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In our continued efforts to give our readers a broad number of views, opinions and information, we continue to provide PSG's daily market updates and add our own daily inputs in at the end.
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Short summary of PSG's market commentary for 18 November 2019
South Africa
The JSE closed lower on Friday, with global sentiment boosted by comments from US White House economic adviser Larry Kudlow, who said the US and China were down to the final steps of agreeing on a “phase one” trade deal. The JSE closed down by 0.32%.
United States
Wall Street’s main stock indexes closed at record levels on Friday, fuelled by fresh optimism over a potential calming of US-China trade tensions and by big gains in shares of healthcare companies. The Dow breached 28 000 for the first time on Friday.
Europe
European shares logged gains on Friday following record highs on Wall Street after bullish comments from a White House official on US-China trade talks. The pan-European STOXX 600 index rose 0.40%.
Hong Kong
Hong Kong stocks ended flat on Friday on concerns over the persistent political unrest and uncertainty around a Sino-US trade deal. The Hang Seng index was unchanged at 26 326.66.
Japan
Japanese stocks rebounded on Friday as White House comments that Washington and Beijing were close to striking a trade deal sparked buying in cyclical and financials. The Nikkei rose 0.70%.
Rand
The rand was stronger on Friday as talks of an impending deal between the US and China over trade was mooted. At 18h00, the rand was trading R14.70 to the US dollar.
Precious metals
Gold prices fell on Friday as a White House official's comments rekindled hopes of a US-China trade deal and boosted appetite for riskier assets. The price of gold fell by 0.58%, trading at $1 464.40 per ounce at 18h40.
Oil
Oil prices fell on Friday fuelled by concerns about rising supplies next year, although losses were checked by signs of progress towards ending the US-China trade row. Brent crude traded at $61.85 a barrel at 18h40.
The JSE closed lower on Friday, with global sentiment boosted by comments from US White House economic adviser Larry Kudlow, who said the US and China were down to the final steps of agreeing on a “phase one” trade deal. The JSE closed down by 0.32%.
United States
Wall Street’s main stock indexes closed at record levels on Friday, fuelled by fresh optimism over a potential calming of US-China trade tensions and by big gains in shares of healthcare companies. The Dow breached 28 000 for the first time on Friday.
Europe
European shares logged gains on Friday following record highs on Wall Street after bullish comments from a White House official on US-China trade talks. The pan-European STOXX 600 index rose 0.40%.
Hong Kong
Hong Kong stocks ended flat on Friday on concerns over the persistent political unrest and uncertainty around a Sino-US trade deal. The Hang Seng index was unchanged at 26 326.66.
Japan
Japanese stocks rebounded on Friday as White House comments that Washington and Beijing were close to striking a trade deal sparked buying in cyclical and financials. The Nikkei rose 0.70%.
Rand
The rand was stronger on Friday as talks of an impending deal between the US and China over trade was mooted. At 18h00, the rand was trading R14.70 to the US dollar.
Precious metals
Gold prices fell on Friday as a White House official's comments rekindled hopes of a US-China trade deal and boosted appetite for riskier assets. The price of gold fell by 0.58%, trading at $1 464.40 per ounce at 18h40.
Oil
Oil prices fell on Friday fuelled by concerns about rising supplies next year, although losses were checked by signs of progress towards ending the US-China trade row. Brent crude traded at $61.85 a barrel at 18h40.
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Our daily update
Last week Friday we covered the lastest weekly market wrap from Peregrine Treasury Services. Below a short extract from that article
SA BUCKLING UNDER SOE STRESSES
On the South African front, a relatively calm week was seen politically, with more focus being placed on foundational issues within the country such as government’s involvement in Eskom, SAA and Telkom. With Eskom finding itself on the wrong side of media headlines this year, this week it continued to underwhelm the market as questions over when or whether a new CEO will be appointed flooded headlines. Missing their promised deadline by the end of October, Eskom now sits halfway through November without a CEO as the political tussle for the position carries on in the undertow.
With approximately 3,000 employees and members of the African Cabin Crew Association (SACCA) and the National Union of Metalworkers of South Africa (NUMSA) looking to strike at SAA from Friday 15 November, the company finds itself in dire straits. With employees demanding an 8% salary increase amidst a company restructure that could see 944 jobs being lost, tensions were running on high on Thursday. SAA had initially offered to increase salaries by 5.9%, however the Union and employees weren’t amused. Thursday afternoon saw SAA announcing that they could look at offering another number at some point during the day.
When looking at South African data, retail sales came in extremely flat, both month-on-month and year-on-year while mining production numbers surprised to the upside in September, mainly on the back of and 8.2% expansion in iron ore production. The rand unfortunately gave way to the strengthening of the US dollar this week, losing around 1.7% between Monday and Thursday, slipping from R14.75/$ to R15.00. The rand did tend to scrape back some losses against the USD after the stronger-than-expected mining production numbers. The possibility of a new SAA offer to the unions may have added a further strengthening impetus to the rand.
Read the full article here
SA BUCKLING UNDER SOE STRESSES
On the South African front, a relatively calm week was seen politically, with more focus being placed on foundational issues within the country such as government’s involvement in Eskom, SAA and Telkom. With Eskom finding itself on the wrong side of media headlines this year, this week it continued to underwhelm the market as questions over when or whether a new CEO will be appointed flooded headlines. Missing their promised deadline by the end of October, Eskom now sits halfway through November without a CEO as the political tussle for the position carries on in the undertow.
With approximately 3,000 employees and members of the African Cabin Crew Association (SACCA) and the National Union of Metalworkers of South Africa (NUMSA) looking to strike at SAA from Friday 15 November, the company finds itself in dire straits. With employees demanding an 8% salary increase amidst a company restructure that could see 944 jobs being lost, tensions were running on high on Thursday. SAA had initially offered to increase salaries by 5.9%, however the Union and employees weren’t amused. Thursday afternoon saw SAA announcing that they could look at offering another number at some point during the day.
When looking at South African data, retail sales came in extremely flat, both month-on-month and year-on-year while mining production numbers surprised to the upside in September, mainly on the back of and 8.2% expansion in iron ore production. The rand unfortunately gave way to the strengthening of the US dollar this week, losing around 1.7% between Monday and Thursday, slipping from R14.75/$ to R15.00. The rand did tend to scrape back some losses against the USD after the stronger-than-expected mining production numbers. The possibility of a new SAA offer to the unions may have added a further strengthening impetus to the rand.
Read the full article here
Our JSE All Share index daily performance calendar
Visit our JSE Calendar tracker page for a expanded version of the calendar below
The graphic below provides the daily returns of the JSE All Share Index (J203) on a calendar chart. Provides a great overview of the All share index over the course of the month. It will be updated daily with our daily investment update as received from PSG.
So the month of October 2019 saw the JSE All Share Index end in the green. And the first trading day of November 2019 saw the JSE edge up slightly last week Friday. Can the momentum continue and the "Christmas rally" carry the markets higher in the closing months of 2019? So the hard work of the first few trading days of November 2019 was basically wiped out by two negative days towards the end of last week. The JSE All Share Index is down -0.63% for the month of November 2019. And the trend over the last couple of trading days has been for the JSE All Share Index to close down slightly. Last week saw 4 negative trading days for the JSE All Share and only 1 mildly positive trading day.
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article