MSCI’s broadest index of Asia-Pacific stocks outside Japan falls to two-week low

24/03/2021 World Markets are all set to open lower after a sell-off in the US overnight, Asian markets except Australia fell the most in two weeks as setbacks to the recovery from the pandemic weighed on equities and crude oil. Driving haven trades into Treasuries, the dollar and even some to Gold. The Hang Seng Index neared a correction as Hong Kong and Macau temporarily suspended Covid vaccines from BioNTech SE. S&P 500 futures are flat while the Nasdaq 100 contracts climbed 0.36%. Brent is stable just above $60 a barrel after tumbling yesterday, renewed lockdowns in Europe further clouded the prospects for a speedy recovery in consumption.
Many regions of the world are seeing rising Covid-19 cases as highly contagious variants continue to spread, the World Health Organization said. Germany and France are extending or enforcing new lockdown measures. Concerns about the recovery come on the one-year anniversary of the market bottom.
Locally, the All Share fell 0.90% despite NPN and PRX both ending positive, the ZAR is steady at R 14.91/$ and R 20.43/GBP. We can expect a lower open with Asia softer, 700HK – 1.59% and IG Markets Top 40 down 570 points. Statistics South Africa will announce February inflation data at 10am. Consumer prices are forecast to have risen 3.1% year-on-year, compared with a 3.2% increase in January. We will be looking ahead to 700HK numbers out later today, forecasts are for 52% growth in earnings 54 new games in the pipe-line, BUT the big question is will there be an increase in Government meddling.

Some notable Ex Divs today ARI, BVT, BTI, CSB, HYP, MTM, MTH.

• Steinhoff Insurers Agree to Pay $93 Million for Legal Claims
• Northam Platinum Forges New $2.2 Billion Empowerment Deal
• Investec Bank Seals Upsized $600m Term Loan From 29 Lenders
• S. Africa’s Sasol Drops as Demand Concerns Weigh on Crude Prices
• Shoprite Cut to Neutral at Citi

ECONOMIC DATA:

• 10am: Feb. CPI Core YoY, est. 2.6%, prior 3.3%
• 10am: Feb. CPI Core MoM, est. 0.7%, prior 0.1%
• 10am: Feb. MoM, est. 0.9%, prior 0.3%
• 10am: Feb. CPI YoY, est. 3.1%, prior 3.2%

European stocks closed mixed yesterday as concerns over a third wave of Covid infections in the region rattle investor sentiment. Market sentiment has faltered on doubts about the progress of the global economic reopening. Germany, France and Italy have widened virus-related curbs and cases are spiking in other countries. The head of the World Health Organization called recent increases in deaths and cases “truly worrying trends.” These concerns are adding to the ripple effects of quarter-end portfolio balancing across markets. The pan-European Stoxx 600 index finished lower by 0.1%, paring most of its earlier losses. Autos dropped 2.5% while telecoms climbed 1.3%. FTSE – 0.40% DAX + 0.03% CAC – 0.39%.
U.S. stocks sold off in the afternoon session as concerns about the cost of infrastructure spending and potential tax hikes to pay for President Joe Biden’s $1.9 trillion relief bill weighed on investors who also fear further downside in the market. The Dow lost more than 300 points, dragged down by a 3.4% drop in Caterpillar. The S&P 500 fell 0.76% with major losses from airlines and cruise lines and the Nasdaq dropped 1.12% as Facebook, Apple and Tesla all closed lower. The small-cap benchmark Russell 2000 fell 3.58%, for its worst day since June. Futures in the Dow and S&P are flat with the Nasdaq up 0.36%.
Asian shares hit a two-week low today, oil weakened further and the dollar neared four-month highs as coronavirus lockdowns in Europe and potential U.S. tax hikes hit risk appetite, leading to a flight to safety. The Hang Seng is among the biggest losers among the region’s major markets as it dropped 1.9% by the afternoon. In Japan, the Nikkei 225 slipped 1.83% in afternoon trade while the Topix index declined 1.86%. Shares in Australia bucked the overall trend regionally as the S&P/ASX 200 gained 0.49%. MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 1.1%.
Oil prices are flat this morning as some investors looked for bargains following yesterday’s plunge, but any gains have been capped as pandemic lockdowns in Europe and a build in U.S. crude stocks curbed risk appetite and raised oversupply fears. Both benchmarks touched their lowest levels since early February on Tuesday and have now fallen more than 14% from their recent highs earlier this month. Brent + 0.02% $ 60.80, WTI – 0.03% $ 57.73
Gold prices are better this morning, despite the dollar touching a more than two-week high after U.S. Federal Reserve Chair Jerome Powell reassured Congress that inflation would not spiral out of control. Golds trading at $ 1732/ounce + 0.28%, Palladium is lower 0.28% at $ 2,602.24 , Silver rose 0.2% to $25.13 and platinum is up 0.29% at $ 1171.