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31/10/2024

STANLIB - MARKET COMMENTARY - 31 OCTOBER 2024

South African Markets
The Top-40 Index Falls Amid Budget Deficit Warnings

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86759.04 -0.62 12.83
Financial 15 20995.09 0.77 17.47
Industrial 25 117727 -0.92 13.51
Resource 10 61537.94 -1.83 6.96
Property - Total Return 2384.189 -0.63 27.93

The Top-40 index in South Africa closed lower on Wednesday as the government projected wider budget deficits and rising debt over the next three years, despite improving growth prospects due to better electricity supply. This mid-term budget, presented under the first coalition government following the African National Congress’s loss of majority, highlighted commitments to drive economic growth and advance reforms, boosting investor confidence and supporting a rally in the rand and local currency debt.
Global Markets
Global Markets Decline as Investors React to Earnings

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42141.54 -0.22 11.81
S&P 500 US 5813.67 -0.33 21.88
CAC 40 FRA 7428.36 -1.10 -1.52
DAX 30 GER 19257.34 -1.13 14.96
FTSE UK 8159.63 -0.73 5.51
Hang Seng HK 20380.64 -1.55 19.55
Nikkei 225 JPN 39277.39 0.96 17.37

European Market Summary
European markets closed lower on Wednesday as investors reviewed new corporate earnings, regional growth data, and the U.K. budget announcement. Preliminary data showed the euro zone economy grew by 0.4% in the third quarter of 2024, surpassing economists’ 0.2% forecast. In the U.K., Finance Minister Rachel Reeves outlined a budget that would increase taxes by £40 billion ($51.86 billion) to address what the Labour government has termed a “black hole” in public finances.

American Market Summary
U.S. stock indices closed lower on Wednesday as chip stocks fell and investors awaited upcoming corporate earnings. The Commerce Department reported that U.S. GDP grew at an annualized rate of 2.8% in the third quarter, just shy of the 3.0% forecast. Additionally, private payrolls growth exceeded expectations with a gain of 233,000 jobs in October. Meanwhile, investors kept a close watch on the tight presidential race between Kamala Harris and Donald Trump as the November 5 election approaches.

Asian Market Summary
Asia-Pacific markets declined this morning as investors focused on the Bank of Japan’s (BOJ) rate decision and key economic data from China. The BOJ maintained its benchmark policy rate at 0.25%, issuing a brief statement without indicating when the next rate hike might occur. In China, manufacturing activity showed improvement, with the purchasing managers index (PMI) rising to 50.1 in October - its first return to expansion since April - beating economists' forecast of 49.9 and marking an improvement over September’s 49.8.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.28 3 ----
Germany 2.39 5 -43
South Africa (10-year) 9.29 2 -139

FROM THE OFFICES OF STANLIB

25/10/2024

STANLIB - MARKET COMMENTARY - 25 OCTOBER 2024

South African Markets
SA Top-40 Up 0.45% as Platinum Miners Surge

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86937.24 0.55 13.06
Financial 15 21275.38 1.09 19.04
Industrial 25 116225.8 -0.47 12.06
Resource 10 62324.62 0.84 8.33
Property - Total Return 2423.091 1.14 30.01

On Thursday, South Africa's blue-chip Top-40 index rose by about 0.45%, driven by a surge in platinum group metals (PGMs) miners, as global palladium prices increased due to potential U.S. sanctions on Russia. Shares of Anglo American Platinum and Northam Platinum jumped by more than 13%. Anglo American PLC also reported progress in simplifying its portfolio, describing its production performance as "stable" for the first nine months of 2024. Meanwhile, retailer Clicks posted a 14.3% increase in headline earnings per share for the year ending 31 August 2024.
Global Markets
Asia-Pacific Markets Decline as Tokyo Inflation Slows

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42374.36 -0.33 12.43
S&P 500 US 5809.86 0.21 21.80
CAC 40 FRA 7503.28 0.08 -0.53
DAX 30 GER 19443 0.34 16.07
FTSE UK 8269.38 0.13 6.93
Hang Seng HK 20489.62 -1.30 20.19
Nikkei 225 JPN 38143.29 0.10 13.98

European Market Summary
European shares ended flat on Thursday as early gains faded due to concerns over slowing business activity and mixed earnings from companies like Evolution, Renault, and Unilever. A survey showed euro zone business activity remains in contraction, weighing on market sentiment. Despite a strong start to the year, the STOXX index has stagnated amid growing economic worries.

