Asian Markets and US Stock futures Drift Slightly Lower After Nasdaq Powers To a Record High

18/08/2020 Asian stock markets and U.S. futures drifted on Tuesday after the S&P 500 Index failed at another attempt to break a record high amid an impasse over U.S. stimulus measures. Markets were little changed in Japan and Hong Kong, rose in China and Australia. S&P 500 futures were little changed. The Nasdaq 100 outperformed. Locally, the JSE was pulled up by surging gold miners, closing 0.63% to 57,435.08 points and the Top-40 0.76%Gold miners rose 5.03%, with DRD Gold gaining 8.84% and Harmony Gold advancing 6.25% at the end of trading. Hospitality stocks climbed on eve of move to level 2 of the lockdown, with Sun International rising 7.62% and City Lodge 3.27%. Rand marginally former 0.08% to 17.5020. Yield on 10 year govt rand bonds rose 8.8 bps to 9.276%. We are looking forward to a flat-to-positive opening of the local markets this morning – Top-40 futures up 60 points up on IG markets.

The National Treasury will sell 6.6 billion rand of bonds due 2026, 2032 and 2048 at the weekly fixed-rate debt auction. The sale starts at 11am.
BOND SALES/PURCHASES
11am: South Africa to Sell 2.2 Billion Rand of 10.5% 2026 Bonds
11am: South Africa to Sell 2.2 Billion Rand of 8.25% 2032 Bonds
11am: South Africa to Sell 2.2 Billion Rand of 8.75% 2048 Bonds
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• NORTHAM PLATINUM LIMITED – PURCHASE OF R804.6M OF ZAMBEZI
• CORPORATE EVENTS: Annual general meetings: BWN SJ
• South Africa moves to level 2 lockdown on Tuesday allowing the reopening of some industries as well as the sale of alcohol and tobacco.

EU/UK
European stock markets closed higher as China-exposed miners jumped on fresh stimulus for the world’s second-largest economy. The pan-European STOXX 600 index ended 0.3% higher, with miners jumping 1.7% after fresh liquidity moves by the central bank in China – the world’s top metals consumer. Chipmakers also rose, while luxury stocks such as LVMH and Burberry climbed between 0.4% and 1.9% after Jefferies analysts said in a note that the strength of their businesses in China could help them to gain market share. At the end of trading: the London’s FTSE100 firmed up 0.61%, the CAC-40 gained 0.18%, while the DAX saw the session out 0.15% firmer. Brexit Talks Resume With Just Seven Weeks Left to Reach a Deal.

US
Wall Street was mostly higher on Monday, and the S&P 500 briefly rose above its February 2020 record closing high again during intraday trading. Amazon led a rally in mega-cap tech stocks, and Tesla jumped more than 11% to a record high. The Nasdaq Composite closed at a record high, lifted by Nvidia – the chipmaker – surging 6.7%. US stock index futures are a tad softer on Tuesday: Dow futures on the backfoot 10 point, 0.03% doen, with the S&P 500 marginally up 2 points and the Nasdaq futures keeping head above waters up 9 points.

Here are some key events coming up:
• Earnings include Walmart Inc. and Home Depot Inc. on Tuesday. Target Corp. and Nvidia report on Wednesday. Results from Alibaba Group Holding Ltd. and Qantas Airways Ltd. are due Thursday.
• Minutes of the latest FOMC meeting are due Wednesday.
• The EIA’s crude oil inventory report comes out Wednesday.
• The Joint Ministerial Monitoring Committee — the panel that reviews the OPEC+ agreement — is due to meet on Wednesday.

ASIA
Asian markets sluggish as Sino-U.S. tensions weighed on optimism generated by Wall Street’s tech-driven rally. The Trump administration announced on Monday it would further tighten restrictions on China’s Huawei Technologies, aimed at cracking down on its access to commercially available chips. The MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.19%. Japan’s Nikkei slipped 0.25% while Hong Kong’s Hang Seng Index is unchanged at 0.06%, the Shanghai Composite rose 0.4%, while Australia’s ASX 200 rose 0.92%.