21/10/2020 Treasury yields rose and U.S. futures extended overnight gains amid optimism about progress on stimulus talks in Washington. The dollar retreated. The benchmark 10-year yield climbed above 0.8% to a four- month high after House Speaker Nancy Pelosi said she remains hopeful of a deal before the election. S&P 500 contracts and European futures are edging higher this morning, with shares in Asia mostly better (Tencent also slightly higher in HK) . The JSE Top 40 futures are indicating a slightly better start, up 155 points, or 0.30%.
Locally the FTSE/JSE Africa All-Share Index closed up 0.2% to 55,271, mostly supported by the platinum sector that rose 1.0%. Clicks gained the most in the top 40, adding 7.15% to its share price, with Capitec gaining 3.1%. On the losing end were Sasol on the back of a lower oil price as well as the gold sector that shed 2.03%. The Rand was up 0.3% to 16.46 vs the USD, with the Yield on 10 year govt rand bonds that rose 2.4 bps to 9.291%.
Both houses of parliament will hold a debate about President Cyril Ramaphosa’s Economic Reconstruction and Recovery Plan. Lawmakers will hold hearings in parliament on the Protection of Investment Act, the Gender Based Violence Bill, and the Passenger Rail Agency of South Africa’s plans to deal with damage to its infrastructure caused by vandalism and theft. The Zondo Commission, which is holding an inquiry into state corruption, will hear evidence from officials at Transnet, the state-owned rail, ports and company
- Gold Swings as U.S. Stimulus Talks Approach Pelosi‘s Deadline
- (CLS SJ): Clicks Gains After Peer’s Upgrade, Also Boosted by Virus Worries
- (DGH SJ): Distell’s Overall Performance Is Tracking Ahead of Expectations
- (SPG SJ): Super Group Raised to Buy at Investec; PT 24.50 rand
- Long4Life (L4L SJ)
- Annual general meetings: DGH SJ
European stocks closed mostly lower yesterday, as concerns about the coronavirus in Europe, and a deadline for U.S. fiscal stimulus to be agreed, weighed on market sentiment. The pan-European Stoxx 600 closed down by 0.2%, paring earlier losses, with Germany’s DAX and France’s CAC shedding 0.9% and 0.3% respectively, while the U.K.’s FTSE 100 was marginally higher. In terms of sectors, tech stocks led the losses, down 1%, while banks climbed 0.9%. UBS reported a net income of $2.1 billion for the third quarter, up 99% from the same period last year, beating analysts expectations of $1.5 billion, with its share price rising almost 3% on the news. Swiss company, Logitech surged to the top of the European benchmark during yesterday’s trade after the computer equipment maker reported a 75% jump in second-quarter sales, citing a boost in demand as many people adapt to working from home amid the pandemic, with its share price jumping almost 16%. Meanwhile, rail booking app Trainline fell nearly 13% after announcing that CEO Clare Gilmartin will step down at the end of February 2021. Swedish telecoms operator Tele2 fell almost 5% after the company reported core earnings in line with market expectations and left its outlook for operating profit unchanged.
Stocks rose on Tuesday after House Speaker Nancy Pelosi signaled Democrats and the White House were making progress in negotiations for a new fiscal stimulus deal. The Dow Jones closed 113 points higher, or 0.4%, at 28,308. The 30-stock average was briefly up more than 300 points. The S&P 500 gained 0.5% to end the day at 3,443 and the Nasdaq Composite advanced 0.3% to 11,516. Shares of Carnival Corp. and American Airlines rose 3.3% and 1.9%, respectively, as company groups that would benefit the most from the economy reopening led the way higher. Kohl’s jumped 6.6% and Nordstrom advanced 1.2%. Stocks also rose after the Moderna CEO told the Wall Street Journal that the company’s coronavirus vaccine could be available for emergency use in December if it gets positive results from its interim trial in November. Dow member Travelers jumped 5.6% on the back of better-than-expected quarterly results.
Asian markets are mostly better, with shares seeing modest gains in Japan, Hong Kong and South Korea, and slipping in China. The Nikkei is 0.31% better, the Hang Seng 0.85% higher, with the Shanghai slighly lower -0.17%. In OZ the ASX 200 gained 0.12%, with the metals & mining index adding 0.58%.
Oil dropped toward $41 a barrel in New York after an industry report pointed to a surprise increase in American crude stockpiles, countering optimism over a potential U.S. stimulus agreement. Gold headed for a third daily advance after House Speaker Nancy Pelosi fueled bets that U.S. lawmakers may clinch a pre-election spending deal, with spot gold that rose 0.4% to $1,915.26.
Wishing You All A Good Day Ahead