American Market Summary
The Nasdaq and S&P 500 rose on Thursday, lifted by Tesla's positive earnings outlook and falling Treasury yields, despite mixed corporate earnings. Recent stock pullbacks were driven by concerns over the Fed’s interest rate policies, rising yields, and uncertainty around the U.S. election. Meanwhile, U.S. business activity grew in October, and jobless claims unexpectedly fell.

Asian Market Summary
Asia-Pacific markets mostly declined as Tokyo’s core inflation dropped below the Bank of Japan’s 2% target for the first time in five months, complicating potential interest rate hikes. The core CPI rose 1.8% year-on-year, slightly above expectations, while services inflation slowed. China’s central bank kept interest rates steady in a 700 billion yuan loan operation at 2.00%.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.19 -6 ----
Germany 2.26 -4 -56
South Africa (10-year) 9.37 -14 -127

FROM THE OFFICES OF STANLIB

23/10/2024

STANLIB - MARKET COMMENTARY - 23 OCTOBER 2024

South African Markets
SA Top-40 Falls as Business Cycle Slips

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86752.88 -0.37 12.82
Financial 15 21066.68 -0.92 17.87
Industrial 25 116572 -0.30 12.39
Resource 10 62788.7 0.26 9.14
Property - Total Return 2378.541 -0.27 27.62

On Tuesday, South Africa's Top-40 index closed lower, as central bank data revealed a 0.7% drop in the leading business cycle indicator for August, wiping out the previous month's gains. Despite increased business confidence since the coalition government formed in June and stronger retail sales, sectors like mining remain in decline. Attention now shifts to today's September inflation data, with economists expecting a 3.9% year-on-year rate.
Global Markets
Markets Face Geopolitical and Economic Uncertainty

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42924.89 -0.02 13.89
S&P 500 US 5851.2 -0.05 22.67
CAC 40 FRA 7535.1 -0.01 -0.11
DAX 30 GER 19421.91 -0.15 15.94
FTSE UK 8306.54 -0.14 7.41
Hang Seng HK 20498.95 0.10 20.25
Nikkei 225 JPN 38411.96 -1.39 14.79

European Market Summary
European stocks declined on Tuesday, with investors grappling with uncertainty around geopolitics and potential global interest rate cuts. However, strong guidance from German tech giant SAP helped limit some losses in the tech sector. The IMF projected that Germany, a manufacturing leader, will see zero growth in 2024, which could drag down overall euro zone performance. Traders now expect the European Central Bank to reduce interest rates by around 130 basis points by the end of 2025, following ECB President Christine Lagarde’s comments that inflation may return to 2% faster than anticipated.

American Market Summary
U.S. stocks ended mostly flat on Tuesday, with the Nasdaq making a small gain as investors closely monitored Treasury yields and awaited further earnings reports to gauge the strength of U.S. companies. Equity markets are expected to remain volatile in the coming weeks as investors focus on company earnings, new economic data, the results of the U.S. election, and an upcoming Federal Reserve meeting. Traders are currently anticipating an 89.6% chance of a 25-basis-point interest rate cut in November, according to CME's FedWatch tool.

Asian Market Summary
Asia-Pacific markets mostly rose on Tuesday, diverging from Wall Street trends, as Tokyo Metro’s successful market debut fuelled investor optimism. Shares of the Japanese subway operator surged 45% in early trading following its IPO, which raised 348.6 billion yen, the largest in Japan since 2018. The IPO was 15 times oversubscribed, with shares priced at 1,200 yen each.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.23 3 ----
Germany 2.32 4 -57
South Africa (10-year) 9.33 -2 -150

FROM THE OFFICES OF STANLIB

21/10/2024

STANLIB - MARKET COMMENTARY - 21 OCTOBER 2024

South African Markets
Investors await September data

South African Market Indicators
Indicators Close 1D% YTD%
All Share 87201.49 0.72 13.41
Financial 15 21408.81 0.35 19.78
Industrial 25 117556.1 0.61 13.34
Resource 10 61535.8 1.29 6.96
Property - Total Return 2395.501 -0.41 28.53

