Market Review, Corporate Updates, Commodities & Currencies - 05.10.21

  • Market Overview

South Africa Market Review

  • South African markets closed in the green yesterday, buoyed by gains in hotel sector stocks, following reports that the UK is preparing to remove South Africa from its red list soon.
  • Sun International (JO: SUIJ ) soared 8.3%. Mining sector companies, BHP Group (JO: BHPJ ), Kumba Iron Ore (JO: KIOJ ) and Exxaro Resources (JO: EXXJ ) advanced 2.2%, 2.1% and 1.4%, respectively.
  • Retail sector companies, Cie Financiere Richemont SA (JO: CFRJ ), Massmart Holdings (JO: MSMJ ) and Cashbuild (JO: CSBJ ) rose 2.3%, 1.1% and 0.7%, respectively.
  • On the flipside, real estate property sector stocks, Attacq (JO: ATTJ ), Capital & Counties Properties (JO: CCOJ ) and Dipula Income Fund (JO: DIBJ ) shed 2.3%, 1.6% and 1.0%, respectively.
  • Banking firms, Capitec Bank Holdings (JO: CPIJ ), FirstRand (JO: FSRJ ) and Absa Group (JO: ABGJ ) declined 1.9%, 1.7% and 1.3%, respectively.
  • The JSE All Share index advanced 0.7% to close at 64,129.00.

UK Market Review

  • The UK market finished weaker yesterday, dragged down by broad based losses in travel and leisure sector stocks.
  • InterContinental Hotels Group (LON: IHG ) and Whitbread (LON: WTB ) shed 1.8% and 1.7%, respectively.
  • Telecommunications company, BT Group (LON: BT ) declined 4.7%, following reports that Sky is closing in on a deal with Virgin Media O2 to become an investor in the telecoms operator's full-fibre broadband rollout.
  • On the flipside, pharmaceutical company, AstraZeneca (LON: AZN ) added 0.6%, after receiving a breakthrough therapy designation for its breast cancer drug, Enhertu.
  • Oil stocks, BP (LON: BP ) and Royal Dutch Shell (LON: RDSa ) rose 1.9% and 1.5%, respectively.
  • The FTSE 100 index declined 0.2% to close at 7,011.01.

US Market Review

  • US markets ended lower yesterday, dragged down by concerns over tighter inflation amid a surge in oil prices.
  • Bed Bath & Beyond (NASDAQ: BBBY ) plummeted 5.3%. Meanwhile, the company announced the launch of its Studio B home décor collection.
  • Facebook (NASDAQ: FB ) shed 4.9%, following a breakdown of its services globally, thus restricting users from its platform.
  • Moreover, one of its former employee reprimanded the company for putting its profits before the public good.
  • On the flipside, Redhill Biopharma (NASDAQ: RDHL ) soared 11.7%, after the company revealed that it had acquired new data from a Phase 2/3 clinical study assessing its tentative oral antiviral opaganib in severely ill, hospitalized COVID-19 patients.
  • The S&P 500 index fell 1.3% to settle at 4,300.46, while the DJIA index declined 0.9% to close at 34,002.92.
  • The NASDAQ index eased 2.1% to end the trading session at 14,255.48.

Asia Market Review

  • Asian markets are trading mostly lower this morning, tracking overnight losses on Wall Street.
  • In Japan, retail company, Fast Retailing (T: 9983 ) has plunged 6.6%.
  • On the contrary, oil company, Inpex Corporation (T: 1605 ) has added 4.4%.
  • In Hong Kong, pharmaceuticals company, Sino Biopharmaceutical (HK: 1177 ) has shed 4.2%.
  • On the flipside, peer, Wuxi Biologics (HK: 2269 ) has added 2.1%. In South Korea, technology companies, LG Electronics (KS: 066570 ) and Samsung Electronics (KS: 005930 ) have declined 2.8% and 2.1%, respectively.
  • On the flipside, aluminum rolling company, Choil Aluminium (KS: 018470 ) has soared 6.9%.
  • The Nikkei 225 index is trading 1.8% lower at 27,924.06.
  • The Hang Seng index has risen 0.2% to trade at 24,076.70, while the Kospi index is trading 1.5% lower at 2,975.71.

