South Africa Market Review
- South African markets closed in the red yesterday, as investors await April consumer price inflation data and SA Reserve Bank’s interest rate decision.
- Diversified miners, African Rainbow Minerals (JO:ARIJ), Kumba Iron Ore (JO:KIOJ) and Merafe Resources (JO:MRFJ) dropped 4.7%, 3.4% and 1.7%, respectively.
- Pharmaceutical companies, Netcare (JO:NTCJ) and Mediclinic International (JO:MEIJ) eased 1.6% and 0.5%, respectively.
- On the flipside, food companies, RCL Foods (JO:RCLJ), Famous Brands (JO:FBRJ) and RFG Holdings (JO:RFGJ) advanced 3.9%, 2.9% and 2.7%, respectively.
- Retailers, Cashbuild (JO:CSBJ), Shoprite Holdings (JO:SHPJ), SPAR Group (JO:SPPJ) and Mr Price Group (JO:MRPJ) gained 2.6%, 1.9%, 1.8% and 0.9%, respectively.
- Lenders, Nedbank (JO:NEDJ), FirstRand (JO:FSRJ) and Standard Bank Group (JO:SBKJ) added 1.3%, 1.2% and 1.0%, respectively.
- The JSE All Share index declined 0.3% to close at 77,962.73.
UK Market Review
- The UK market finished firmer for the third consecutive session yesterday, supported by gains in financial sector stocks.
- Banking firms, Standard Chartered (LON:STAN) and HSBC Holdings (LON:HSBA) advanced 3.0% and 1.1%, respectively.
- NatWest Group (LON:NWG) rose 1.2%, after the UK government reduced its stake in the lender to around 38.6%.
- Insurance companies, Admiral Group (LON:ADML), Aviva (LON:AV) and Legal & General Group (LON:LGEN) gained 2.5%, 1.2% and 0.6%, respectively.
- Retailers, Ocado Group (LON:OCDO), Burberry Group (LON:BRBY), B&M European Value Retail S.A. (LON:BMEB) and Next (LON:NXT) rose 2.4%, 1.8%, 0.9% and 0.7%, respectively.
- Gaming and entertainment companies, Flutter Entertainment (LON:FLTRF) and Entain (LON:ENT) added 2.0% and 0.8%, respectively.
- The FTSE 100 index advanced 0.2% to close at 7,770.99.
US Market Review
- US markets ended mostly higher yesterday, as the US debt ceiling talks resumed.
- Pharmaceutical company, Pfizer (NYSE:PFE) climbed 5.4%, after the company’s diabetes drug in a mid-stage trial involving patients with type 2 diabetes, showed similar and faster results than peer, Novo Nordisk’s Ozempic.
- Technology companies, Alphabet (NASDAQ:GOOGL), Intel (NASDAQ:INTC), Meta and Microsoft (NASDAQ:MSFT) advanced 1.9%, 1.2%, 1.1% and 0.9%, respectively.
- On the contrary, beverages companies, PepsiCo (NASDAQ:PEP) and Coca Cola (NYSE:KO) dropped 2.7% and 2.1%, respectively.
- Energy company, Chevron Corporation (NYSE:CVX) declined 1.8%, after the company announced that it would acquire PDC Energy Inc for a consideration of $7.60bn, including debt.
- The S&P 500 index marginally rose to settle at 4,192.63, while the DJIA index declined 0.4% to close at 33,286.58.
- The NASDAQ index climbed 0.5% to end the trading session at 12,720.78.
Asia Market Review
- Asian markets are trading mostly higher this morning, amid speculation that the US might avoid a debt default.
- In Japan, automobile company, Yamaha Motor (TYO:7272) has advanced 3.0%.
- On the flipside, gaming software company, Konami Group Corporation (TYO:9766) has declined 1.3%.
- In Hong Kong, pharmaceutical company, Hansoh Pharmaceutical (HK:3692) has climbed 5.0%.
- On the other hand, internet technology company, Netease (NASDAQ:NTES) had shed 1.5%.
- In South Korea, pharmaceutical company, HanAll Biopharma (KS:009420) has surged 6.9%.
- On the contrary, security systems company, Hitron Systems (KS:019490) has plunged 9.5%.