On the Johannesburg Stock Exchange, the Top-40 index closed higher on Friday. Investors are now focusing on September's consumer inflation data, which may provide insight into the South African Reserve Bank's future interest rate decisions. In September, the central bank cut its lending rate for the first time in over four years after inflation dipped below 4.5%, the midpoint of its target range. Governor Lesetja Kganyago mentioned that lowering the inflation target could be achieved at minimal cost.
Global Markets
Earnings lift US markets

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 43275.91 0.09 14.82
S&P 500 US 5864.67 0.40 22.95
CAC 40 FRA 7613.05 0.39 0.93
DAX 30 GER 19657.37 0.38 17.35
FTSE UK 8358.25 -0.32 8.08
Hang Seng HK 20804.11 3.61 22.04
Nikkei 225 JPN 38981.75 0.18 16.49

European Market Summary
Europe's STOXX 600 closed higher on Friday, led by a strong rebound in tech stocks at the end of a volatile week. The European Central Bank's third interest rate cut of the year, along with positive corporate earnings, helped the index post gains for the second consecutive week. On Thursday, the ECB cut the deposit rate by 25 basis points as inflation risks in the European Union eased faster than expected, boosting market sentiment.

American Market Summary
The Dow Jones, S&P 500, and Nasdaq all ended higher on Friday, with the Dow and S&P 500 hitting record highs. The gains were driven by strong earnings from Netflix and other tech stocks. This marks the sixth straight week of growth for the major indexes, the longest winning streak since late 2023, supported by strong financial company earnings and positive economic data.

Asian Market Summary
Asia-Pacific markets showed mixed results this morning as traders reacted to China's announcement of cutting its one- and five-year loan prime rates by 25 basis points to 3.1% and 3.6%. This followed hints from China's central bank governor last week. Meanwhile, Japan's upcoming general election and key economic data, including Tokyo's October inflation and South Korea's third-quarter GDP figures, are also in focus.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.08 -1 ----
Germany 2.18 -3 -71
South Africa (10-year) 9.28 -3 -161

FROM THE OFFICES OF STANLIB

18/10/2024

STANLIB - MARKET COMMENTARY - 18 OCTOBER 2024

South African Markets
Local stocks tick higher

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86582.35 0.22 12.60
Financial 15 21334.08 -0.39 19.36
Industrial 25 116842.5 -0.60 12.66
Resource 10 60750.86 3.50 5.59
Property - Total Return 2405.313 -1.91 29.06

The Top-40 index on the stock market rose by 0.34% on Thursday as South Africa’s central bank governor, Lesetja Kganyago, suggested that moving to a lower inflation target might have minimal impact. The country’s September inflation figures, due next week, are expected to shed more light on inflation trends. PSG Financial Services, listed on the JSE, reported a 28% increase in headline earnings per share (HEPS) for the six months ending August 31, 2024. Meanwhile, Pick n Pay projected a larger headline loss for the half-year but indicated that its full-year profit before tax and capital items should improve significantly from the previous year.
Global Markets
US markets continue their momentum

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 43239.05 0.37 14.72
S&P 500 US 5841.47 -0.02 22.47
CAC 40 FRA 7583.73 1.22 0.54
DAX 30 GER 19583.39 0.77 16.90
FTSE UK 8385.13 0.67 8.43
Hang Seng HK 20079.1 -1.02 17.78
Nikkei 225 JPN 38911.19 -0.69 16.28

European Market Summary
European markets closed higher on Thursday as investors evaluated a series of corporate earnings and the European Central Bank’s (ECB) third interest rate cut of the year. The ECB reduced the deposit rate by 25 basis points during its October meeting, responding to easing inflation risks as price growth in the eurozone fell to 1.8% in September, below the bank’s 2% target.

American Market Summary
The Dow Jones Industrial Average hit its fourth record high in five days, driven by stronger-than-expected retail sales and a positive outlook from chipmaker TSMC. While the S&P 500 saw a slight drop and the Nasdaq barely gained, strong U.S. economic data, including a 0.4% rise in September retail sales and a drop in jobless claims, showed healthy growth. With this momentum and positive third-quarter earnings reports, markets are expecting the Federal Reserve to cut interest rates by 25 basis points at their next meeting.