Commodities

  • At 06:00 SAST today, Brent spot prices rose 0.5% to trade at $82.10/bl, extending the previous session’s gains.
  • Yesterday, Brent spot prices rose 2.7% to settle at $81.72/bl, after OPEC+ announced that it would continue with its current policy of gradual increase in output as demand for oil rose globally.
  • Yesterday, the Illinois North Central No.2 Yellow corn spot prices fell 0.1% to $5.03/bushel.
  • At 06:00 SAST today, gold prices declined 0.4% to trade at $1,762.05/oz. Yesterday, gold gained 0.5% to close at $1,769.57/oz, as a weaker dollar boosted the demand for the safe haven yellow metal.
  • Yesterday, copper rose 1.3% to close at $9,257.50/mt. Aluminium closed 2.1% higher at $2,897.25/mt.

Currencies

  • Yesterday, the South African rand weakened against the US dollar. In the US, new orders for goods enhanced in August, indicating persistent strength in the domestic manufacturing sector, despite a slowdown in the country’s economic growth in 3Q21 following shortages of raw materials and labour constraints.
  • The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 7.71%. Further, the yield on 2023 bond advanced to 5.15%, while that for the longer-dated 2030 issue rose to 9.38%.
  • At 06:00 SAST, the US dollar is trading 0.1% higher against the South African rand at R15.0659, while the euro is trading marginally lower at R17.4851. At 06:00 SAST, the British pound has gained 0.1% against the South African rand to trade at R20.4932.
  • Yesterday, the euro advanced against most of the major currencies. In the eurozone, the European Central Bank’s (ECB) Vice-President, Luis de Guindos stated that the rise in the eurozone inflation has a structural driver in supply constraints and that the central bank is looking for an indication of wage increases.
  • At 06:00 SAST, the euro slipped 0.1% against the US dollar to trade at $1.1605, while it has weakened 0.1% against the British pound to trade at GBP0.8532.

Economic Updates

  • In Switzerland, the consumer price index ( CPI ) advanced 0.9% on a YoY basis in September, less than market expectations for a rise of 1.1%. The CPI had advanced 0.9% in the prior month.
  • Real retail sales rose 0.5% in Switzerland on an annual basis, in August. Real retail sales had fallen by a revised 2.3% in the previous month.
  • The investor confidence index eased to 16.90 in October, in the eurozone. The investor confidence index had recorded a reading of 19.60 in the prior month.
  • In August, on a MoM basis, factory orders rose 1.2% in the US, higher than market expectations of an advance of 1.0%. In the prior month, factory orders had climbed by a revised 0.7%.
  • The final durable goods orders climbed 1.8% on a monthly basis in the US, in August. Durable goods orders had recorded a revised rise of 0.5% in the previous month. The preliminary figures had also recorded an advance of 1.8%.
  • On a YoY basis, the Tokyo CPI rose 0.3% in September, Japan. In the previous month, the Tokyo CPI had dropped 0.4%.
  • In September, the final Nikkei Japan services PMI in Japan climbed to 47.80. In the previous month, Nikkei Japan services PMI had recorded a reading of 42.90. The preliminary figures had recorded an advance to 47.40.
  • Australia had registered the seasonally adjusted trade surplus of AUD15,077.00mn in August, from a trade surplus of AUD12,650.00mn in the prior month. Markets were expecting a trade surplus of AUD10,300.00mn.
  • On a MoM basis in August, the seasonally adjusted final retail sales fell 1.7% in Australia, at par with market expectations of a fall of 1.7%. The preliminary figures had also recorded a drop of 1.7%. In previous month, retail sales had dropped 2.7%.

Corporate Updates

South Africa

  • Afrimat Limited (JO: AFTJ ): The building materials supplier, in its trading statement for the period ended 31 August 2021, indicated that it expects its EPS to be between 287.60c and 296.90c, as compared with 184.40c recorded in the prior corresponding period. It expects its HEPS to be between 290.60c and 299.80c, as compared with that of 183.90c in the preceding corresponding period.
  • Oil jumps as Opec+ resists output increase: Oil rose sharply to multiyear highs after reports that oil cartel Opec+ would stick to its current output policy.

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