Total mining output probably fell 20% in June from a year earlier

13/08/2020 Total mining output probably fell 20% in June from a year earlier, according to the median estimate of five economists surveyed by Bloomberg, which would extend the decline to nine straight months after a 2% drop in March. The monthly decline is seen at 1%. Statistics South Africa is scheduled to publish the data at 11:30am.

  • South Africa Central Bank Head Shuns Calls for Broader Mandate
  • President Cyril Ramaphosa to chair Nedlac forum
  • Gold’s Wild Ride Continues With Prices Rebounding After Rout
  • South Africa Says Virus Outbreak May Have Reached Its Peak
  • (ABG SJ): Absa Sees First-Half Profit Falling as Much as 85% on Virus
  • (FSR SJ): FirstRand Sees Annual Profit Down as Much as 45% on Impairments
  • (PPC SJ): South Africa’s Biggest Cement Maker PPC Mulls Rights Issue
  • (HAR SJ): Harmony Gold Sees Mining Volumes Decline; Costs Surge
  • (RDF SJ): Redefine Sees Decline of at Least 45% in FY Distrib Income/Shr

EARNINGS:

  • Exxaro 1H Net Falls 33%; Sees Challenging 2H on Virus
  • FAMOUS BRANDS LIMITED – Further cautionary announcement – SAYS GBK BOARD CONTINUES TO EXPLORE ALL OPTIONS
    *ARB HOLDINGS SEES FY EPS 30%-40% LOWER Y/Y

ECONOMIC DATA:

  • 11:30am: (SA) June Mining Production YoY, est. -20%, prior -29.8%
  • 11:30am: (SA) June Mining Production MoM, est. -1%, prior 44.%
  • 11:30am: (SA) June Platinum Production YoY, prior -27.3%
  • 11:30am: (SA) June Gold Production YoY, prior -20.3%

MARKETS
The FTSE/JSE Africa All-Share Index closed up 0.4% to 57,417 supported mainly by heavyweights Naspers and Prosus as well as Platinum counters that had good gains yesterday, with Banks on the backfoot after negative trading statements by Absa and Firstrand. The Rand was up 0.4% to 17.40 per US$, with the Yield on 10 year govt rand bonds that rose 1.2 bps to 9.291%.

EU/UK
European stocks closed higher on Wednesday following a choppy start to trading, as investors continued to bet on an impending economic recovery from the coronavirus crisis. The pan-European Stoxx 600 closed up 1.1%, with most sectors and major bourses in positive territory. Telecoms shares added 1.7% to lead gains while the travel and leisure sector bucked the positive trend with a 1% decline. In London the FTSE 100 put on 2.04%, the German Dax gained 0.86%, with the Paris CAC 40 adding 0.90%. Figures published yesterday revealed that the U.K. had officially entered a recession after gross domestic product contracted by a record of 20.4% in the second quarter of 2020, compared to the previous three months. However, an 8.7% rebound in June offered some cause for optimism.
U.S.
Stocks rose sharply on Wednesday putting the S&P 500 just below its all-time high set in February, as shares of the major tech companies recovered some of their steep losses from the previous session. The S&P 500 gained 1.4%, its biggest one-day jump since July 6, to close at 3,380. In the final hour of trading, the broader market index briefly traded above its record closing high of 3,386.15. The index also ended the session just 0.4% shy of its intraday all-time high of 3,393.52. The Dow jumped 289 points, or 1.1%, to close at 27,976, with the Nasdaq that outperformed, rallying 2.1% to 11,012. Facebook, Amazon and Netflix were all up at least 1.5% while Alphabet advanced 1.8%. Microsoft and Apple gained more than 2.8% each. Stocks that would benefit from the economy reopening lagged, however. Cruise operator Carnival dropped 4%. JPMorgan Chase, Bank of America and Citigroup were all lower.
ASIA
Most Asian stocks advanced this morning and the region was on course to erase this year’s declines as the global equity rally that’s driven shares higher since March continued to strengthen. Shares in Japan saw the bulk of gains, with South Korea and China also higher. Hong Kong dipped, and Australian equities underperformed as earnings at some firms disappointed. The Nikkei is up 1.78%, the Hang Seng down 0.23% (Tencent -1.4%) and the Shanghai higher +0.16%. In OZ the ASX 200 is 0.67% lower, with the metals & mining index flat. Victoria state tightened restrictions as cases jumped, while the Philippines imposed a stricter lockdown for Manila and nearby areas. Stocks in Manila had the biggest drop in Asia, down more than 3%. Tension between the U.S. and China is another threat to risk appetite. The Trump administration will announce measures shortly against “a broad array” of Chinese-owned software deemed to pose national-security risks, U.S. Secretary of State Michael Pompeo said.
COMMODITIES
Oil held gains near $43 a barrel after closing at a five-month high as U.S. weekly inventory data buoyed optimism that a sustained recovery in energy demand in the world’s largest economy is underway. Futures in New York were steady after jumping 2.6% Wednesday as the Energy Information Administration reported crude stockpiles dropped for a third week, the first time that’s happened this year.
Gold headed for back-to-back gains following wild swings as investors weighed the outlook for the metal’s record-setting rally, tracking moves in bond yields, a weaker dollar, as well as an uptick in risk appetite. Spot bullion climbed, while futures were little changed. This comes after prices tumbled on Tuesday, then swung in a wide arc on Wednesday, as last-week’s rally likely spurred some technical selling and profit-taking. Platinum and Paladium prices are both better this morning.