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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 19 August 2019
South Africa
The JSE closed flat on Friday as global-growth concerns pushed investors to perceived safe havens such as gold and the dollar.
United States
Wall Street’s three main indexes rose more than 1% on Friday, on hopes of more stimulus from central banks to perk up slowing growth. Soon after the JSE closed, the Dow was 1.08% higher.
Europe
European shares rebounded on Friday, as hopes of fiscal stimulus from Germany lifted sentiment and sparked a rally in the battered banks sector. Soon after the JSE closed, the FTSE 100 had gained 0.72%, France’s CAC 40 1.22%, and Germany’s DAX 30 1.37%.
Hong Kong
Hong Kong stocks ended firmer on Friday, as sentiment wilted amid worries over global economic slowdown, the Sino-US bruising tariff war and violent protests that threatened the island city’s economy. The Hang Seng Index ended up 0.90%.
Japan
Japanese shares edged up Friday after markets in China and Hong Kong found some stability amid ongoing unrest in Hong Kong, but the gains were limited by nagging fears of a global economic slowdown. The Nikkei Index gained 0.06%.
Rand
The rand was firmer on Friday, rebounding after a heavy global sell-off week prompted by fears of a global recession and the concerns about the US-China trade war. At 20h30, the rand traded at $15.28 to the US dollar.
Precious metals
Gold fell on Friday, weighed down by gains in the equity markets and the dollar, but fears of a global recession and lack of clarity on the US-China trade war kept bullion on track for a third straight weekly gain. At 20h30 an ounce of gold traded at $1 514.03.
Oil
Crude oil prices rose on Friday, recovering from two days of declines after data showing a rise in US retail sales helped to ease concerns about a recession in the world's biggest economy. A barrel of Brent crude traded at $58.79 at 20h30.
The JSE closed flat on Friday as global-growth concerns pushed investors to perceived safe havens such as gold and the dollar.
United States
Wall Street’s three main indexes rose more than 1% on Friday, on hopes of more stimulus from central banks to perk up slowing growth. Soon after the JSE closed, the Dow was 1.08% higher.
Europe
European shares rebounded on Friday, as hopes of fiscal stimulus from Germany lifted sentiment and sparked a rally in the battered banks sector. Soon after the JSE closed, the FTSE 100 had gained 0.72%, France’s CAC 40 1.22%, and Germany’s DAX 30 1.37%.
Hong Kong
Hong Kong stocks ended firmer on Friday, as sentiment wilted amid worries over global economic slowdown, the Sino-US bruising tariff war and violent protests that threatened the island city’s economy. The Hang Seng Index ended up 0.90%.
Japan
Japanese shares edged up Friday after markets in China and Hong Kong found some stability amid ongoing unrest in Hong Kong, but the gains were limited by nagging fears of a global economic slowdown. The Nikkei Index gained 0.06%.
Rand
The rand was firmer on Friday, rebounding after a heavy global sell-off week prompted by fears of a global recession and the concerns about the US-China trade war. At 20h30, the rand traded at $15.28 to the US dollar.
Precious metals
Gold fell on Friday, weighed down by gains in the equity markets and the dollar, but fears of a global recession and lack of clarity on the US-China trade war kept bullion on track for a third straight weekly gain. At 20h30 an ounce of gold traded at $1 514.03.
Oil
Crude oil prices rose on Friday, recovering from two days of declines after data showing a rise in US retail sales helped to ease concerns about a recession in the world's biggest economy. A barrel of Brent crude traded at $58.79 at 20h30.
Our daily update
On Friday we covered the latest weekly world markets wrap from Peregrine Treasury Services. Below an extract that pertains to South Africa's equity markets.
SOUTH AFRICAN EQUITY
SA equities haven’t enjoyed the best of months so far, within the turmoil of the global political chess game being played. With the risk-off environment being witnessed, it’s been tough to find any one company that’s been able to hold themselves together, especially where business operations utilize rands. For the month of August, let’s have a look at some of the carnage that’s been happening:
ABSA bank reported a three percent increase in headline earnings to R8.3 billion for the six months to end June. These are promising and positive results for the bank, especially considering the current pressured economic climate, and the rollout of the companywide reorganization strategy seems to have been successfully managed so far. Although ABSA still has a way to go before achieving its long-term growth strategies, it appears to be heading in the right direction. ABSA opened Friday’s trading day at R152.10 per share
Gaining support, through a handful of financing arrangements, Steinhoff have managed to keep their heartbeat going until at least 2021. The heavily debt-laden company, due to one of the biggest South African corporate scandals ever, will now focus wholly on becoming a holding company focusing on retail businesses vs an actual operating retail business. For the foreseeable future, Steinhoff will continue selling off assets in order to claw its way out of its hairy debt situation, as underlying revenues from their current business operations aren’t enough to make a dent. Steinhoff opened Friday’s Trading day at R1.18 per share.
Year-to-date, the JSE All Share index is up 2.09% and the Top 40 up 2.98%. Sector-wise, industrials have now returned 9.06%, resources 3.56% and financials -9.92% for the 2019 year so far.
Read full article here
SOUTH AFRICAN EQUITY
SA equities haven’t enjoyed the best of months so far, within the turmoil of the global political chess game being played. With the risk-off environment being witnessed, it’s been tough to find any one company that’s been able to hold themselves together, especially where business operations utilize rands. For the month of August, let’s have a look at some of the carnage that’s been happening:
- All Share and Top 40 indices: down around 5.47%
- Resources: down 5.86%
- Industrials: down 4.17% (Naspers: down 4.42%)
- Financials: down 6.64%
ABSA bank reported a three percent increase in headline earnings to R8.3 billion for the six months to end June. These are promising and positive results for the bank, especially considering the current pressured economic climate, and the rollout of the companywide reorganization strategy seems to have been successfully managed so far. Although ABSA still has a way to go before achieving its long-term growth strategies, it appears to be heading in the right direction. ABSA opened Friday’s trading day at R152.10 per share
Gaining support, through a handful of financing arrangements, Steinhoff have managed to keep their heartbeat going until at least 2021. The heavily debt-laden company, due to one of the biggest South African corporate scandals ever, will now focus wholly on becoming a holding company focusing on retail businesses vs an actual operating retail business. For the foreseeable future, Steinhoff will continue selling off assets in order to claw its way out of its hairy debt situation, as underlying revenues from their current business operations aren’t enough to make a dent. Steinhoff opened Friday’s Trading day at R1.18 per share.
Year-to-date, the JSE All Share index is up 2.09% and the Top 40 up 2.98%. Sector-wise, industrials have now returned 9.06%, resources 3.56% and financials -9.92% for the 2019 year so far.
Read 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 South African stock market is still up substantially for the year, with the only negative months so far being the month of May in which markets pulled back pretty sharply. But the markets rebounded in June with it ending up close to 5% for the month.
The JSE All Share Index ended the month of July down by -2.6%. Only the second negative month for the JSE in 2019. So far August has gotten off to a horrible start, with the JSE All Share index losing -4.83% so far in August 2019. The strong decline for August 2019 is largely driven by the trade and currency war going on between the United States and China and bond yield inversion which is leading markets to believe that a recession in the USA is on its way
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
The JSE All Share Index ended the month of July down by -2.6%. Only the second negative month for the JSE in 2019. So far August has gotten off to a horrible start, with the JSE All Share index losing -4.83% so far in August 2019. The strong decline for August 2019 is largely driven by the trade and currency war going on between the United States and China and bond yield inversion which is leading markets to believe that a recession in the USA is on its way
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