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PSG daily investment update 27 May 2019
Date: 27 May 2019 Category: Stock Market |
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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 rant at the end.
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Short summary of PSG's market commentary for 27 May 2019
South Africa
The JSE pushed a little higher on Friday, lifted by improved sentiment on global markets, although overall it was a poor week for the local bourse. The All Share closed 0.28% higher.
United States
Wall Street rose on Friday, ahead of a long Memorial Day weekend, after US President Donald Trump predicted a swift end to the ongoing trade war with China. Shortly after the JSE closed, the Dow was up 0.12%.
Europe
European markets appeared unfazed on Friday by British Prime Minister Theresa May’s resignation as Conservative party leader after failing in a final attempt to win parliamentary support for her divorce deal with the European Union. The pan-European STOXX 600 ended up 0.56%.
Hong Kong
Hong Kong stocks ended higher on Friday, as sanctions against Huawei raised fears about Sino-US trade tensions morphing into a tech cold war. The Hang Seng index rose 0.34%.
Japan
The Nikkei dipped on Friday as escalating tensions between Washington and Beijing over trade and technology firms weighed on investor appetite. The Nikkei ended the day 0.16% lower.
Rand
The rand was slightly firmer on Friday afternoon, set to close higher after a volatile week, amid a host of global and local developments. At 20h30, a dollar traded for R14.41.
Precious metals
Gold eased on Friday as stock markets regained momentum, with renewed hopes of a rate cut by the US Federal Reserve keeping bullion on track. At 20h30, an ounce of spot gold traded at $1 284.28.
Oil
Oil rose towards $69 a barrel on Friday after two sessions of losses, but remained on track for its biggest weekly drop this year due to rising inventories and concerns of an economic slowdown.
The JSE pushed a little higher on Friday, lifted by improved sentiment on global markets, although overall it was a poor week for the local bourse. The All Share closed 0.28% higher.
United States
Wall Street rose on Friday, ahead of a long Memorial Day weekend, after US President Donald Trump predicted a swift end to the ongoing trade war with China. Shortly after the JSE closed, the Dow was up 0.12%.
Europe
European markets appeared unfazed on Friday by British Prime Minister Theresa May’s resignation as Conservative party leader after failing in a final attempt to win parliamentary support for her divorce deal with the European Union. The pan-European STOXX 600 ended up 0.56%.
Hong Kong
Hong Kong stocks ended higher on Friday, as sanctions against Huawei raised fears about Sino-US trade tensions morphing into a tech cold war. The Hang Seng index rose 0.34%.
Japan
The Nikkei dipped on Friday as escalating tensions between Washington and Beijing over trade and technology firms weighed on investor appetite. The Nikkei ended the day 0.16% lower.
Rand
The rand was slightly firmer on Friday afternoon, set to close higher after a volatile week, amid a host of global and local developments. At 20h30, a dollar traded for R14.41.
Precious metals
Gold eased on Friday as stock markets regained momentum, with renewed hopes of a rate cut by the US Federal Reserve keeping bullion on track. At 20h30, an ounce of spot gold traded at $1 284.28.
Oil
Oil rose towards $69 a barrel on Friday after two sessions of losses, but remained on track for its biggest weekly drop this year due to rising inventories and concerns of an economic slowdown.
Our daily update
As we do every week, we provide readers with Peregrine Treasury services weekly market wrap every Friday. Below part of the weekly wrap that pertains to South African equities.
SOUTH AFRICAN EQUITY
Is South Africa becoming an entirely uninviting investment destination?
South African equities have taken a massive blow this week, due to the tidal waves sent through emerging markets, following the US China scuffle. With SA’s political landscape still trying to find a way forward, the global slowdown and now the decay of emerging markets through the trade war, things aren’t looking too bright on SA shores when it comes to the equity market. And to top this all off, the almost clandestine behavior seen in a growing amount of South African listed entities has seen liquidity drying up on the Johannesburg Securities Exchange (JSE) in 2019.
This week saw Massmart, Brait and Sasol all experiencing devastating 10.00% down days – a trend that seems to be becoming a normal daily event on the JSE.
Here’s some of the bigger movers on the JSE for the 2019 year so far, as at Friday morning:
Read the full article here.
SOUTH AFRICAN EQUITY
Is South Africa becoming an entirely uninviting investment destination?
South African equities have taken a massive blow this week, due to the tidal waves sent through emerging markets, following the US China scuffle. With SA’s political landscape still trying to find a way forward, the global slowdown and now the decay of emerging markets through the trade war, things aren’t looking too bright on SA shores when it comes to the equity market. And to top this all off, the almost clandestine behavior seen in a growing amount of South African listed entities has seen liquidity drying up on the Johannesburg Securities Exchange (JSE) in 2019.
This week saw Massmart, Brait and Sasol all experiencing devastating 10.00% down days – a trend that seems to be becoming a normal daily event on the JSE.
- Massmart: headline earnings guidance said to almost halve for the six months to June 2019. New CEO also appointed, Mitchell Slape – from US’ Walmart.
- Sasol: Lake Charles project cost increases to around 50.00% more than initially planned. Total expected cost of the project to come in at around $12.75 billion – $1 billion more than expected three months ago.
- Brait: Net asset value of their business to fall between 23.4% and 27.00%. This sending the share price to seven-year-lows of around R20.45.
Here’s some of the bigger movers on the JSE for the 2019 year so far, as at Friday morning:
- Impala Platinum: up 47.38%
- Kumba Iron Ore: up 52.36%
- Lonmin: up 33.73%
- Tongaat Hulett: down 65.51%
- Rebosis Property Fund: down 66.91%
- Delta Property Fund: down 48.44%
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.
The month of May continues to be negative, and this after 4 months of positive returns for the JSE All Share Index. As can be seen from the Calendar chart above the number of red blocks far outnumber the number of green blocks. It has been a pretty miserable month so far on the JSE, and May has wiped out almost half of the returns the market made in the first 4 months of 2019. Seems like sell in May and stay away is holding true. Yesterday biggest negative days on the JSE so far this year.
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