South Africa Market Review
- South African markets closed in the green yesterday, as a better than expected US economic data eased fear that recession is inevitable.
- Retailers, Steinhoff International Holdings (JO: SNHJ ), Cashbuild (JO: CSBJ ), Lewis Group (JO: LEWJ ) and SPAR Group (JO: SPPJ ) advanced 4.5%, 4.3%, 1.4% and 1.0%, respectively.
- Property dealers, Capital & Counties Properties (JO: CCOJ ), NEPI Rockcastle SA (JO: NRPJ ) and Growthpoint Properties (JO: GRTJ ) gained 2.6%, 1.5% and 1.0%, respectively.
- Pharmaceutical companies, Life Healthcare Group (JO: LHCJ ), Netcare (JO: NTCJ ) and Adcock Ingram (JO: AIPJ ) added 1.9%, 1.7% and 1.0%, respectively.
- On the other hand, gold miners, AngloGold Ashanti (JO: ANGJ ), Harmony Gold Mining (JO: HARJ ) and Gold Fields (JO: GFIJ ) declined 4.1%, 4.0% and 3.8%, respectively.
- Platinum miners, Impala Platinum (JO: IMPJ ) and Northam Platinum (JO: NHMJ ) shed 1.8% and 0.8%, respectively.
- The JSE All Share index advanced 0.9% to close at 68,610.57.
- The UK market finished firmer yesterday, boosted by a surge in shares of Avast Group (LON: AVST ) as well as gains in retail and banking sector stocks. Cybersecurity company, Avast surged 43.7%, after Britain's competition regulator said that it has provisionally cleared cybersecurity firm NortonLifeLock's $8.60bn purchase of the rival company.
- Taylor Wimpey (LON: TW ) gained 5.5%, after the homebuilder forecasted robust annual operating profit.
- Retailers, Ocado (LON: OCDO ), JD Sports Fashion (LON: JD ), Burberry Group (LON: BRBY ) and B&M European Value Retail (LON: BMEB ) advanced 4.9%, 2.6%, 1.8% and 1.3%, respectively.
- Real estate companies, Barratt Developments (LON: BDEV ) and Berkeley Group Holdings (LON: BKGH ) gained 2.5% and 2.3%, respectively.
- Banks, Standard Chartered (LON: STAN ), Barclays (LON: BARC ) and HSBC Holdings (LON: HSBA ) added 2.5%, 2.1% and 1.7%, respectively.
- The FTSE 100 index advanced 0.5% to close at 7,445.68.
US Market Review
- US markets ended higher yesterday, buoyed by upbeat corporate earnings and domestic economic data.
- Pharmaceutical company, Moderna (NASDAQ: MRNA ) soared 16.0%, after it reported upbeat 2Q22 revenue and announced that it expects to deliver $21.00bn worth of COVID 19 vaccines in FY22.
- Financial technology company, PayPal Holdings (NASDAQ: PYPL ) surged 9.3%, after it reported better than expected revenues and earnings in 2Q22 and announced $15.00bn share repurchasing programme.
- Under Armour (NYSE: UAA ) advanced 2.6%, after the apparel company reported upbeat revenues in 1Q23. The S&P 500 index rose 1.6% to settle at 4,155.17, while the DJIA index advanced 1.3% to close at 32,812.50.
- The NASDAQ index climbed 2.6% to end the trading session at 12,668.16.
Asia Market Review
- Asian markets are trading higher this morning, tracking overnight gains on Wall Street.
- In Japan, transportation company, Kawasaki Kisen Kaisha (TYO: 9107 ) has advanced 4.0%.
- On the flipside, chemical manufacturing company, Mitsubishi Chemical Group (TYO: 4188 ) has declined 3.8%.
- In Hong Kong, automotive company, Geely Automobile Holdings (HK: 0175 ) has gained 3.7%.
- On the other hand, resort company, Sands China (HK: 1928 ) has dropped 3.4%.
- In South Korea, banking and financial technology company, KakaoBank Corporation (KS: 323410 ) has advanced 4.9%.
- On the contrary, steel manufacturing company, TCC Steel Corporation (KS: 002710 ) has dropped 4.1%.
- The Nikkei 225 index is trading 0.6% higher at 27,895.01.
- The Hang Seng index has advanced 1.4% to trade at 20,045.32, while the Kospi index is trading 0.2% higher at 2,467.10.
- At 06:00 SAST today, Brent spot prices rose 0.1% to trade at $99.44/bl, reversing previous sessions losses.
- Yesterday, Brent spot prices fell 3.2% to settle at $99.35/bl, following a surge in US crude oil inventories and after OPEC+ announcement that it will raise oil output target by 0.10mn bpd. The US Energy Information Administration (EIA) reported that US crude inventories advanced by 4.47mn bls in the week ended 29 July 2022.
- Yesterday, the Illinois North Central No.2 Yellow corn spot prices marginally rose to $6.44/bushel.
- At 06:00 SAST today, gold prices advanced 0.3% to trade at $1,770.94/oz. Yesterday, gold gained 0.3% to close at $1,765.29/oz, as a weaker dollar boosted demand for the safe haven yellow metal.
