Global equity markets retreated again on Friday as weaker economic data out of China, indicated that the Chinese economy is now feeling the full pinch of US tariffs. On Thursday evening more “threats” from the Trump administration were directed at Beijing, with threats of more tariffs being levied on Chinese goods if President Xi Jinping does not meet up with President Trump at the G20 summit at the end of the month.
Asian shares were mixed on the day as losses were recorded by the Hang Seng and the Shanghai composite Index, which shed 0.65% and 0.83% respectively. The Nikkei was firmer on the day posting gains of 0.4%, whilst the ASX 200 advanced 0.18%. The Hong Kong interbank rate hit its highest level since 2008 as the overnight Hibor advanced to 2.33%. The high demand for cash is being attributed to seasonal demands for cash, however there seems to be a political undertone to this hike in demand. There is concern around the currency peg against the dollar and whether the peg will remain if interest rates continued to soar.
The JSE All-Share index closed 0.07% firmer whilst the JSE Top-40 index shed 0.05%. The Resource index rallied on the day supported by firmer commodity prices to chalk up gains of 1.42%, the Industrials retreated 0.47% whilst the Financials eased 0.84%.
The miners recorded another positive close on the market on Friday with the Gold counters posting the most notable gains. AngloGold Ashanti Ltd [JSE: ANG] and Harmony Gold Mining Ltd [JSE:HAR], advanced 3.68% and 2.21% respectively. The largest gains were posted by Afrimat Ltd, Tradehold Ltd and African Oxygen Ltd which advanced 5.8%, 4.63% and 4.10%.
Omnia Holdings [JSE:OMN] continued to retreat on Thursday shedding 6.93% as losses were recorded across the retail sector. Losses were recorded by Massmart Holdings Ltd [JSE:MSM], Truworths International Ltd [JSE:TRU], and Shoprite Ltd [JSE:SHP], retreated 4.41%, 3.96% and 3.04% respectively.
The JSE All-Share index closed 0.86% firmer whilst the JSE Top-40 index shed 0.81%. The Resource index retreated 1.44%, whilst the Industrials and the Financials retreated 0.72% and 0.39% respectively.
At 17.00 CAT, Palladium was 0.97% firmer to trade at $1452/Oz, Platinum remained weak on the day shedding 0.48% to trade at $805.55/Oz, whilst Gold was 0.56% firmer at $1351.65/Oz.
Brent crude was firmer on the day after two tankers were attacked on Thursday. US secretary of state Mike Pompeyo in a press conference indicated that the destruction to the two tankers was beyond any other power apart from Iran. Brent crude was trading at $61.20 per barrel at 17:00 CAT. The market is on edge as players contemplate what retaliatory action the US would take.
The Rand was firmer on the day to trade at R14.75 against the USD, R16.60 to the Euro and R18.64 to the Pound Sterling. All eyes are on the FED next week as the market looks at what action they will take with regards to interest rates in the US economy.
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