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Weekly Market Focus - 17 June 2019

Markets

WEEKLY FOCUS: Markets await the G20 meeting for direction                                                               17 June 2019
 

 

Major developed market equity indices started the week strongly but lost momentum and ended only slightly higher. The Russell 2000 index of small capitalization shares edged the S&P500 and Dow indices higher. The announced acquisition of data analytics firm Tableau by Salesforce.com for over USD 15 billion boosted the technology sector but the energy sector was affected by a larger than expected increase in US crude oil inventories followed by news of tanker attacks in the Gulf of Oman thereby increasing price volatility (chart above). The attacks lowered US treasury yields which were already dipping on account of soft inflation data, trade tensions and a general risk off sentiment.

 

The European Union reached an agreement to buy 80% of their beef imports from the US for 7 years after successfully persuading Australia and Argentina to relinquish part of their quota. It is hoped that the settlement of this decade long dispute will avert any further trade tariffs escalation between the economic blocs and relieve pressure off the German car industry. In the UK however, car production declined the most on record in April and further deterioration is predicted by the Society of Motor Manufacturers and Traders. Former Foreign Secretary B. Johnson is on course to become the next Prime Minister after finishing well ahead of his rivals in the first round of voting by the Conservative party.

 

The Shanghai Composite index finished nearly 2% higher on fresh stimulus hopes after closing at a four month low the week before. Industrial production in May rose by only 5%, its weakest pace since 2002 and fixed assets investments was also below expectations. Retail sales for May were however surprisingly strong at 8.6% y/y compared to expectations of 8.1%. The G20 meeting in a fortnight will shed light on whether trade tensions will subside and global monetary policy responses will be better coordinated.

 

 

 

 

 

 

 

 

 

 

 

 

Value

Week

YTD

Equity Indices

 

 

 

S&P500

2,887

0.47%

16.14%

S. Africa

3,506

0.05%

7.99%

Stoxx50

32

0.44%

14.36%

FTSE100

7,346

0.19%

9.09%

DAX

12,096

0.42%

14.56%

CAC40

5,368

0.07%

14.72%

Swiss Mkt.

9,848

1.01%

16.83%

FTSE MIB

20,612

1.24%

12.49%

Shanghai Comp

2,882

1.92%

15.56%

BSE Sensex

39,452

-0.41%

9.36%

Nikkei

21,117

1.11%

5.51%

Major currencies

 

 

 

USDZAR

14.84

-0.76%

2.84%

EURUSD

1.12

-1.09%

-2.00%

GBPUSD

1.26

-1.13%

-0.91%

USDCHF

1.00

1.13%

1.49%

EURCHF

1.12

0.04%

-0.59%

USDJPY

108.56

0.34%

-1.56%

EURGBP

 0.89

0.04%

-1.13%

USDAUD

1.46

1.83%

2.48%

Dollar Index

97.57

1.12%

1.67%

 Commodities 

 

 

 

Brent

62.01

-2.02%

18.79%

WTI Oil

52.51

-2.74%

15.84%

Copper

2.63

0.19%

-1.98%

Aluminum

1,758.75

-0.17%

3.64%

Platinum

803.60

-0.32%

1.69%

Sugar

12.75

2.00%

2.91%

Corn

453.00

8.96%

20.64%

Coffee

96.00

-4.90%

-4.90%

Gold

1,340.10

-0.08%

3.94%

Cotton

66.00

-0.14%

-8.68%

 Sovereign Yields

 

 

 

US10Y

 2.08

 -  

(0.63)

UK10Y

0.85

0.03

(0.42)

Germany10Y

(0.26)

0.00

(0.49)

 

Contact us: Durban +27 (0) 31 566 3365 | CPT +27 ( 0 ) 21 851 0920 | JHB +27 ( 0 ) 11 017 7230 | Email: enquiries@pegasus-wm.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

 

 



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