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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 October 2019
South Africa
The JSE made loses on Thursday as load-shedding continued to haunt the local bourse after Moody’s issued a warning that Eskom woes would eventually result in a credit rating downgrade. At the closing bell, the JSE All Share lost 0.17%.
United States
US stocks surged on Thursday as investors cheered Britain’s newly drafted deal with the European Union, while strong performances by Morgan Stanley and Netflix further boosted the markets. Just after the JSE closed, the S&P 500 and the Nasdaq gained 0.24% and 0.29% respectively.
Europe
A new Brexit deal boosted European markets to a year-and-a-half peak and forced safe-haven assets into a downward spiral. Details of the deal are still sketchy however, it is now up to the lawmakers in parliament to weigh the conditions and plausibility of the deal. Shortly after the JSE closed, the FTSE 100 Index gained 0.20%.
Hong Kong
Although investors grew weary of the prolonged protests in the region, optimism over the prospect of more stimulus measures to bolster growth lifted shares in Hong Kong on Thursday. The Hang Seng closed 0.69% in the green.
Japan
Chinese shares ended flat on Thursday as investors waited to get more clarity on a trade deal struck by Washington and Beijing. At 18h45, the Nikkei recorded a 0.02%loss.
Rand
The rand strengthened against major global currencies on Thursday following the announcement of a Brexit deal, while investors sought new catalysts from the government’s plan to rescue Eskom. At 18h50, a dollar traded at R14.81.
Precious metals
Gold prices were mixed on Thursday as investors sought new catalysts from both the Brexit and US-China trade deals. An ounce of spot gold traded at $1 495.00 at 19h00.
Oil
Oil prices fell on Thursday following the release of data which pointed to the biggest increase in US crude inventories since February 2017 in the previous week. At 19h15, a barrel of Brent crude traded at $59.31
The JSE made loses on Thursday as load-shedding continued to haunt the local bourse after Moody’s issued a warning that Eskom woes would eventually result in a credit rating downgrade. At the closing bell, the JSE All Share lost 0.17%.
United States
US stocks surged on Thursday as investors cheered Britain’s newly drafted deal with the European Union, while strong performances by Morgan Stanley and Netflix further boosted the markets. Just after the JSE closed, the S&P 500 and the Nasdaq gained 0.24% and 0.29% respectively.
Europe
A new Brexit deal boosted European markets to a year-and-a-half peak and forced safe-haven assets into a downward spiral. Details of the deal are still sketchy however, it is now up to the lawmakers in parliament to weigh the conditions and plausibility of the deal. Shortly after the JSE closed, the FTSE 100 Index gained 0.20%.
Hong Kong
Although investors grew weary of the prolonged protests in the region, optimism over the prospect of more stimulus measures to bolster growth lifted shares in Hong Kong on Thursday. The Hang Seng closed 0.69% in the green.
Japan
Chinese shares ended flat on Thursday as investors waited to get more clarity on a trade deal struck by Washington and Beijing. At 18h45, the Nikkei recorded a 0.02%loss.
Rand
The rand strengthened against major global currencies on Thursday following the announcement of a Brexit deal, while investors sought new catalysts from the government’s plan to rescue Eskom. At 18h50, a dollar traded at R14.81.
Precious metals
Gold prices were mixed on Thursday as investors sought new catalysts from both the Brexit and US-China trade deals. An ounce of spot gold traded at $1 495.00 at 19h00.
Oil
Oil prices fell on Thursday following the release of data which pointed to the biggest increase in US crude inventories since February 2017 in the previous week. At 19h15, a barrel of Brent crude traded at $59.31
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Our daily update
The extract below highlights South Africa's continued load -shedding woes as published in Peregrine Treasury Services latest market wrap
Load-shedding hogs SA news, and it’s also not over
Unexpected load-shedding has again left the country intermittently in the dark since mid-week, as embattled power utility Eskom fights to avoid a total collapse of the local power system. This latest round of load-shedding comes shortly after NERSA declined Eskom’s application for yet another tariff hike. With the timing being rather suspicious, Eskom has blamed the load-shedding on five power-generating units falling out of use due to boiler tube leaks.
Load-shedding is estimated to be costing the economy in the region of R2bn a day and poses a significant threat to the local GDP. A downward adjustment in the GDP forecast to 0.8% could now be an overestimation, depending on the duration and intensity of rolling blackouts throughout the country.
In these “dark times”, there is at least a glimmer of hope: Cabinet promulgated the Independent Resource Plan (IRP) that addresses electricity supply for the next 10 years. The IRP incorporates aspects such as the deployment of alternative energy sources, the decommissioning of coal power stations, while proposing nine interventions to respond to energy demand. Local retail sales released this week undershot expectations, rising by 1.1% year-on-year during August, down from the previous 2%. While the rand momentarily pushed above R15.00/$ following the reintroduction of load-shedding, poor economic data from the US, coupled with the approval of the IRP, saw the rand gain substantial ground against major currencies again on Thursday. After starting the day at R14.92/$, the rand managed to rally to an intraday high of R14.79/$.
Read the full article here
Load-shedding hogs SA news, and it’s also not over
Unexpected load-shedding has again left the country intermittently in the dark since mid-week, as embattled power utility Eskom fights to avoid a total collapse of the local power system. This latest round of load-shedding comes shortly after NERSA declined Eskom’s application for yet another tariff hike. With the timing being rather suspicious, Eskom has blamed the load-shedding on five power-generating units falling out of use due to boiler tube leaks.
Load-shedding is estimated to be costing the economy in the region of R2bn a day and poses a significant threat to the local GDP. A downward adjustment in the GDP forecast to 0.8% could now be an overestimation, depending on the duration and intensity of rolling blackouts throughout the country.
In these “dark times”, there is at least a glimmer of hope: Cabinet promulgated the Independent Resource Plan (IRP) that addresses electricity supply for the next 10 years. The IRP incorporates aspects such as the deployment of alternative energy sources, the decommissioning of coal power stations, while proposing nine interventions to respond to energy demand. Local retail sales released this week undershot expectations, rising by 1.1% year-on-year during August, down from the previous 2%. While the rand momentarily pushed above R15.00/$ following the reintroduction of load-shedding, poor economic data from the US, coupled with the approval of the IRP, saw the rand gain substantial ground against major currencies again on Thursday. After starting the day at R14.92/$, the rand managed to rally to an intraday high of R14.79/$.
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.
While the month of August was negative by -1.73% lets see what the month of September holds for the South African stock market.
So for the month September 2019 the JSE All Share Index ended the month down -2.01%. Midway through the trading month of October 2019 and the JSE All Share Index is up by 2.19%. Question is whether it can hold on to the gains made for the rest of the month. There seems to be a softening of the trade wars rhetoric as both the USA and China looks to avoid further damage being caused to their economies and it looks like the UK might be striking a deal with the EU to leave the EU. Seems Brexit might finally be happening
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
So for the month September 2019 the JSE All Share Index ended the month down -2.01%. Midway through the trading month of October 2019 and the JSE All Share Index is up by 2.19%. Question is whether it can hold on to the gains made for the rest of the month. There seems to be a softening of the trade wars rhetoric as both the USA and China looks to avoid further damage being caused to their economies and it looks like the UK might be striking a deal with the EU to leave the EU. Seems Brexit might finally be happening
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