Market Review, Corporate Updates, Commodities & Currencies 14.06.2021

  • Market Overview
  • Editor's Pick

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the green on Friday, buoyed by gains in mining sector stocks.
  • Kumba Iron Ore , Anglo American (JO: AMSJ ) and BHP Group (JO: BHPJ ) advanced 2.5%, 2.1% and 2.0%, respectively.
  • Construction companies, Raubex Group and Murray & Roberts Holdings (JO: MURJ ) gained 4.3% and 0.5%, respectively.
  • Platinum miners, Royal Bafokeng Platinum (JO: RBPCBe ) and Impala Platinum (JO: IMPJ ) Holdings gained 0.5% and 0.2%, respectively.
  • On the flipside, pharmaceutical companies, Life Healthcare Group Holdings (JO: LHCJ ) and Mediclinic International (LON: MDCM ) shed 4.2% and 1.2%, respectively.
  • Banking companies, Capitec Bank Holdings (JO: CPIJ ), FirstRand (JO: FSRJ ) and Nedbank Group (JO: NEDJ ) declined 2.4%, 1.5% and 1.3%, respectively.
  • The JSE All Share index advanced 0.3% to close at 67,723.91.

UK MARKET REVIEW

  • The UK market finished firmer on Friday, after reports indicated that the British economy grew in April, thus strengthening hopes of an economic rebound.
  • Financial companies, Standard Life Aberdeen (LON: SLA ),Hargreaves Lansdown (LON: HRGV ) and Schroders (LON: SDR ) advanced 2.2%, 1.3% and 0.5%, respectively.
  • Miners, Antofagasta (LON: ANTO ), Anglo American (LON: AAL ) and BHP Group (LON: BHPB ) gained 2.1%, 1.5% and 1.4%, respectively.
  • Software companies, Micro Focus International (LON: MCRO ) and Sage Group (LON: SGE ) gained 1.7% and 0.2%, respectively.
  • On the flipside, tobacco companies, Imperial Brands (LON: IMB ) and British American Tobacco (LON: BATS ) declined 1.0% and 0.4%, respectively.
  • Beverages companies, Coca Cola HBC (LON: CCH ) and Diageo (LON: DGE ) shed 0.7%, each.
  • The FTSE 100 index advanced 0.6% to close at 7,134.06.

US MARKET REVIEW

  • US markets ended higher on Friday, buoyed by broad-based gains in financial sector stocks.
  • Wells Fargo (NYSE: WFC ) & Co., Goldman Sachs Group (NYSE: GS ), Berkshire Hathaway (NYSE: BRKa ) and Bank of America (NYSE: BAC ) gained 1.3%, 1.1%, 0.7% and 0.4%, respectively.
  • Department store company, TJX (NYSE: TJX ) rose 1.5%.
  • However, Costco Wholesale (NASDAQ: COST ) declined 0.3%. Moreover, healthcare companies, Pfizer (NYSE: PFE ) and Johnson & Johnson (NYSE: JNJ ) dropped 1.3%, each.
  • Aerospace and defence companies, Honeywell International (NASDAQ: HON ) and Boeing (NYSE: BA ) shed 0.5% and 0.4%, respectively.
  • The S&P 500 index rose 0.2% to settle at 4,247.44, while the DJIA index marginally advanced to close at 34,479.60.
  • The NASDAQ index climbed 0.4% to end the trading session at 14,069.42.

ASIA MARKET REVIEW

  • Asian markets are trading higher this morning.
  • In Japan, telecommunications company, Fujikura (T: 5803 ) has added 3.2% and electronics company, Seiko Epson (T: 6724 ) has gained 2.9%.
  • On the flipside, Sumitomo Dainippon Pharma Co Ltd (T: 4506 ) has declined 2.5% and banking company, Shinsei Bank (T: 8303 ) has shed 2.0%.
  • In South Korea, chemical manufacturing company, Dongbang Agro has plunged 13.1%.
  • Tire manufacturer, Kumho Tire (KS: 073240 ) has declined 7.0%.
  • On the other hand, technology company, LG Electronics (KS: 066570 ) has climbed 3.6%.
  • In Hong Kong, markets are closed today on account of a public holiday.
  • On Friday, the Hang Seng index closed 0.4% higher to settle at 28,842.13.
  • Today, the Nikkei 225 index is trading 0.6% firmer at 29,133.70, while the Kospi index is trading marginally higher at 3,249.89.

