Stocks Dip, Futures Steady After China Data

31/05/2021 Most Asian stocks retreated this morning and U.S. equity futures remained steady after signs China’s economic recovery may be levelling out and as investors continue to weigh global inflation risks. Japan underperformed amid concern about an extended state of emergency to curb the coronavirus. Shares fell in Hong Kong and China, where a gauge of the manufacturing industry suggested the economy’s recovery momentum might have peaked. Holidays in the US and UK will impact trading volumes globally.

The JSE tracked firmer global markets on Friday after jobless claims in the US came in better than expected while inflation there accelerated at a faster pace than anticipated. The JSE AllShare closed up 0.89% with SA Inc names topping the gainers list. We should be in for a slow day with holidays in the US and UK. IG Markets Top 40 is just 57 points lower and Tencent is up 0.91% a bit of a mixed indication.

President Cyril Ramaphosa extended a night-time curfew and reduced the permissible size of public gatherings to contain the spread of the coronavirus after a surge in infections.

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ECONOMIC DATA:

8am: April Money Supply M3 YoY, prior 3.62%
8am: April Private Sector Credit YoY, est. -0.80%, prior -1.52%
2pm: April Trade Balance Rand, est. 37.5b, prior 52.8b

European markets closed higher on Friday, hitting record highs as global stocks take heart from strong economic data out of the U.S. The pan-European Stoxx 600 ended up 0.57%, passing Thursday’s intraday record high. Financial services stocks added 1.3% to lead gains as almost all sectors and major bourses entered positive territory.
In the US the S&P 500 climbed slightly on Friday to close its fourth straight positive month amid growing optimism over the U.S. economic recovery. The broad equity benchmark ended the session up 0.1% to 4,204.11, sitting just 0.8% from its record high. The Dow gained 64.81 points and the tech-heavy Nasdaq inched up 0.1% to 13 748. The blue-chip Dow and the S&P 500 advanced 0.9% and 1.2% last week, respectively, both breaking a two- week losing streak. The Nasdaq rose 2.1% to post its best weekly performance since April 9. For the month of May, the 30-stock Dow and the S&P 500 gained 1.9% and 0.6%, respectively, posting their fourth up month in a row. The tech-heavy Nasdaq, however, suffered a 1.5% loss this month for its first negative month in seven.
Shares in Asia-Pacific were mixed in Monday trade, as investors reacted to the release of China’s official manufacturing Purchasing Managers’ Index for May. China’s official manufacturing Purchasing Managers’ Index for May came in at 51.0. That compared against analyst expectations for a reading of 51.1 in a Reuters poll. The May figure was also a slight decrease from the previous month’s reading of 51.1. Japan’s retail sales rose 12% in April as compared with a year earlier, according to government data released Monday .That was against a median market forecast for a 15.3% rise, according to Reuters. The Nikkei is 0.91% lower. MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.36%.
Gold prices held firm above the key $1,900-level on Monday after U.S. consumer prices rose more than expected in April and supported the metal as an inflation hedge. Gold spot is $ 1906 up 0.16%, Platinum + 0.38% $ 1188 and Palladium + 0.47% $ 2838.
Oil prices climbed in early Asian trade on Monday, underpinned by the bright outlook for fuel demand growth in the next quarter, while investors looked ahead to the OPEC+ meeting this week for supply guidance. Brent + 0.67% $ 69.18, WTI+ 0.72% $ 66.79.
Have a really good week ahead and stay safe.