08/07/2021 Markets all softer and Jacob hands himself over………..
Asian markets trade lower and bonds held an advance amid concerns China’s economic rebound may be peaking and as traders digested Federal Reserve minutes indicating a plan for tapering stimulus may be edging closer. Hong Kong underperformed as technology companies remained under pressure, Tencent down 3.82%. China has moved to increase oversight of foreign listed firms, citing security concerns, which has put pressure on tech stocks this week. Rising Covid-19 numbers in parts of Asia is also reducing appetite for riskier assets. European and US futures are softer despite the S&P 500 and Nasdaq closing at record highs overnight.
Locally the All Share closed at a three week high up 1.45 %. The market was helped by miners as the Platinum names led the gainers. AMS + 5.02%, NHM + 4.46% and IMP up 3.23 %. NPN and PRX posted solid gains of 1.89 and 1.54 percent respectively despite Tencent being down 2.7%. Shares in Steinhoff International rose 21.76% to R1.76, the most since mid-February, after it said Hamilton, a litigation-funding company based in Ireland that is seeking more than R16bn on behalf of retail investors, asset managers and pension funds in SA, had withdrawn an appeal relating to voting procedures in Steinhoff’s proposed settlement plan. We looking at a softer open as Tencent continues to slide now down 3.82%, precious metals softer and US and European futures lower. IG Markets Top 40 is down 270 points.
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European markets are set to open lower after a solid day yesterday, the FTSE, CAC and DAX all made solid gains with the DAX gaining 1.17 percent. The lower open set for Europe reflects cautious sentiment in Asia-Pacific and the U.S., despite the S&P 500 and Nasdaq Composite closing at record highs overnight.
Overnight in the US the S&P 500 rose 0.3% to an all-time high of 4358, while the Dow advanced 104 points to 34681. The technology-heavy Nasdaq closed just above its own flatline to eke out a record close. Popular internet and technology stocks again outperformed the broader market as investors bought equity in companies that prioritize growth instead of the reopening names in the energy and retail sectors that proved popular in the first half of the year. Looking ahead to the latest jobless claims figures later today economists expect to see 350,000 first-time applicants for unemployment benefits for the week ended July 3.
Shares in Asia-Pacific mostly declined in Thursday trade, as Chinese tech stocks in Hong Kong came under pressure after regulatory fears resurfaced. Beijing recently announced a stepping up in oversight on Chinese listings in the U.S., many of whom are tech companies. That came after a recent crackdown on ride-hailing giant Didi and other tech firms, which once again raised concerns over the regulatory outlook. The Hang Seng is down 2.58%, Tencent down3.82%. The ASX 200 is bucking the trend trading up 0.23% helped by the mining index which Is up 0.88% MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.07%.
Gold is a tad softer just below the $ 1800 level as lower U.S. Treasury yields countered a stronger dollar after minutes from the Federal Reserve’s last meeting showed that the central bank is moving towards tapering its asset purchases as soon as this year. Benchmark U.S. 10-year Treasury yields dropped to their lowest since Feb. 19, reducing the opportunity cost of holding non-interest bearing gold. However, the dollar index traded near the highest in three months versus its rivals, making gold more expensive for other currency holders. Spot Gold is 0.28 % lower at $ 1798, Platinum down 0.81% $ 1079 and Palladium 0.57% lower at $ 2837.
Oil prices fell for a third day amid anxiety that supply may rise after the collapse of this week’s talks among major producers, potentially causing the current output agreement to be abandoned. Brent prices have fallen about 5.3% since Monday’s close after talks between OPEC+, fell apart when de facto leader Saudi Arabia refused demands from the United Arab Emirates to raise its output under the group’s supply cut agreement. Brent is 0.11% lower at $ 73.33.