The local bourse followed weaker global markets on Thursday, while the rand ended its three-day winning streak, despite another report showing that inflation had eased in the US. The FTSE/JSE All Share Index fell by 0.87% to 76 382 points. Investors are now focused on the first sitting of the new National Assembly today, where the new President will be elected, and are anticipating more clarity on the formation of formal agreement between various political parties for a government of national unity (GNU).The rand was trading at R18.44/$ at 17h50.
The S&P 500 and Nasdaq ended Thursday at new record highs for the fourth session in a row, with increases of 0.20% and 0.30% respectively, while the Dow Jones dropped 65 points. Investors were balancing cooler-than-anticipated inflation data against the Federal Reserve's reduced expectations for rate cuts. The most recent PPI report showed a continued decrease in inflationary pressures, raising the likelihood of multiple rates cuts this year.
The FTSE 100 dropped by 0.70% on Thursday, undoing the previous day's 0.80% gain, reflecting losses in other European markets amid concerns over the rise of far-right parties in Europe. In France, Le Pen’s National Rally is leading in the polls ahead of the 30 June 2024 elections.
The Hang Seng increased by 175 points, or nearly 1% on Thursday, mostly recovering from a 1.30% drop in the prior session as most sectors gained. Meanwhile, Beijing announced it would take measures to protect its interests after the European Commission decided to impose additional duties of up to 38.10% on imported Chinese electric cars starting in July. The Nikkei fell by 0.40%, reversing gains from earlier in the session, as caution prevailed ahead of the Bank of Japan’s policy decision at the end of the week.
In the commodity markets, gold decreased by 0.93% to $2 298.95 per ounce while WTI crude futures fell toward $78 per barrel in a likely technical correction, but were still on track to gain more than 3% for the week as a robust global demand outlook outweighed market uncertainties on the timing and scale of US rate cuts, according to Trading Economics.
