Global Stock Markets Rebound As Fed Officials Calm Inflation Fears

14/05/2021 Market jitters, over accelerating U.S. inflation, were calmed by Federal Reserve officials on Thursday reiterating that price pressures from the reopening of the economy would prove transitory. Asian markets rebounded on Friday, with Japan leading the gains, bringing some relief after a bruising week in which worries about price pressures sapped equities. S&P 500 and Nasdaq 100 contracts climbed after the indexes gained overnight. The US 10-year treasury yield eased to 1.66%.
Oil headed for a the biggest weekly drop since early April as countries in Asia continue to fight persistent Covid-19 outbreaks. U.S WTI trading below $64 at 63.65, down 0.30%; while Brent retreated 0.36% to $66.32. Bitcoin slid to a 2-1/2-month low on Thursday after a regulatory probe into crypto exchange Binance added to pressure from Tesla.

JSE extended losses on Thursday taking cue from its global counterparts. The local bourse lost 1.86% to 66,168.65 points, whilethe Top-40 slipped 2.14% at the close. Resources gave up 3.05%, precious metals lost 1.81%, banks down 1.13% and financials retreating 1.07%. Kumba Iron Ore fell 4.33% to R686.33, its biggest losses in almost eight weeks. Naspers fell for the fourth consecutive day, down 3.31% to R3,020.55, while Prosus lost 2.26% to R1,433.42. The rand steady yat R14.14/$. Tencent 0.90% firm as markets in Asia rebound.

EQUITY PREVIEW:
• Santam Appoints Former Telkom CEO Pinky Moholi to Its Board
• Standard Bank CEO Says South Africa Economic Reforms Too Slow
• Steinhoff Will Oppose Tekkie Town’s Liquidation Application
• Tiger Brands Expects 1H EPS Between 295%-305% Higher
• Omnia Holdings Raised to Equal-Weight at ABSA Securities
• Absa Group Sees 1H HEPS, EPS More Than 10 Times Year Earlier
• Diamond Mining Market Signals Turning Bullish, Liberum Says
• Iron Ore Miners to Ship 5% More in 2Q Than Prior Q: Bernstein
• Liberty 3-Month Long-Term Indexed New Business Sales up 12.4%
• South32 Reports Fatality at South Africa Energy Coal
MEDIA SUMMARIES:
• Business Day.za: CNA in financial trouble and battle with CEO Benjamin Trisk
• Financial Mail: Pick n Pay’s trash is Clicks’ treasure
• Financial Mail: EXCLUSIVE: How 71% of SA wants the vaccine, but only 1% has had it
• Moneyweb: Naspers and Prosus barely scratching at a big problem
• Fin24: SA-born biotech billionaire commits R3 billion to produce vaccines locally
• Moneyweb: SA economy is seeing massive bounceback – BankservAfrica
• Business Day.za: SA’s Covid death toll is one of the worst in the world
GOVERNMENT:
• 10am: Treasury Director-General Dondo Mogajane speaks at the launch of Spacialized Economic Data Reports on eight metropolitan municipalities
• Police Minister Bheki Cele will present crime statistics for the three months through March, covering a period when South Africa was under lockdown restrictions due to a resurgence of coronavirus infections.

EU/UK/US
The pan-European Stoxx 600 index ended down 0.14%, with London’s bluechip FTSE100 slidding 0.60%, while the German Dax swam against the tide to gain 0.33% at the close to 15,199.68. European stock markets were weighed down by a fall in heavyweight miners after commodity prices tumbled. Basic resources fell 3.0%, while oil and gas slipped 1.4%. The sectors were among recent market leaders on the back of a surge in commodity prices. British luxury brand Burberry tumbled 4.2% on reporting a 10% drop in annual sales, weighed down by the COVID-19 pandemic.

U.S technology stocks rebounded as Apple and Microsoft rose more than 1.5%, sending the tech-heavy Nasdaq 100 index to cluse up 0.77%. Wall Street stocks were firmly in the green on Thursday as tech stocks were back in favour after the blue-chip index turned in its worst performance since January in the previous session. The Dow gained 1.30%, while the S&P 500 cruised to close firm 1.22%. The Fed, meanwhile, insists the economy needs support before returning to maximum employment. All three main futures indices are in the green on Friday morning.

ASIA
China stocks climbed on as financial and healthcare firms gained, leading a rally in Asian markets. The Shanghai Composite Index advanced 1.7%, alongisde the Hang Seng gaining 0.95%. Japan’s Nikkei added 2.23%, as healtchare advances 2.70%, and the Aussie’s ASX200 gaining 0.66%. Investors are also focused on the development of Sino-U.S. relations. The United States needs new trade law tools to head off anti-competitive threats from China against key American high-technology industries, rather than reacting once harm is done, U.S. Trade Representative Katherine Tai said on Thursday.