COMMODITIES

  • At 06:00 SAST today, Brent spot prices marginally fell to trade at $72.31/bl, reversing the previous session’s gains.
  • On Friday, Brent spot prices rose 0.7% to settle at $72.32/bl, bolstered by an improved outlook for demand as increased COVID-19 vaccinations globally help lift travel curbs. Meanwhile, Baker Hughes indicated that the number of US oil rigs rose by 6 to 365 for the week ended 11 June.
  • On Friday, the Illinois North Central No.2 Yellow corn spot prices fell 2.0% to $6.90/bushel.
  • At 06:00 SAST today, gold prices declined 0.6% to trade at $1,866.42/oz. On Friday, gold declined 1.1% to close at $1,877.53/oz, as the greenback gained ground.
  • On Friday, Copper rose 1.1% to close at $9,975.10/mt. Aluminium closed 0.9% lower at $2,464.95/mt.

CURRENCIES

  • On Friday, the South African rand weakened against the US dollar. In the US, consumer sentiment rebounded in early June as inflation fears subsided and households grew more optimistic about future economic growth and employment. Meanwhile, at the G7 meeting, the member countries aimed to end their first summit in two years with a punchy set of promises including vaccinating the world against coronavirus, making huge corporations pay their fair share of taxes and tackling climate change with a blend of technology and money.
  • The yield on benchmark government bonds mostly fell on Friday. The yield on 2026 bond fell to 7.08%. Further, the yield on 2023 bond advanced to 5.06%, while that for the longer-dated 2030 issue fell to 8.62%.
  • At 06:00 SAST, the US dollar is trading 0.1% higher against the South African rand at R13.7348, while the euro is trading 0.1% higher at R16.6164. At 06:00 SAST, the British pound has gained 0.2% against the South African rand to trade at R19.3816.
  • On Friday, the euro declined against most of the major currencies. Meanwhile, Britain’s economy gathered pace in April as the government eased its coronavirus lockdown. Moreover, UK’s manufacturing growth forecast for 2021 has been upgraded from 3.9% to 7.8%, as the country continues to recover from the onslaught of the coronavirus pandemic.
  • At 06:00 SAST, the euro slipped 0.1% against the US dollar to trade at $1.2098, while it has weakened 0.1% against the British pound to trade at GBP0.8573.

ECONOMIC UPDATES

  • The index of services in the UK advanced 3.4% on a monthly basis, in April. In the previous month, the index of services had climbed 1.9%.
  • Total trade deficit in the UK narrowed to GBP0.94bn in April. UK had registered a total trade deficit of GBP1.97bn in the prior month.
  • Construction output in the UK dropped 2.0% on a monthly basis, in April. In the prior month, construction output had advanced 5.8%.
  • In April, manufacturing production in the UK dropped 0.3% on a MoM basis, compared to market expectations of an advance of 1.5%. In the previous month, manufacturing production had recorded a rise of 2.1%.
  • Industrial production in the UK registered a drop of 1.3% on a monthly basis in April, compared to an advance of 1.8% in the previous month. Market expectations were for industrial production to rise 1.2%.
  • On a MoM basis, gross domestic product (GDP) in the UK rose 2.3% in April, more than market expectations for a rise of 2.2%. GDP had climbed 2.1% in the previous month.
  • In May, on a MoM basis, the wholesale price index registered a rise of 1.7% in Germany. In the previous month, the wholesale price index had registered a rise of 1.1%.
  • The final consumer price index in Spain recorded a rise of 0.5% in May on a monthly basis, higher than market expectations of an advance of 0.4%. In the previous month, the consumer price index had registered a rise of 1.2%. The preliminary figures had indicated a rise of 0.4%.
  • In June, the preliminary Reuters/ Michigan consumer sentiment index recorded a rise to 86.40 in the US, more than market expectations for an advance to 84.00. In the previous month, the Reuters/Michigan consumer sentiment index had registered a reading of 82.90.
  • Capacity utilization registered a rise to 81.7% in Canada, in 1Q21, more than market expectations for an advance to a level of 80.6%. In the previous quarter, capacity utilization had registered a revised level of 79.7%.
  • In 2Q21, on a quarterly basis, business survey index (BSI) of large manufacturing industries recorded a drop of 1.4% in Japan. In the prior quarter, BSI of large manufacturing industries had advanced 1.6%.

CORPORATE UPDATES

SOUTH AFRICA

  • Omnia (JO: OMNJ ) Holdings Limited: The chemical manufacturing company, in its FY21 trading statement, indicated that its EPS is expected to be between 816.00c and 836.00c and HEPS is expected to be in the range of 352.00c to 390.00c.
  • Oil rises to fresh multiyear highs as world eases pandemic curbs: Oil prices rose to fresh multiyear highs and were set for their third weekly jump on expectations of a recovery in fuel demand in Europe, China and the US as rising vaccination rates lead to an easing of pandemic curbs.

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