14/05/2020
Morning All
World Markets feel like reality has set in after Fed Chairman Jerome Powell said ‘’the path forward was highly uncertain and subject to many down side risks’’ and that more may need to be done to support the economy. It all feels a bit like late March.
NPN and PRX rise 3.89 and 6.92% respectively after Tencent report 1Q net income at 28.9 bln Yuan vs cons of 23.61 Bln. Tencent is 0.37% higher this morning in poor markets.
FTSE/JSE Africa All-Share Index down 0.3% to 50,152.05, Rand weakens 0.4% to 18.50/US$, Yield on 10 year govt rand bonds rose 10.8 bps to 9.446%.
South African President Cyril Ramaphosa announced plans to further ease a nationwide lockdown as the fallout from shuttering much of the economy threatens to outweigh the damage wrought by the coronavirus.
Consultations will begin in coming days about moving most of country from disease alert level four to level three by the end of the month, and allow a number of additional industries to resume operations.
• RMB Named as Financial Adviser for South Africa’s Land Bank.
• AfriSam Reduces Debt With Stake Sale to Four South African Banks.
• Hedge Fund That’s Never Lost Bets Big on South African Debt.
The Dow and S&P 500 fell 2.2% and 1.8%, respectively, while the Nasdaq Composite lost 1.6%. Those declines followed a stark warning from Federal Reserve Chairman Jerome Powell earlier in the day. Despite the sharp drop, the S&P 500 remains more than 28% above its March 23 low. The Dow has also rallied more than 27% since then as shares of major tech companies surged. On the technical side the S&P traded down to 2790 on the support and the bounced to close above 2800 at 2820.
Asian stocks retreated after Federal Reserve Chair Jerome Powell warned about economic risks and big-name investors fueled doubts about valuations, some saying they the most over- valued since 1999.
Shares slipped from Sydney to Hong Kong, though declines were shallower than seen on Wall Street. Futures on the S&P 500 fluctuated after the index briefly fell Wednesday below 2,800 -- a level that’s provided support in the past month. The Australian dollar fell after data showed a record plunge of over half a million jobs in April, the ASX 200 is 1.72% lower.
Precious Metals are little change with Gold at $ 1715, Plat, $767 and Palladium $ 1828. Oil remains steady as markets remain cautious on some economies re-opening, Brent $ 29.35 and WTI $ 25.47.
Source: Sinayo Securities
