Daily Solutions – 11 October 2017

By Alexander Forbes Investments on Oct 11, 2017 in Market and Economic Commentary The news

JOHANNESBURG – The JSE closed marginally higher on Tuesday, as the dollar paused for breath from its recent rally, lifting retailers and banks. Rand hedges, which had helped lift the local bourse to record highs in recent sessions, fell, while volumes on the JSE were slightly below average. Capitec was the star performer in its sector, gaining 1.94% to R912.50. Retailers were bolstered by a market-pleasing trading statement from Dis-Chem, while the rand, along with other emerging-market currencies, gained from the break in the dollar’s rally. The all share added 0.17% to 57,629.9 points and the top 40 0.08%. General retailers gained 1.96%, banks 1.29%, financials 0.79%, food and drug resources 1.2%, and the property index 1.26%. Resources dropped 0.87%, gold miners 0.72%, and the platinum index 0.31%. Local data was upbeat, with manufacturing production registering growth of 1.5% year on year in August, after having contracted in the preceding four months. This was despite a consensus forecast for a mild contraction. Nevertheless, over the past year, the performance of the South African manufacturing sector had diverged from global manufacturing production, which has strengthened, according to Investec economist Kamilla Kaplan. The comparative under-performance of the local manufacturing sector can be linked to persistently weak domestic demand conditions.

US MARKETS – U.S. stocks rose to record highs on Tuesday after WalMart announced a large buyback and Honeywell said it was splitting into two. Pfizer also contemplated a spin-off as Corporate America looked for ways to keep investors happy and keep this eight-year bull market going. The Dow Jones industrial average hit intraday and closing record highs, rising 69.61 points to 22,830.68. Wal-Mart contributed the most to the gains. The Nasdaq composite reached an intraday high, and finished 0.1 percent higher at 6,587.25. The S&P 500 gained 0.2 percent to finish at 2,550.64, with consumer staples among the best-performing sectors. The index notched a record intraday high.

EUROPEAN MARKETS – Europe finished under slight pressure Tuesday, as ongoing political uncertainty in Spain outweighed positive sentiment seen in oil and individual stock news. The pan-European Stoxx 600 closed on a relatively flat note, down 0.01 percent; while sectors showed a mixed picture by the market close. Looking to bourses, the U.K.’s FTSE 100 outperformed most indexes, closing up 0.40 percent. Meanwhile, the French CAC 40 fell 0.04 percent while Germany’s DAX ticked lower, ending 0.21 percent down. Spain’s IBEX pared some of its sharp losses by the close, ending 0.92 percent down, as investors were in wait-and-see mode, looking for news of an address from Catalan independence leader Carles Puigdemont.

ASIAN MARKETS – Most Asian shares closed higher on Tuesday as markets shrugged off the softer close on Wall Street. Japan’s Nikkei 225 rose 0.64 percent, or 132.8 points, to close at 20,823.51 after markets reopened for trade following a long weekend. The index had touched a fresh two-year high earlier in the session. Trading houses and financial names declined, while automakers and tech stocks were mixed: Toyota closed up 1.61 percent, Mazda Motor slid 1.33 percent and Sony finished down 0.65 percent. Across the Korean Strait, South Korea’s Kospi surged 1.64 percent to finish the session at 2,433.81 as blue-chip tech plays notched robust gains on optimism about profit expectations. Samsung Electronics rallied 2.96 percent and SK Hynix finished up 7 percent.


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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