Asian Shares Mixed After U.S Tax Proposal Riles Wall Street; Crypto Currencies Plunge

23/04/2021 Asian stock markets were mixed on Friday following broad-based declines in U.S. benchmarks as investors weighed a proposal for higher taxes on the wealthy to help pay for President Joe Biden’s social plan. Shares outperformed in China and Hong Kong (Tencent up 0.81%). U.S. contracts edged up after the steepest decline in five weeks. Biden administration is considering raising the tax on capital gains to 39.6% for those earning more than $1 million a year. Bitcoin’s dropped below the $50,000 level to a low of $48,338.37. Ethereum was last down about 7% at $2,240.65. Brent oil futures were up 0.52% to $65.74 and WTI futures rose 0.68% to $61.85.

Locally, the JSE closed down 0.26% on the day to 66,971 points – pulled back by platinum stocks. Precious metals/mining index retreated 1.90% on the day as commodity prices tapered off on higher Covid-19 cases in India. The Top- 40 gave up 0.35%. Resources fell 0.91%, while listed property gained 0.49%. Rand steady 0.08% at R14.30/$.

NEWS:
• Engen to Convert Oldest South Africa Refinery to Import Terminal
• Ex-Deloitte Auditor Faces Disciplinary Action Over Steinhoff
• South Africa Set to Use J&J Shots After Resolving Contract Spat
• Prosus, Tencent Invest $80 Million in European Online Broker BUX
• Kumba Iron Ore Reaps Price Bonanza on Buoyant Demand
• S. Africa’s J&J Vaccine Rollout May Resume Next Week: Reuters
• Palladium Holds Near Record as Auto Demand Spurs Deep Deficit
• South Africa President to Participate in Biden’s Climate Summit
EQUITY PREVIEW:
• Pick n Pay Stores Raised to Hold at SBG Securities; PT 61 rand
• South African Retailers Fall as Clicks Earnings Disappoint
• Anglo Rises as Citi Sees Strong Trends for Key Commodities
• Kumba Iron Ore Reaps Price Bonanza on Buoyant Demand
• Anglo American 1Q Total Platinum Prod. 1.02m Oz, up 7% YoY
• Watch Luxury Stocks as Hermes Asian Sales Growth Beats Estimates
• Clicks 1H Profit After Tax 891.5M Rand Vs. 850.1M Rand Y/y
• Netcare Reports Growth in 1H, Improving Revenue & Ebitda vs 2H
MEDIA SUMMARIES:
• Daily Maverick: Bad vibrations: Zweli Mkhize associate and Digital Vibes in ‘fraudulent’ tender mess
• Financial Mail: GIULIETTA TALEVI: Astral Foods is winning the power play
• Moneyweb: PnP is open to buying Cambridge Food – Brasher

EU/UK/US
European shares closed in positive territory after the ECB said it would accelerate its bond purchases and that rate-setters were not discussing phasing out their stimulus. The pan-European Stoxx 600 index rose 0.68%, alongside a 0.82% advance for the German Dax, while the FTSE100 climbed 0.62%. Swedish truckmaker AB Volvo jumped 4.6% as it beat market expectations for first-quarter core earnings on the back of surging demand. Nestle rose 2.2% after reporting its strongest quarterly sales growth in 10 years, helped by demand for coffee, dairy and petcare products. Credit Suisse fell 2% after it posted a 757 million Swiss franc pre-tax loss in the first quarter.

Wall Street stocks closed in negative territory on Thursday, despite a better-than-expected jobless claims report, after the Biden administration was said to propose almost doubling the capital gains tax rate for individuals earning $1 million or more.
The Dow was down 0.94%, alongside the S&P 500 giving up 0.92%, while the Nasdaq pulled back 0.94% at 13,818.41. Bank stocks sunk after Bloomberg reported that federal tax rates for wealthy investors could be as high as 43.4%, giving traders reason to cash out before any legislative moves materialize. All thee main gauges, index futures, are firm on Friday morning.

ASIA
MSCI ex. Japan shook off early small losses to rise 0.33%. Chinese blue-chip shares rose 0.74%, supported by consumer staples, health care and financial firms. Hong Kong’s Hang Seng rose 0.90% ,Japan’s Nikkei stock index slid 0.76%, while the Aussie’s ASX200 is on the backfoot 0.13%. The yield on benchmark 10-year Treasury notes was little changed at 1.554% after the capital gains tax reports pulled yields lower on Thursday. Spot gold rose about 0.07% to $1,785
31 per ounce.