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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 5 June 2019
South Africa
Weak GDP results shocked investors, but the JSE still closed up on Tuesday thanks to strong performances by miners and companies with large offshore earnings. At the closing bell, the All Share rose 0.38%.
United States
US shares started Tuesday in the green as investors were optimistic about possible interest rate cuts by the US Federal Reserve (Fed) later in the day. Shortly after the JSE closed, the Nasdaq was up 1.91%.
Europe
European markets enjoyed gains on Tuesday, boosted by auto-makers and auto suppliers that reached their highest point in over two months. The STOXX 600 closed 0.59% higher.
Hong Kong
On Tuesday, Asian markets recorded negative performances for yet another day due to the escalating tit-for-tat trade dispute between China and the US as well as the Chinese economy losing momentum. The Shanghai Composite Index ended the day 0.96% in the red.
Japan
Mixed trade due to SoftBank and trade tensions were offset by manufacturing gains which led to the Nikkei closing flat on Tuesday. At the end of trade, the Nikkei was 0.01% down.
Rand
The 3.20% contraction in GDP (its biggest drop since 2009’s financial crisis) hit the rand hard on Tuesday as it fell by 2.10% intraday. At 18h40, the rand traded at R14.76 against the dollar.
Precious metals
Speculations on Tuesday that the Feb might be forced to cut US interest rates to offset trade war strains pushed investors to search for safe investments, which led to gold prices reaching a near three-month high. At 18h40, an ounce of spot gold cost $1 323.86.
Oil
On Tuesday, oil slipped to its lowest point since January on the back of indications that a slower global economy is hurting demand and as Russia’s biggest oil producer opposed OPEC’s extended rate cuts. At 18h40, a barrel of Brent crude traded at $62.86.
Weak GDP results shocked investors, but the JSE still closed up on Tuesday thanks to strong performances by miners and companies with large offshore earnings. At the closing bell, the All Share rose 0.38%.
United States
US shares started Tuesday in the green as investors were optimistic about possible interest rate cuts by the US Federal Reserve (Fed) later in the day. Shortly after the JSE closed, the Nasdaq was up 1.91%.
Europe
European markets enjoyed gains on Tuesday, boosted by auto-makers and auto suppliers that reached their highest point in over two months. The STOXX 600 closed 0.59% higher.
Hong Kong
On Tuesday, Asian markets recorded negative performances for yet another day due to the escalating tit-for-tat trade dispute between China and the US as well as the Chinese economy losing momentum. The Shanghai Composite Index ended the day 0.96% in the red.
Japan
Mixed trade due to SoftBank and trade tensions were offset by manufacturing gains which led to the Nikkei closing flat on Tuesday. At the end of trade, the Nikkei was 0.01% down.
Rand
The 3.20% contraction in GDP (its biggest drop since 2009’s financial crisis) hit the rand hard on Tuesday as it fell by 2.10% intraday. At 18h40, the rand traded at R14.76 against the dollar.
Precious metals
Speculations on Tuesday that the Feb might be forced to cut US interest rates to offset trade war strains pushed investors to search for safe investments, which led to gold prices reaching a near three-month high. At 18h40, an ounce of spot gold cost $1 323.86.
Oil
On Tuesday, oil slipped to its lowest point since January on the back of indications that a slower global economy is hurting demand and as Russia’s biggest oil producer opposed OPEC’s extended rate cuts. At 18h40, a barrel of Brent crude traded at $62.86.
Our daily update
The quarter on quarter annualised growth rates (fancy speak for assuming growth in the industry from Q1:2019 over Q4:2018 continued for a full year) for the various sectors of South Africa is summarised below:
South African economists got this horribly wrong as they expected a contraction of around -1.6%, in the end the contraction ended up being twice that size. The numbers above shows that hardly any sector in the economy was spared during the first quarter of 2019. A horrible number for the South African economy and the millions of people in South Africa looking for jobs and hoping the economy starts growing so that they can find employment. The only lights in this dark economic tunnel of South Africa were the Finance, Real Estate and Business Services sector, Personal services and government grew a small amount The rest of the sectors suffered.
For more one SA's GDP click here
- Agriculture/forestry and fishing: -13.2 %
- Mining: -10.8%
- Manufacturing: -8.8%
- Electricity/water and gas supply: -6.9%
- Construction: -2.2%
- Trade (wholesale, retail and motor trade): -3.6%
- Transport: -4.4%
- Finance, Real Estate and business services: 1.1%
- Government: 1.2%
- Personal services: 1.1%
- Actual GDP for Q1:2012: -3.2%
South African economists got this horribly wrong as they expected a contraction of around -1.6%, in the end the contraction ended up being twice that size. The numbers above shows that hardly any sector in the economy was spared during the first quarter of 2019. A horrible number for the South African economy and the millions of people in South Africa looking for jobs and hoping the economy starts growing so that they can find employment. The only lights in this dark economic tunnel of South Africa were the Finance, Real Estate and Business Services sector, Personal services and government grew a small amount The rest of the sectors suffered.
For more one SA's GDP click 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 after four very positive months on the markets the month of May bucked the trend and saw half the gains made during the first four months of the year on the JSE wiped out in one month. So what will the month of June 2019 hold for the markets? With trade war in full swing, Chinese manufacturing declining, Brexit worries continuing all we know is it is going to be a bumpy ride.
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