Dow surges 250 points | Best day for Nasdaq since September | Apple surges ahead of iPhone launch

13/10/2020 U.S. futures slipped and Asian stocks are mixed this morning as investors weighed a potential setback on progress toward a coronavirus vaccine against an overnight surge in technology shares. Hong Kong scrapped its trading session as a tropical storm neared The dollar and Treasuries advanced. S&P 500 contracts retreated after a report that Johnson & Johnson’s Covid-19 vaccine study has been paused due to an unexplained illness in a participant. The JSE Top 40 futures are flat in early trade.
Locally the FTSE/JSE Africa All-Share Index closed up 0.7% to 55,552 supported by the platinum and banking sectors up 2.18% and 1.93% respectively, with gold and retailers on the backfoot. The Rand was down 0.2% to 16.49 vs the USD, with the Yield on 10 year govt rand bonds that fell 4.9 bps to 9.44%.
Mining production probably fell 8.4% in August compared with a year earlier, according to the median estimate of six economists in a Bloomberg survey. Statistics South African will publish the data at 11:30am.

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    ECONOMIC DATA:
  • 11:30am: August mining production y/y, est. -8.35%, prior -9.1%; m/m est. 3.4%, prior 20.2%
  • August platinum production y/y, prior 4.6%
  • August gold production y/y, prior -10.2%
    Trading Statement:
    PSG Sees Net Asset Value Per Share at Aug. 31 at 73.27 Rand
    SEES 1H EPS PROFIT OF B/W 118 RAND & 119 RAND
    SEES 1H HEPS LOSS OF B/W 14.00 RAND & 14.30 RAND

EU/UK
European stocks ended the day higher yesterday, tracking gains in Asia on the back of strong Chinese data, while progress on a U.S. stimulus package was also in focus. The pan-European Stoxx 600 closed 0.7% higher, with sectors including autos, household goods, tech and utilities all adding more than 1%. The travel & leisure and retail sectors both ended the day in the red, as did banks and oil and gas. London’s FTSE100 however was down 0.25%, with Paris’ CAC-40 gaining 0.66%, while the German DAX saw the session out 0.67% higher. The pandemic continues to cause widespread concern in Europe with governments resorting to localized lockdowns to stem the spread of the virus. Spain’s government has caused controversy after it imposed a state of emergency on Madrid and the U.K. government announced a three-tier system of local restrictions for England on Monday.
US
U.S. stocks rose sharply on Monday as tech shares outperformed while investors monitored stimulus negotiations in Washington. The Dow rose 250 points, or 0.9%, to close at 28,837. The S&P 500 gained 1.6% to end the day at 3,534 and the Nasdaq advanced 2.6% to 11,876. It was the Nasdaq’s best day since Sept. 9, when it rallied 2.7%. Apple jumped 6.4% — the stock’s biggest one day gain since July 31 — as investors looked ahead to a key event for the company. Apple is expected to unveil its first 5G iPhone today. Facebook and Amazon advanced 4.3% and 4.8%, respectively. Alphabet popped 3.6% and Microsoft gained 2.6%. Yesterday’s rally came even as chances for another round of stimulus before the election appeared to dim over the weekend. Investors are also bracing for the third-quarter earnings season. Several major banks and airlines are to report their results this week, including JPMorgan and Delta Air Lines later today. While results for the period are expected to decline significantly, traders believe results could come in much better than expected.
ASIA
Asian stocks are mixed this morning as investors weighed a potential setback on progress toward a coronavirus vaccine against an overnight surge in technology shares. Investors are also monitoring the Chinese yuan’s movements after the People’s Bank of China announced a rule change that made it cheaper to short the yuan. China’s exports rose for the fourth straight month in September while imports surged, pointing to further recovery in the month for global trade and a robust domestic rebound. Exports grew 9.9% in dollar terms in September from a year earlier, while imports rose 13.2%, the customs administration said Tuesday. That left a trade surplus of $37 billion for the month. Economists had forecast that exports would increase by 10% while imports would edge up 0.4%. Stocks remained higher in Australia, fluctuated in Japan and dipped in South Korea and China, with Hong Kong scrapping its trading session as a tropical storm neared.
COMMODITIES
Oil steadied in Asia after falling the most in more than a week as several supply disruptions that have supported prices subsided. Futures in New York traded near $39 a barrel, up 0.99%, after dropping 2.9% on Monday. Gold retreated for a second straight day as investors weighed uncertainty surrounding U.S. stimulus, together with the looming presidential election and a rebound in the dollar, with Platinum and Palladium all a tad lower.
Wishing You All A Good Day Ahead