Asian Market Summary
Asia-Pacific markets opened with mixed results this morning as investors reacted to key economic data from China and Japan. China's GDP growth for the third quarter was 4.6%, slightly above expectations but lower than the previous quarter, and house prices dropped 5.8% year-over-year in September. Despite this, China's CSI 300 rose 0.7% and Hong Kong's Hang Seng gained 1.3%. In Japan, inflation for September stood at 2.5%, with core CPI (excluding fresh food) rising 2.4%, slightly above forecasts.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.09 8 ----
Germany 2.21 2 -67
South Africa (10-year) 9.31 8 -152

FROM THE OFFICES OF STANLIB

16/10/2024

STANLIB - MARKET COMMENTARY - 16 OCTOBER 2024

South African Markets
Business confidence declines

South African Market Indicators
Indicators Close 1D% YTD%
All Share 85949.77 -0.52 11.78
Financial 15 21456.63 0.79 20.05
Industrial 25 117442.8 -1.26 13.23
Resource 10 57080.45 -0.98 -0.79
Property - Total Return 2435.942 0.89 30.70

The Top-40 index in South Africa closed down 0.52% on Tuesday, as business confidence declined in September due to reduced vehicle and retail sales and a drop in building plan values. Despite this, the business sentiment has been positive overall since May's election. The central bank announced a shift in its policy focus toward tracking core inflation and inflation expectations as price pressures ease.
Global Markets
Investors await upcoming earnings and key economic data

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42740.42 -0.75 13.40
S&P 500 US 5815.26 -0.76 21.92
CAC 40 FRA 7521.97 -1.05 -0.28
DAX 30 GER 19486.19 -0.11 16.32
FTSE UK 8249.28 -0.52 6.67
Hang Seng HK 20318.79 -3.67 19.19
Nikkei 225 JPN 39910.55 0.77 19.26

European Market Summary
European stocks ended lower on Tuesday, impacted by declining oil and tech stocks as investors focused on earnings. In the U.K., wages excluding bonuses rose by 4.9% year-over-year from June to August, slightly down from the previous period and aligning with forecasts. Earnings including bonuses fell to a two-year low of 3.8%, possibly supporting a Bank of England rate cut in November, with market odds at 83% for a 25-basis-point reduction. Additional data showed eurozone industrial production, German producer prices, and a revised French inflation rate at 1.4% on a harmonized basis.

American Market Summary
Wall Street's major indexes closed lower on Tuesday, led by a 1% drop in the Nasdaq as chip stocks fell on demand concerns, and the energy sector dropped 3% amid declining oil prices. Earnings were mixed, with some positive financial services results, but UnitedHealth shares slid 8% after forecasting 2025 profits below expectations. Investors are now focused on upcoming earnings and key economic data, such as retail sales and industrial production. Meanwhile, San Francisco Fed President Mary Daly commented that, despite September’s rate cut, efforts to curb inflation are ongoing.

Asian Market Summary
Most Asia-Pacific markets declined this morning, led by losses in Japan's Nikkei. Investors are awaiting potential stimulus measures from China’s housing ministry, set for a briefing today, to support the real estate sector. In Hong Kong, Chief Executive John Lee will deliver his annual policy address, likely emphasizing economic recovery efforts.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.03 -7 ----
Germany 2.22 -5 -51
South Africa (10-year) 9.22 1 -152

FROM THE OFFICES OF STANLIB

09/10/2024

STANLIB - MARKET COMMENTARY - 9 OCTOBER 2024

South African Markets
SABC plans to raise funds

South African Market Indicators
Indicators Close 1D% YTD%
All Share 85491.22 -0.95 11.18
Financial 15 20929.04 -0.03 17.10
Industrial 25 118562 -1.15 14.31
Resource 10 56734.67 -2.36 -1.39
Property - Total Return 2372.62 -0.21 27.31

The Johannesburg Stock Exchange's Top-40 index fell yesterday, reflecting ongoing economic challenges. The South African Broadcasting Corporation (SABC), despite receiving its first unqualified audit in 14 years, faces an uncertain financial future, according to a media expert and former board member. To raise funds, SABC plans to auction three prime vacant land parcels in central Durban on 16 October 2024, which is anticipated to attract significant buyer interest. Meanwhile, small-cap metal alloys supplier Insimbi is projecting a headline loss in its upcoming interim results, citing low national economic growth as a contributing factor.
Global Markets
US stocks rebound

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42080.37 0.30 11.65
S&P 500 US 5751.13 0.97 20.57
CAC 40 FRA 7521.32 -0.72 -0.29
DAX 30 GER 19066.47 -0.20 13.82
FTSE UK 8190.61 -1.36 5.91
Hang Seng HK 20926.79 -9.41 22.76
Nikkei 225 JPN 38937.54 -1.00 16.36

European Market Summary
European markets closed lower on Tuesday after a turbulent start to the week, with U.K. long-term borrowing costs climbing due to uncertainty around the Labour government’s upcoming budget announcement on 30 October. Key economic data releases expected this week include German trade figures on Wednesday and U.K. economic growth data on Friday, both of which will be closely watched by investors.

