13 October 2017 – October 2017

By Alexander Forbes Investments on Oct 13, 2017 in Market and Economic Commentary The news

JOHANNESBURG – The JSE edged lower on Thursday, taking a breather after reaching a series of peaks over the past few days, during which the all share added about 4%. On Thursday, investors appeared ready to begin lightening their exposure to a few counters which had enjoyed a decent run in the past eight trading days. The loss of momentum was also partly attributable to a continuing recovery in the rand holding back big dual-listed shares, which invariably set the direction for the market. Soon after midday, the rand bought a single dollar for R13.50, from R13.86 at the start of the week, with the stronger currency proving favourable to certain segments of the market, including banks and retailers. The all share was down 0.20% to 57,654.80 points at lunchtime, while the top 40 lost 0.31%. Aspen Pharmacare was the best performer among the blue-chip companies, while the recently sold-down shares in the mid-and small-cap categories continued to recover. Global markets chugged along at a steady pace on the day, after US Federal Reserve officials expressed concern about the medium-term outlook on inflation, which has, for some time now, been below its 2% target. Analysts said an interest-rate increase in the US could still be expected in December, but the minutes indicated serious concerns about the outlook for inflation, and thus further increases in 2018.

US MARKETS – U.S. stocks closed lower on Thursday as Wall Street digested earnings from some of the top financial companies. The Dow Jones industrial average finished 31.88 points lower at 22,841.01, after hitting an intraday record. The Nasdaq composite also notched an intraday record, before closing 0.2 percent lower at 6,591.51. The S&P 500 declined 0.2 percent to 2,550.93 after reaching an all-time high earlier in the session. “We still have a long way to go in the earnings season to know where things are,” said Ken Moraif, senior advisor at Money Matters. But “there’s a lot of optimism in the market that earnings will be good.” JPMorgan Chase reported third-quarter earnings and revenue that beat analyst expectations. The banking giant, however, also reported a 27 percent year-over-year decline in fixed income trading revenue. The shares fell nearly 1 percent, but are still up 11 percent this year.

EUROPEAN MARKETS – European shares ended mostly higher Thursday, as investors digested the latest news surrounding Brexit, while keeping a close eye on comments coming from central bankers in Washington. The pan-European Stoxx 600 eked out minor gains at the end of trade, closing provisionally 0.03 percent. Sectors finished the day mostly in the black. In bourses news, the U.K.’s FTSE 100 popped 0.30 percent, boosted by a rise in mining stocks and a drop in sterling; while Germany’s DAX finished off its highs, up 0.09 percent. In trade, Germany’s benchmark index hit a fresh record high, topping 13,000 points — the first time in its 30-year history. France’s CAC 40 however slipped 0.03 percent following data which showed that consumer prices were up 1.1 percent on the year in September, but 0.2 percent lower from the previous month.

ASIAN MARKETS – Most Asian shares gained on Thursday after Wall Street closed at record levels following the latest minutes from the Federal Reserve. Meanwhile, the dollar remained on the back foot. Japan’s Nikkei 225 rose 0.35 percent, or 73.45 points, to close at 20,954.72 after touching a fresh 21-year peak earlier in the session. Softbank Group contributed to broader gains on the index, with the company’s stock surging 3.59 percent. Across the Korean Strait, the Kospi rose 0.68 percent to end at 2,474.76 despite moderate declines in blue-chip exporters: SK Hynix closed down 0.67 percent and LG Display fell 5.12 percent. Hong Kong’s Hang Seng Index advanced 0.37 percent by 3:15 p.m. HK/SIN.


Alexander Forbes Investments

Alexander Forbes Investments

Alexander Forbes Investments was established in 1997. We are a forward-thinking and trusted global investment provider, with roots in Africa. In pursuit of certainty we set out to understand our retail and institutional clients’ circumstances and risk tolerance to set clear goals. Our adaptive investment approach, called Living*Investing allows us to maximise opportunity and minimise risk at every stage of the investment cycle.

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