- Yesterday, copper declined 1.8% to close at $7,671.75/mt. Aluminium closed 1.7% lower at $2,379.85/mt.
- Yesterday, the South African rand strengthened against the US dollar. In the US, services industry accelerated in June, due to an increased business activity and solid new orders. Moreover, new factory orders increased in June, as businesses reported a rise in exports. Furthermore, ISM services employment index increased in July, depicting strong labour market constraints.
- The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 8.99%. Further, the yield on the longer-dated 2030 issue rose to 10.33%.
- At 06:00 SAST, the US dollar is trading 0.1% lower against the South African rand at R16.7405, while the euro is trading 0.1% lower at R17.0216. At 06:00 SAST, the British pound has marginally declined against the South African rand to trade at R20.3457.
- Yesterday, the euro mostly advanced against most of the major currencies. In the eurozone, retail sales dropped in June, adding to recessionary fears. Meanwhile, services activity continued to rise, but growth slowed to its weakest since the Omicron-related disruption at the start of the year.
- At 06:00 SAST, the euro marginally advanced against the US dollar to trade at $1.0167, while it has marginally weakened against the British pound to trade at GBP0.8366.
- The final services PMI fell to a level of 52.60 in the UK, in July, more than market expectations for a fall to 53.30. The services PMI had registered a reading of 54.30 in the previous month. The preliminary figures had recorded a drop to 53.30.
- In July, the consumer price index (CPI) in Switzerland recorded a rise of 3.4% on a YoY basis, compared with a similar rise of 3.4% in the previous month. Market anticipations were for the CPI to advance 3.5%.
- The services PMI dropped to 53.80 in Spain, in July, lower than market expectations of a drop to 52.00. In the prior month, the services PMI had recorded a level of 54.00.
- The seasonally adjusted retail sales in Italy registered a drop of 1.1% in June on a MoM basis. Retail sales had advanced 1.9% in the previous month.
- In Italy, the services PMI registered a drop to 48.40 in July, compared with a reading of 51.60 in the previous month. Markets were anticipating the services PMI to ease to 50.10.
- The final services PMI eased to 53.20 in France, in July, lower than market expectations of a fall to 52.10. Services PMI had registered a level of 53.90 in the prior month. The preliminary figures had indicated a drop to 52.10.
- The final services PMI registered a drop to 49.70 in Germany, in July, compared with a reading of 52.40 in the previous month. The preliminary figures had indicated a fall to 49.20. Markets were anticipating services PMI to fall to 49.20.
- The final services PMI fell to a level of 51.20 in July, in the eurozone, compared with a reading of 53.00 in the previous month. The preliminary figures had indicated a drop to 50.60. Markets were anticipating services PMI to ease to 50.60.
- In June, the producer price index (PPI) climbed 35.8% in the eurozone on a YoY basis, more than market expectations for an advance of 35.7%. In the prior month, the PPI had risen by a revised 36.2%.
- Retail sales in the eurozone dropped 1.2% on a MoM basis in June, compared with a revised advance of 0.4% in previous month. Market expectations were for the seasonally adjusted retail sales to record an unchanged reading 0.0%.
- On a weekly basis, the number of mortgage applications rose 1.2% in the week ended 29 July 2022, in the US. In the previous week, the number of mortgage applications had fallen 1.8%.
- The final Markit services PMI recorded a drop to 47.30 in July, in the US, lower than market expectations of a drop to 47.00. In the previous month, Markit services PMI had recorded a reading of 52.70. The preliminary figures had recorded a drop to 47.00.
- In July, the ISM Services Index advanced unexpectedly to a level of 56.70 in the US, against market expectations of a drop to 54.00.
- In the US, the final durable goods orders (ex transportation) advanced 0.4% in June, on a monthly basis. Durable goods orders (ex transportation) had advanced by a revised 0.3% in the previous month. The preliminary figures had recorded an advance of 0.3%.
- Factory orders in the US recorded a rise of 2.0% in June on a monthly basis, more than market expectations for a rise of 1.1%. Factory orders had registered a revised rise of 1.8% in the previous month.
- Caxton and CTP Publishers and Printers Limited (JO: CATJ ): The company announced that its subsidiary CTP Limited had concluded an agreement for the acquisition of the Amcor Cape Town Bag in Box and Pouching operations and the Amcor Port Elizabeth operations in South Africa of Amcor Flexibles South Africa Proprietary Limited, subject to approval of the competition authorities. The acquisition has now been implemented with effect from 1 August 2022.
- Young creatives are pioneering new digital careers — and Standard Bank’s got their backs: Digital technology platforms are giving rise to many new occupations and opportunities in a low-growth economy. Young creatives are finding and taking advantage of the many entrepreneurial opportunities that it offers. Video content creation has become one of the popular choices for these platforms.
- Old Mutual buys stake in SME lender Preference Capital: Old Mutual (JO: OMUJ ) has agreed to buy a minority stake in Preference Capital, a specialist provider of funding solutions to the small and medium enterprise (SME) market.
- Absa suggests profit growth of at least a quarter amid pick-up in loans: Absa (JO: ABGJ ), SA’s fourth biggest bank by market value, has flagged profit growth of at least a quarter for its half-year to end-June, having indicated that easing Covid-19 restrictions proved supportive for loan growth.
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