American Market Summary
US stocks rebounded on Tuesday after a losing session, as oil prices eased and investors evaluated tensions in the Middle East. Technology shares led the gains, with Nvidia and Broadcom rising 4% and 3%, respectively, while Meta Platforms, Tesla, and Microsoft each climbed over 1%, and Palo Alto Networks surged 5%. Boston Federal Reserve President Susan Collins commented that she anticipates more interest rate cuts ahead as inflation decreases and the labor market cools.

Asian Market Summary
Chinese stocks experienced another volatile trading session this morning, as Asia-Pacific markets showed mixed performance. Investors are closely watching policy moves from the Reserve Bank of New Zealand, which cut its policy rate by 50 basis points to 4.75%, and the Reserve Bank of India, which is expected to maintain its rate at 6.5%. Meanwhile, markets in South Korea are closed for a public holiday.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 4.01 -1 ----
Germany 2.24 -1 -64
South Africa (10-year) 9.24 3 -170

FROM THE OFFICES OF STANLIB

02/10/2024

STANLIB - MARKET COMMENTARY - 2 OCTOBER 2024

South African Markets
The Top-40 index remains mostly unchanged

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86619.39 0.08 12.65
Financial 15 21018.54 -1.01 17.60
Industrial 25 119690.3 -0.10 15.40
Resource 10 59310.97 2.53 3.09
Property - Total Return 2407.144 -0.68 29.16

On the Johannesburg Stock Exchange, the Top-40 index remained mostly unchanged on Tuesday. South African manufacturing activity improved in September due to stronger demand and a positive outlook from an interest rate cut. Capitec Bank, based in Stellenbosch, reported a 36% rise in earnings to R6.4 billion for the six months ending 31 August 2024 and declared a 36% higher interim dividend of 2,085 cents.
Global Markets
Investors grow cautious after Iran fire missiles at Israel

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42156,97 -0.41 11.85
S&P 500 US 5708,75 -0.93 19.68
CAC 40 FRA 7574,07 -0.80 0.41
DAX 30 GER 19213,14 -0.58 14.69
FTSE UK 8276,65 0.48 7.03
Hang Seng HK 21133,68 ---- 23.97
Nikkei 225 JPN 38651,97 1.93 15.50

European Market Summary
European stocks fell on Tuesday, reversing earlier gains due to concerns over a potential attack by Iran on Israel. Euro zone inflation dropped to 1.8% in September, below forecasts and the lowest since mid-2021, raising the likelihood of another interest rate cut by the European Central Bank. However, manufacturing activity in the euro zone saw its sharpest decline of the year in September, with Germany's sector contracting at its fastest pace in a year.

American Market Summary
U.S. stocks fell on Tuesday, with the Nasdaq dropping over 1%, as investors grew cautious after Iran fired missiles at Israel. While markets recovered slightly from the day’s lows, concerns remained due to the Middle East conflict, along with upcoming U.S. jobless claims data and payroll reports. Economic uncertainty also rose due to a port strike on the East and Gulf coasts, which, though not as severe as pandemic disruptions, still impacts the economy and complicates decisions for Federal Reserve policymakers. Meanwhile, U.S. job openings rebounded in August, and manufacturing activity slightly missed expectations in September.

Asian Market Summary
Asia-Pacific markets traded lower this morning following the inauguration of Japan's new Prime Minister, Shigeru Ishiba, who replaced Fumio Kishida. Analysts believe Ishiba's leadership may give the Bank of Japan more room to raise interest rates. In South Korea, consumer inflation rose 1.6% in September, lower than the 1.9% expected by economists. Additionally, South Korea's factory activity saw its sharpest decline in 15 months, with a purchasing managers' index of 48.3, signalling weakened overseas demand.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 3.74 -4 ----
Germany 2.03 -9 -80
South Africa (10-year) 8.97 12 -194