- The Nikkei 225 index is trading 0.6% higher at 31,286.70.
- The Hang Seng index has declined 0.1% to trade at 19,657.11, while the Kospi index is trading 0.8% higher at 2,577.32.
Commodities
- At 05:30 SAST today, Brent prices rose 0.4% to trade at $76.27/bl.
- Yesterday, Brent prices rose 0.5% to settle at $75.99/bl, after the International Energy Agency (IEA) forecasted oil demand to rise in the second half of the year.
- At 05:30 SAST today, gold prices declined 0.4% to trade at $1,961.20/oz. Yesterday, gold declined 0.3% to close at $1,969.88/oz, as hawkish comments from the US Fed officials dented demand for the safe haven yellow metal.
- Yesterday, copper declined 1.6% to close at $8,093.50/mt. Aluminium closed 0.8% lower at $2,265.15/mt.
Currencies
- Yesterday, the South African rand strengthened against the US dollar.
- The yield on benchmark government bonds rose yesterday. The yield on 2026 bond rose to 9.97%. Further, the yield on the longer-dated 2030 issue rose to 11.25%.
- At 05:30 SAST, the US dollar is trading marginally higher against the South African rand at R19.2345, while the euro is trading marginally lower at R20.7873. At 05:30 SAST, the British pound has marginally declined against the South African rand to trade at R23.9067.
- Yesterday, the euro mostly advanced against most of the major currencies. In the eurozone, construction output dropped in March. Meanwhile, the region’s consumer confidence index rose less than expected in May.
- At 05:30 SAST, the euro slipped marginally against the US dollar to trade at $1.0809, while it has marginally weakened against the British pound to trade at GBP0.8695.
Economic Updates
- In the UK, the Rightmove house price index rose 1.8% on a MoM basis in May, compared to a rise of 0.2% recorded in the previous month.
- In the eurozone, seasonally adjusted construction output dropped 2.4% on a MoM basis in March, compared to a revised rise of 1.7% recorded in the previous month.
- In the eurozone, the consumer confidence index rose to a level of -17.40 in May, less than market expectations for a rise to a level of -17.00. The consumer confidence index had recorded a level of -17.50 in the previous month.
- In Japan, the Jibun Bank manufacturing PMI rose to a level of 50.80 in May, compared to a level of 49.50 recorded in the previous month.
- In Japan, the Jibun Bank services PMI unexpectedly rose to a level of 56.30 in May, compared to market expectations for a drop to a level of 55.20. The services PMI had recorded a level of 55.40 in the prior month.
- In Australia, the S&P Global manufacturing PMI remained unchanged at 48.00 in May, compared to market expectations for a drop to a level of 47.30.
- In Australia, the S&P Global services PMI dropped to a level of 51.80 in May, less than market expectations for a drop to a level of 48.90. The services PMI had recorded a level of 53.70 in the previous month.
Corporate Updates
South Africa
- Barloworld Limited (JO:BAWJ): The brand management company, in its 1H23 results, indicated that revenues rose to R20.77bn from R18.40bn posted in the corresponding period of the previous year. Its diluted EPS stood at 705.60c, compared to a loss per share of 32.50c recorded in the corresponding period of the previous year.
- Famous Brands Limited (JO:FBRJ): The food company, in its FY22 results, reported that its revenue advanced 14.9% from the same period of the preceding year to R7.40bn. Its basic EPS stood at R5.23, compared to R3.17 recorded in the corresponding period of the previous year.
- Astral Foods Limited (JO:ARLJ): The food company, in its 1H23 results, stated that revenues increased to R9.96bn from R9.43bn posted in the corresponding period of the previous year. Its diluted EPS stood at 160.00c, compared to 1,441.00c recorded in the corresponding period of the previous year.
- Netcare Limited (JO:NTCJ): The healthcare company, in its 1H2 results, indicated that revenues rose 11.9% from the same period of the preceding year to R11.54bn. Its diluted EPS stood at 45.70c, compared to 30.60c recorded in the corresponding period of the previous year.
- Oil steady amid caution about US debt ceiling talks: Oil prices were steady as caution relating to US debt ceiling talks dragged on optimism over demand later in the year and offset support from lower supplies from Canada and OPEC+ producers.