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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 24 October 2019
South Africa
The JSE closed lower on Wednesday, while global markets were mixed as investors waited for the EU’s verdict on the Brexit extension. The All Share fell 0.65%.
United States
Wall Street was supported by gains in Apple and Boeing shares on Wednesday, though weak earnings from Caterpillar and Texas Instruments raised concerns of an impact from the US-China trade war on global growth. The Dow was up 0.26% just after the JSE closed.
Europe
European shares struggled to make headway on Wednesday as investor concerns about a further delay to Britain’s departure from the EU offset gains for London’s exporter-heavy FTSE 100 from a weaker pound and some decent corporate earnings. The pan-European STOXX 600 index closed just 0.10% higher.
Hong Kong
Hong Kong stocks closed lower on Wednesday as economic headwinds and political unrest in the Asian financial centre weighed on sentiment. The Hang Seng index was down 0.82%.
Japan
Japanese shares closed higher yesterday supported by gains for the phrama-sector thanks to drug maker, Eisai rallying hard, though weak chip-related stocks capped the gains after disappointing results from Texas Instruments. The benchmark Nikkei average added 0.34%.
Rand
The rand strengthened on Wednesday after consumer inflation moderated more than analysts’ expectations in September. At 20h15, a dollar traded at $14.62.
Precious metals
Gold prices were steady on Wednesday, as investors awaited more clarity on the Brexit and the US-China trade war, but a rally in the bond markets provided modest support to the bullion. At 20h15, an ounce of spot gold traded at $1 493.09.
Oil
Oil prices rose on Wednesday, after prospects of deeper output cuts by Opec and its allies offered support. At close of trade, a barrel of Brent crude traded at $61.31
The JSE closed lower on Wednesday, while global markets were mixed as investors waited for the EU’s verdict on the Brexit extension. The All Share fell 0.65%.
United States
Wall Street was supported by gains in Apple and Boeing shares on Wednesday, though weak earnings from Caterpillar and Texas Instruments raised concerns of an impact from the US-China trade war on global growth. The Dow was up 0.26% just after the JSE closed.
Europe
European shares struggled to make headway on Wednesday as investor concerns about a further delay to Britain’s departure from the EU offset gains for London’s exporter-heavy FTSE 100 from a weaker pound and some decent corporate earnings. The pan-European STOXX 600 index closed just 0.10% higher.
Hong Kong
Hong Kong stocks closed lower on Wednesday as economic headwinds and political unrest in the Asian financial centre weighed on sentiment. The Hang Seng index was down 0.82%.
Japan
Japanese shares closed higher yesterday supported by gains for the phrama-sector thanks to drug maker, Eisai rallying hard, though weak chip-related stocks capped the gains after disappointing results from Texas Instruments. The benchmark Nikkei average added 0.34%.
Rand
The rand strengthened on Wednesday after consumer inflation moderated more than analysts’ expectations in September. At 20h15, a dollar traded at $14.62.
Precious metals
Gold prices were steady on Wednesday, as investors awaited more clarity on the Brexit and the US-China trade war, but a rally in the bond markets provided modest support to the bullion. At 20h15, an ounce of spot gold traded at $1 493.09.
Oil
Oil prices rose on Wednesday, after prospects of deeper output cuts by Opec and its allies offered support. At close of trade, a barrel of Brent crude traded at $61.31
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Our daily update
Yesterday we covered the latest inflation rate of South Africa for September 2019. The summary below shows South Africa's inflation rate per province and nationally.
The summary below shows the inflation rates per province in South Africa for September 2019. And surprise surprise the inflation rate of Limpopo is the highest of any province. The first time in 30 months its not been the Western Cape
So for the last 30 months, the Western Cape has had the highest inflation rate of any of South Africa's provinces, and this month its the first time in 31 months that another province recorded an inflation rate higher than that of the Western Cape. Western Cape's persistently higher inflation rate has been attributed to the growth rate in their property rent. See more regarding this in our Cape Town Property Bubble article.
Other noteworthy inflation numbers for South Africa in September 2019
The extremely low rates of inflation for durable and semi-durable goods (all goods expected to last between a year and 5 years such as appliances, and clothing and footwear etc) shows that retailers are struggling to sell these type of goods thus very little price increases are levied on such goods else retailers wont be able to move the stock as consumers wont buy it. It is a manifestation of the weak economic conditions and struggling consumer demand in South Africa. So the question is what excuse will the South African Reserve Bank (SARB) monetary policy committee (MPC) come up with now not to cut interest rates at their next MPC meeting?
Read more about South Africa's inflation rate here
The summary below shows the inflation rates per province in South Africa for September 2019. And surprise surprise the inflation rate of Limpopo is the highest of any province. The first time in 30 months its not been the Western Cape
- Limpopo: 4.8%
- Western Cape: 4.6%
- Northern Cape: 4.1%
- South Africa: 4.1%
- Free State: 4.0%
- Gauteng: 4.0%
- KwaZulu-Natal: 4.0%
- Mpumalanga: 3.7%
- Eastern Cape: 3.7%
- North West: 3.6%
So for the last 30 months, the Western Cape has had the highest inflation rate of any of South Africa's provinces, and this month its the first time in 31 months that another province recorded an inflation rate higher than that of the Western Cape. Western Cape's persistently higher inflation rate has been attributed to the growth rate in their property rent. See more regarding this in our Cape Town Property Bubble article.
Other noteworthy inflation numbers for South Africa in September 2019
- Pensioners inflation: 4.2%
- Inflation for services: 4.2%
- Inflation for all goods: 4.0%
- Inflation for durable goods: 2.4%
- Inflation for semi-durable goods: 2.1%
- Inflation for non durable goods: 4.5%
The extremely low rates of inflation for durable and semi-durable goods (all goods expected to last between a year and 5 years such as appliances, and clothing and footwear etc) shows that retailers are struggling to sell these type of goods thus very little price increases are levied on such goods else retailers wont be able to move the stock as consumers wont buy it. It is a manifestation of the weak economic conditions and struggling consumer demand in South Africa. So the question is what excuse will the South African Reserve Bank (SARB) monetary policy committee (MPC) come up with now not to cut interest rates at their next MPC meeting?
Read more about South Africa's inflation rate 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 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 2.1%. 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
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