August, compared to a drop of 0.5% recorded in the previous month.
- In Germany, the CPI unexpectedly declined 0.1% on a MoM basis in August, compared to a rise of 0.3% recorded in the previous month.
- In the eurozone, the business climate index fell to a level of -0.62 in August, compared to a level of -0.61 recorded in the prior month.
- In the eurozone, the consumer confidence index dropped to a level of -13.50 in August, more than market expectations for a fall to a level of -13.40. The consumer confidence index had recorded a level of -13.00 in the prior month.
- In the eurozone, the economic sentiment index unexpectedly rose to a level of 96.60 in August, compared to a revised level of 96.00 recorded in the previous month.
- In the US, goods trade deficit widened to $102.70bn in July, compared to a deficit of $97.40bn recorded in the previous month.
- In the US, the annualized gross domestic product (GDP) rose 3.0% in 2Q24, more than market expectations for a rise of 2.8%. The annualized GDP had advanced 2.8% in the prior quarters.
- In the US, initial jobless claims fell to a level of 231.00K in the week ended 23 August 2024, more than market expectations for a drop to a level of 232.00K. Initial jobless claims had recorded a revised level of 233.00K in the previous week.
- In the US, pending home sales unexpectedly dropped 5.5% on a MoM basis in July, compared to a rise of 4.8% recorded in the prior month.
- In Canada, current account deficit widened to C$8.48bn in 2Q24, compared to a deficit of C$5.37bn recorded in the previous quarter.
- In Japan, the CPI rose 2.6% on a YoY basis in August, compared to a rise of 2.2% recorded in the previous month.
- In Japan, the unemployment rate rose to 2.7% in July, compared to 2.5% recorded in the prior month.
- In Japan, industrial production advanced 2.7% on a YoY basis in July, compared to a drop of 7.9% recorded in the previous month.
- In Japan, retail sales rose 2.6% on a YoY basis in July, less than market expectations for a rise of 2.9%. Retail sales had recorded a rise of 3.7% in the prior month.
CORPORATE UPDATES
SOUTH AFRICA
- Sanlam Limited (JO:SLMJ): The insurance company, in its 1H24 trading update, revealed that the group achieved strong growth in net result from financial services (NRFFS) and cash NRFFS across all lines of business with notable contributions from life insurance and general insurance. Life insurance benefited from robust results achieved in the Pan-Africa operations while general insurance experienced improved performance from Santam. EPS is expected to be 15.0% to 25.0%, higher as compared with 389.00c recorded in the prior year. Moreover, it expects HEPS to be 35.0% to 45.0%, higher as compared with 339.00c recorded in the previous year.
- South32 (JO:S32J) Limited: The mining and metals company, in its FY24 results, revealed that its revenue from continuing operations fell 3.0% from the preceding year to $5.48bn. Its basic loss per share stood at 4.50 US cents, compared with 3.80 US cents recorded in the previous year. Separately, the company announced that the sale of Illawarra Metallurgical Coal to an entity owned by Golden Energy and Resources and M Resources was successfully completed on 29 August 2024.
- Impala Platinum Holdings Limited (JO:IMPJ): The platinum mining company, in its annual results for the year ended 30 June 2024, reported that its revenue fell to R86.40bn from R106.59bn posted in the previous year. Its diluted loss per share stood at 1,924.00c, compared with an EPS of 575.00c recorded in the previous year.
- Santam Limited (JO:SNTJ): The financial services company, in its 1H24 results, stated that its insurance revenue increased to R24.63bn from R22.49bn posted in the corresponding period of the previous year. Its diluted EPS rose 34.1% from the same period of the prior year to 1,553.00c.
- Fortress Real Estate Investments Limited: The real estate investment trust company, in its FY24 results, posted total revenues of R4.38bn, higher as compared with R3.79bn posted in the corresponding period of the previous year. Its diluted EPS rose 30.8% from the same period of the prior year to 365.67c.
- Blue Label Telecoms Limited (JO:BLUJ): The telecommunications company, in its FY24 results, reported revenues of R14.18bn, 23.8% lower from the preceding year. Its diluted EPS climbed to 72.03c, compared with 30.07c recorded in the previous year.
- Standard Bank (JO:SBKJ) backs its R11bn tech investment push: Standard Bank continues its investment push in technology, reporting a 28.0% increase in digital transactions while containing cost growth at just 2.0%. This is after spending R11.00bn in the first half of 2024.