It has been a volatile week in financial markets with our local bourse once again testing all-time high territory, before finding itself under pressure as US markets incite global market direction.
The trading week started lower after Asian Markets snapped an 8 day winning streak led by a decline in IT and Technology stocks. South African Gold and Foreign Exchange Reserves (net) were at $45.04billion down from $45.34billion. The Business Confidence Index showed improved business sentiment with an index reading of 92.7 in February, previously 91.8. Ironically this was on the same day the International Monetary Fund (IMF) significantly lowered its South African economic growth forecast for 2014 and 2015 from 2.8% and 3.3% to 2.3% and 2.7% respectively.
Manufacturing and mining production figures released by StatsSA would have added support to the IMF’s view as both figures fell short of expectation, with the latter showing a large decline annually. Manufacturing production grew 1.4% in February year on year, while falling 1.95% on a seasonally adjusted monthly basis. The ongoing strike in the platinum sector is likely to have affected mining production, which fell 4.8% in February (annualized).
Still on the African continent, Nigeria surpassed South Africa as the largest economy after a rebasing valuing it at $491billion.
Chinese exports fell 6.6% from the previous year and imports fell 11.3%, leaving a trade surplus of $7.71billion. Tencent lead markets in Asia lower at the end of the week dropping by over 6.75% on Friday.
After an initial sell off in Tech Stocks in the USA on Monday and Tuesday, the Dow saw some interim relief buying after the Federal Reserve minutes damped bets that they were considering accelerating raising interest rates.
In the UK the monthly Manufacturing Production increased to 1% from a previous 0.3% and interest rates were left unchanged at 0.50%, as the UK and Europe saw similar trading volatility to the USA and China.
Naspers has swung up and down again following Tencent in the Asian market giving back gains of over 6%.
Massmart CEO Grant Pattison steps down effective 1 June 2014. Mark Lamberti also tendered his resignation effective immediately, stepping down as Chairman and Director. He was appointed Managing Director of Makro in 1988 and founded Massmart in 1990.
BNP Paribas has agreed to buy RCS Investment Holdings from Standard Bank and Foschini Group for R2.65billion. Foschini stands to make about R1.4billion from its 55% holding and will use the capital to buy back its own shares, reducing its debt in the process. BNP dropped -1.4% in Paris, standard bank climbed 1.4% and Foschini rose 3.1%.
Woolworths shed as much as 7.9% on Wednesday after announcing it would buy David Jones in Australia for $2bn, paying a hefty 25% premium for the retailer.
Follow one of the links below for a quick look at our web-based platform and the range of markets on offer.
If you're interested in finding out more about the range of markets available and the functionality of our trading platform, you can open a demo account.
IG provides an execution-only service. The material on this website does not contain (and should not be construed as containing) investment advice or an investment recommendation, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. This communication must not be reproduced or further distributed. The price levels provided are derived from ProRealtime Charts (IT-Finance)
Source: I-Net Bridge
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.