Not a member? Register | Lost your password?

Weekly Market Focus 06 August 2018

Markets

 

WEEKLY FOCUS - US Earnings Power Ahead                                               06 August 2018

 

 

 

81% of companies within the S&P500 have reported earnings recently and the numbers have again been stellar. Indeed, the blended earnings growth rate year on year is so far an impressive 23.5%, the second highest level since 2010. Furthermore, a cyclical high of 80% of the companies have outperformed analyst estimates according to Factset statistics. The S&P500 is close to its all-time highs with growth sectors performing well.  

 

All this is happening on the back of exacerbating trade tensions between the US and China and a depreciation of major currencies against the greenback which is adversely affecting commodity prices. The good news however is that Jean-Claude Junker, the President of the European Commission, appears to have reached an accord with President Trump during his visit to the US and there seems to be agreement to move towards a zero tariff across a range of goods. The Manufacturing PMIs data released last week is also encouraging as it indicates sustained expansion of economic activity across the US, EU and Asia.    

 

A rising dollar favours US companies which earn the majority of their revenue domestically compared to companies with greater international revenue. In fact it could translate into double earnings based on previous similar scenarios.

 

 

 

 

 

Value

Week

YTD

Equity Indices

 

 

 

S&P500

2,840

0.76%

6.24%

S. Africa

3,497

-0.25%

-7.75%

FTSE100

7,659

-0.55%

-0.37%

DAX

12,616

-1.90%

-2.34%

CAC40

5,479

-0.59%

3.13%

Swiss Mkt.

9,158

-0.17%

-2.24%

FTSE MIB

21,587

-1.68%

-1.22%

Shanghai Comp

2,740

-4.63%

-17.14%

BSE Sensex

37,556

0.59%

10.27%

Nikkei

22,525

-0.83%

-1.05%

Major currencies

USDZAR

13.33

1.11%

7.70%

EURUSD

1.16

-0.78%

-3.59%

GBPUSD

1.30

-0.73%

-3.75%

USDCHF

0.99

-0.02%

2.04%

EURCHF

1.15

-0.79%

-1.61%

USDJPY

111.27

0.20%

-1.26%

EURGBP

0.89

0.02%

0.17%

USDAUD

1.35

0.02%

5.44%

Dollar Index

94.96

0.53%

3.41%

Commodities 

Brent

73.21

-1.45%

9.48%

WTI Oil

68.49

-0.29%

13.36%

Copper

2.75

-1.54%

-16.07%

Aluminum

2,028.00

-1.06%

-10.88%

Platinum

832.50

0.02%

-10.92%

Sugar

10.85

-0.28%

-28.43%

Corn

369.75

2.14%

5.42%

Coffee

107.75

-2.44%

-14.62%

Gold

1,214.20

-0.65%

-7.26%

Cotton

88.17

-0.16%

12.36%

Sovereign Yields

 

 

 

US10Y

 2.95

(0.01)

0.55

UK10Y

1.33

0.05

0.14

Germany10Y

0.41

0.00

(0.01)

 

 

 

 

Contact: DBN +27 ( 0 ) 31 566 3365 | CPT +27 ( 0 ) 21 851 0920 | JHB +27 ( 0 ) 11 017 7230 | Email:enquiries@pegasuswm.com
Disclaimer: The research report has been prepared for information purposes and does not constitute an offer. While reasonable care has been taken to ensure that its contents are not untrue or misleading, no representation is made as to its accuracy or completeness and the company accepts no liability whatsoever for any direct or consequential loss, including without limitation any loss of profits, arising from reliance on this report.
 

 



Twitter
Facebook
Connect with us