FROM THE OFFICES OF STANLIB

01/10/2024

STANLIB - MARKET COMMENTARY - 1 OCTOBER 2024

South African Markets
South Africa records a trade surplus

South African Market Indicators
Indicators Close 1D% YTD%
All Share 86548.42 -1.18 12.56
Financial 15 21233.65 -1.45 18.80
Industrial 25 119804.9 -0.78 15.51
Resource 10 57845.1 -1.99 0.54
Property - Total Return 2423.614 -0.64 30.04

On the stock market, the Top-40 index fell by 1.26% on Monday. SARB data revealed that private sector credit growth in August rose to 4.95% year-on-year, signalling potential economic momentum for South Africa. The country posted a trade surplus of R5.63 billion ($327.70 million) and a budget deficit of R19.40 billion in August, according to data from the revenue service and National Treasury. Meanwhile, Spar Group acknowledged that its sales performance for the 47 weeks ending August 23, 2024, was below expectations.
Global Markets
Asian markets start new day lower

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42330.15 0.04 12.31
S&P 500 US 5762.48 0.42 20.81
CAC 40 FRA 7634.82 -2.01 1.21
DAX 30 GER 19324.93 -0.76 15.36
FTSE UK 8236.95 -1.01 6.51
Hang Seng HK 21133.68 2.43 23.97
Nikkei 225 JPN 37919.55 -4.80 13.31

European Market Summary
European shares declined on Monday as investors grew cautious ahead of a week filled with key economic data and remarks from ECB President Christine Lagarde. In Germany, the harmonized inflation rate dropped to 1.8% in September, down from 2% in August and slightly below the expected 1.9%. This easing inflation could increase the likelihood of another interest rate cut from the European Central Bank (ECB).

American Market Summary
The S&P 500 and Dow both reached record high closings on Monday, recovering from a brief dip after Federal Reserve Chair Jerome Powell said there’s no rush to cut interest rates further. Powell mentioned the possibility of two more rate cuts this year if the economy performs as expected. All three major U.S. stock indexes showed gains for the month and quarter. Key economic reports, such as jobless claims and monthly payrolls, are expected later this week.

Asian Market Summary
Asian stocks dipped slightly near two-and-a-half-year highs this morning. Japan's Nikkei rebounded 1.5% after a significant drop on Monday, as investors reacted to Shigeru Ishiba's potential win as prime minister. With China’s markets closed for the week and Hong Kong's Hang Seng also closed, the recent rally in Asian markets has paused. Traders are focusing on Japan’s Tankan survey, which showed steady optimism among large manufacturers (+13) and improved sentiment among non-manufacturers (+34). Japan's unemployment rate also dropped to 2.5% in August, better than expected.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 3.78 3 ----
Germany 2.12 -1 -72
South Africa (10-year) 8.85 5 -206

FROM THE OFFICES OF STANLIB

30/09/2024

STANLIB - MARKET COMMENTARY - 30 SEPTEMBER 2024

South African Markets
Local stocks close mostly higher

South African Market Indicators
Indicators Close 1D% YTD%
All Share 87579.7 0.29 13.90
Financial 15 21545.3 -0.14 20.55
Industrial 25 120741 0.93 16.41
Resource 10 59021.6 -0.32 2.59
Property - Total Return 2427.202 ---- 30.24

On the stock market, the Top-40 index rose by about 0.5% on Friday. Momentum, a JSE-listed financial services group, reported a 39% increase in headline earnings per share for the year ending 30 June 2024, though its new business profitability saw a slight decline. Meanwhile, Old Mutual Life Assurance Company was fined R15.9 million by the South African Reserve Bank (SARB) for non-compliance with certain provisions of the Financial Intelligence Centre (FIC) Act. However, R5.9 million of the fine has been conditionally suspended for 36 months.
Global Markets
Global markets trade near record levels

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 42313 0.33 12.27
S&P 500 US 5738.17 -0.13 20.30
CAC 40 FRA 7791.79 0.64 3.30
DAX 30 GER 19473.63 1.22 16.25
FTSE UK 8320.76 0.43 7.60
Hang Seng HK 20632.3 3.55 21.03
Nikkei 225 JPN 39829.56 2.32 19.02

European Market Summary
European markets closed at a record high on Friday, supported by positive economic data. Preliminary reports from France and Spain showed a sharp drop in harmonized inflation for September, raising expectations that euro zone inflation could fall below the European Central Bank's 2% target. This has fuelled optimism across markets. The euro zone's official flash inflation data for September, from Eurostat, is set to be released on Tuesday.

