02/10/2020 Breaking news this morning is that Pres Trump and the First Lady test positive for covid 19. Asian markets and US Futures all turn sharply lower on the news, Dow Futures down 500 points, S&P down 55 points. S&P 500 contracts had dipped a bit earlier after the House of Representatives passed a $2.2 trillion Democrat-only fiscal stimulus package that Republicans reject. Markets in China, Hong Kong, Taiwan, India and South Korea are shut today for holidays.
On the local front the JSE All Share closed up 0.34% on the back of hopes on US stimulus and positive local data. IG Top was 80 points lower prior the Trump news now down 560 points.
The ruling African National Congress’ National Executive Committee holds a virtual meeting to discuss a draft economic recovery plan before it is submitted to the cabinet for approval. The meeting starts at 10am.
• Sasol Sells 50% Interest in LCCP to LyondellBasell For $2b.
• Comair says, SAA problems create opportunity – Novick
The pan-European Stoxx 600 closed 0.2% higher, with retail stocks adding 2.4% while oil and gas stocks slid 1.7%. European data was also in focus Thursday morning. The final September manufacturing PMI (purchasing managers’ index) reading for the euro zone was in line with forecasts at 53.7, indicating a continued recovery for the bloc’s factory activity, fueled largely by industrial powerhouse Germany. Meanwhile, the euro zone August jobless rate increased 0.1% month-on-month to 8.1%.
Stock futures plunged in earlier after President Donald Trump said he tested positive for the coronavirus. Futures tied to the Dow Jones Industrial Average plummeted 500 points. S&P 500 futures and Nasdaq 100 futures were also deeply in negative territory. Earlier, investors watched stimulus developments after the House passed a $2.2 trillion coronavirus stimulus plan on Thursday night, despite Democrats and the Trump administration remaining divided on key items in the legislation. The bill likely will not get through the Republican-held Senate and become law. Senate Majority Leader Mitch McConnell has opposed the legislation as his caucus resists spending trillions more on the federal response to the pandemic.
The Dow closed 35 points higher for a gain of 0.1%, while the S&P 500 advanced 0.5%. The tech-heavy Nasdaq Composite was the relative outperformer, gaining 1.4%. Later today investors will get a read on the state of the ongoing economic recovery when September’s jobs report is released at 14.30. The final jobs report ahead of the election is expected to show a slowdown from August’s levels. Surveys expect 875K non-farm pay rolls added, down from 1.37 million in August.
• Asia this morning has also turned negative on the Trump news with the ASX 200 down 1.38%. Australia’s retail sales data for August fell 4% on a seasonally adjusted basis, according to data from the country’s Bureau of Statistics. That followed a rise of 3.2% in July. Japan’s Tokyo Stock Exchange returned to trade today following a halting of trade yesterday caused by a hardware glitch, the Nikkei is down 0.75%. Markets in China, Hong Kong, Taiwan, South Korea and India are closed for holidays.
• Gold has gained more than 2% so far this week, its biggest weekly percentage gain since week ended August 7, currently trading at $ 1906. Oil is under pressure on renewed virus concerns, Brent – 2.47% $ 39.93 and WTI – 2.71% $ 37.60.
• Have a great day and a better weekend.