Oils Slips, Markets Drop, Treasury Yield Near Five-Week Low On Virus Concerns

21/04/2021Asian markets took a tumble on Wednesday and U.S. futures declined as rising corona virus cases globally renewed concerns about the economic impact. Stocks skid in Tokyo and Hong Kong after second straight day of losses on Wall Street. Nasdaq 100 futures underperformed. S&P 500 contracts fell, with investors showing caution ahead of the brunt of the earnings season. Oil down over renewed rise in the number of covid-19 cases and a surprise build in U.S. crude oil supplies renewed fuel demand worries. Brent oil futures were down0.71% to $66.10 and WTI futures fell 0.78 % to $62.17. The number of corona virus continues to soar in India, the third-largest oil importer. Gold up as softer U.S. Treasury yields increased demand for the safe-haven yellow metal. Gold futures were up 0.13% to $1,781.40.

The All-share slumped 1.85% to 66,835.52 points and the Top-40 down 1.94% on Tuesday. Absa’s share price fell 4.1% to R120.68 by the close. This is after the third-biggest banking group agreed to part ways with the group CEO Daniel Mminele due to differences with executives over the strategic direction. British American Tobacco (BTI) dropped almost 8%, the most in more than a year, on the JSE on a report that the US might order a reduction in the nicotine content of cigarettes.

NEWS:
• Gold Rises as Bond Yields Decline; Palladium Slips From a Peak
• Dispute With Board Sees Absa Bank CEO Depart After 16 Months
• Tencent Dangles Billions in Aid As Antitrust Scrutiny Grows
EQUITY PREVIEW:
• Heineken 1Q Volume Likely Down as Europe Takes Hit: 1Q Preview
• Distell 9-Month Revenue, Volume Rise 8.1%, 6% From Year Ago
• Barclays Initiates Coverage of African Telecoms, Prefers Vodacom
• Capitec Falls; Avior Keeps Underperform Rating, Seen Overvalued
• MTN Group Rated New Underweight at Barclays
• Vodacom Rated New Overweight at Barclays
EARNINGS:
• Pick n Pay Stores Ltd. (PIK SJ)
ECONOMIC DATA:
• 10am: March CPI MoM, est. 0.8%, prior 0.7%
• 10am: March CPI YoY, est. 3.3%, prior 2.9%
• 10am: March CPI Core MoM, est. 0.6%, prior 0.6%
• 10am: March CPI Core YoY, est. 2.7%, prior 2.6%
CORPORATE EVENTS:
• Earnings Calls: PIK SJ
• Sales Results: BHP LN, QLT LN
EX DIVIDEND:
• RCL SJ, REM SJ, SAC SJ, TLM SJ, TPF SJ

EU/UK/US
Tobacco companies weighed London stocks and many regional indexes edged off recent highs. FTSE 100 fell 2%, while Germany’s DAX was down 1.6% and the pan-regional STOXX 600 index dropped 1.9% in its biggest one-day decline this year. The European STOXX 600 has hit a series of all-time highs this month and climbed about 9% so far in 2021 – somewhat in line with New York’s S&P 500.

The S&P 500 slipped 0.68% on Tuesday as major airlines and cruise lines fell on a rising global tally of Covid-19 cases and potential new restrictions on international travel. The Dow gave up 0.75% on the day, while the Nasdaq saw the session out 0.98% weaker. Netflix Inc said slower production of TV shows and movies during the pandemic hurt subscriber growth in the first quarter, sending shares of the world’s largest streaming service down 11% on Tuesday. U.S index futures are under the waterline, with the Nasdaq underperforming.

ASIA
Japan’s government is considering a state of emergency for Tokyo and Osaka as new COVID-19 case numbers surge, Nikkei225 tumbled 2.01%. Australia, the ASX 200 was down 0.64%, Hong Kong’s Hang Seng Index fell 1.67% (Tencent currently on the backfoot 1.67%), while the Shanghai Composite index was up 0.15% with healthcare and banking stocks leading the gains, as investors cheered upbeat quarterly earnings results.