American Market Summary
The Dow Jones Industrial Average hit a record high on Friday, helped by a mild inflation report that raised hopes for more Federal Reserve rate cuts, benefiting small-cap stocks and leading to weekly gains for Wall Street's main indexes. While the Nasdaq and S&P 500 dipped slightly, they remained near record levels. Consumer spending rose moderately, and inflation pressures eased, according to the Commerce Department. Additionally, consumer sentiment exceeded expectations.

Asian Market Summary
Mainland China’s stocks surged while Japan’s Nikkei 225 dropped this morning as investors reacted to key economic data. China's official PMI for September was slightly better than expected at 49.8 but marked the fifth consecutive month of contraction in manufacturing. The private Caixin PMI showed a sharper decline, falling to 49.3, the fastest drop in 14 months. Meanwhile, Japan’s industrial production fell by 4.9% year-on-year in August, a larger decline than forecasted, while retail sales rose 2.8%, beating expectations.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 3.75 -4 ----
Germany 2.13 -5 -71
South Africa (10-year) 8.80 -3 -224

FROM THE OFFICES OF STANLIB

26/09/2024

STANLIB - MARKET COMMENTARY - 26 SEPTEMBER 2024

South African Markets
All eyes on inflation data

South African Market Indicators
Indicators Close 1D% YTD%
All Share 85960.32 1.40 11.79
Financial 15 21523.73 0.31 20.43
Industrial 25 116444.2 2.11 12.27
Resource 10 58217.62 2.13 1.19
Property - Total Return 2436.387 -0.07 30.73

The Johannesburg Stock Exchange's Top-40 index rose 1.5% on Wednesday, hitting a new high earlier in the session. On Thursday, investors will turn their attention to August producer inflation data, which will provide more insights into easing price pressures. This follows the South African Reserve Bank's (SARB) rate cut last week, driven by slowing consumer inflation. Additionally, central bank data showed a 0.7% month-on-month rise in the composite leading business cycle indicator for July, reflecting improvements in vehicle sales, business confidence, and money supply.
Global Markets
US markets retreat from all-time highs

Global Market Indicators
Indicators Close 1D% YTD%
Dow Jones US 41914.75 -0.70 11.21
S&P 500 US 5722.26 -0.19 19.97
CAC 40 FRA 7565.62 -0.50 0.30
DAX 30 GER 18918.5 -0.41 12.94
FTSE UK 8268.7 -0.17 6.92
Hang Seng HK 19129.1 0.68 12.21
Nikkei 225 JPN 37870.26 -0.19 13.17

European Market Summary
European stocks closed slightly lower on Wednesday after a volatile trading session. Sweden’s Riksbank cut interest rates by 25 basis points to 3.25% and hinted at the possibility of further cuts this year, including a potential 50 basis point reduction. Meanwhile, the OECD upgraded its outlook for the U.K. economy, now forecasting 1.1% growth this year and 1.2% in 2025, a significant improvement from earlier predictions. In May, the OECD had warned that the U.K. could be the worst-performing advanced economy next year.

American Market Summary
The Dow Jones Industrial Average and S&P 500 closed lower on Wednesday, retreating from recent record highs. Despite being on track for monthly gains after the Federal Reserve's September 18 rate cut, a weak consumer sentiment report raised concerns about the labour market. In August, sales of new single-family homes declined, but falling mortgage rates and home prices may boost demand soon. Investors are now focused on upcoming data for weekly jobless claims and the August U.S. Personal Consumption Expenditure (PCE) index. Remarks from Fed Governor Adriana Kugler and Fed Chair Jerome Powell's speech on Thursday are also highly anticipated.

Asian Market Summary
Asia-Pacific markets rose this morning, led by Japan's Nikkei 225 and gains in Chinese markets. Japan's Nikkei climbed after the Bank of Japan released minutes from its July meeting. Meanwhile, China's CSI 300 extended its five-day winning streak, reaching its highest level in nearly two months, following Beijing's economic stimulus measures earlier in the week. Adding to positive sentiment, Bloomberg reported that China may inject up to 1 trillion yuan ($142.39 billion) into its largest state banks to boost their ability to support the struggling economy.
10-Year Bond Yields
Yield% 1D% 1Y%
United States 3.78 6 ----
Germany 2.17 3 -62
South Africa (10-year) 8.85 ---- -193

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