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Monday Morning Wake up Call 22 October 2018

Musa Makoni

What to look forward to this week

A possible equity rout was averted on Friday following the release of weaker than expected Chinese GDP numbers, as Chinese regulators quickly stepped in to show support for the economy and the equity markets. As a result, equity markets across most emerging markets were relatively stable as investor confidence was buoyed. Locally, this week will be significant as we are expecting the Mid-Term Budget Policy Statement from the newly appointed finance minister, Tito Mboweni. It will be key to see how this ties in with the recently announced Economic Stimulus and Recovery Plan. Ratings agencies will be watching the speech closely and of significant importance is Moody’s which still has South Africa’s sovereign rating rated as investment grade.


  • No significant economic data is expected on Monday therefore it should be a relatively quiet day on that front. We are not any significant local or international earnings releases.


  • DAX index traders need to look out for German PPI data on Tuesday morning at 8am. The Eurozone is expected to release Consumer Confidence data at 4pm, and we also expect the Richmond Manufacturing Index numbers out of the USA at that same time. Locally, Anglo American Platinum is expected to release its Q3 production update.


  • Wednesday will be a busy day in terms of economic data. We are expecting Manufacturing and Services PMI data for Japan at 2.30am that morning, and during the day we are expecting the same data from countries in the Eurozone as well as the USA. The USA is also expected to release New Home Sales data at 4pm, and at 4.3opm we will be anticipating the weekly Crude Oil Inventories numbers. However, more focus will be on the local markets for the Mid-Term Budget Policy Statement, and we also expect Statistics SA to release CPI numbers for the month of September.


  • On Thursday the Eurozone will be in focus as the ECB is expected to announce its interest rate decision at 1.45pm, followed by a press conference at 2.30pm. At 2.30pm we are also expecting the USA to release Durable Goods Orders, Goods Trade Balance and the weekly Initial Jobless Claims numbers. At 4pm we are anticipating Pending Home Sales numbers from the same country. Locally, Statistics SA is expected to release PPI data for the month of September. 


  • Friday will be another subdued day as the only significant data expected is GDP numbers out of the USA at 2.30pm. There might be some volatility for the Euro at 4pm as the ECB President, Mario Draghi is expected to deliver a speech in Belgium.


Remember to keep a close eye on Tencent Holdings, as its recovery could result in a rebound in Naspers which is likely to lift the All-Share index. The rand was relatively stable in last week’s trading session and US dollar strength or weakness continues to be the main driver of price action for the time being.

We will be keeping tabs on the events in the markets. Check out our blog for market updates, insights from our GT247.com team, and our independent analysts. Not sure about a trade? Call the GT247.com Trading Desk on 087 940 6102, and bounce your idea off one of our dedicated traders.

Until next week, we wish you profitable trading!

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