18 February 2020 06:46:10 PM

Earnings and Trade See Equities Fade

- 2018-05-04 02:54:54 PM

On Thursday, global equities got off to a jittery start as trade talks between the United States and China as well as disappointing earnings reports saw the bears come out of hibernation early in the session. Of the companies adding to the nervousness: AIG down 5.31% after it's first quarter results missed expectations; Tesla down 5.55% after CEO Elon Musk shut out Wall Street analysts and leaving the market frustrated due to the lack of information provided on the conference call; NXP Semiconductors NV down 10% following the release of unimpressive first-quarter results. Overall, the Dow Jones Industrial Average managed to close up by 0.02%, while the S&P500 and Nasdaq Composite were down 0.23% and 0.18% respectively. 

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Locally, the All Share Index finishsed lower by 2.01% as shares of technology giant Naspers faltered amid news that one of the Tencent subsidiaries was being probed for a data breach. Adding to the pain was the Financial 15 Index that was lower by 2.85%, the Industrial 25 down 2.53% while the Resource 10 shed 0.77%. 

USDZAR - Technical Analysis

The pair has retreated on the back of lower US yields, gaining 15 cents from yesterday's high of R12.73. The Relative Strength Index is starting to roll over from overbought territory, signaling a slowdown in US Dollar buying in the ultra short term. Over the medium term the price remains above the 20 and 50-day moving averages, signaling a shift in trend to the upside. Support comes in at R12.48 followed by R12.32 while resistance is at R12.72.     

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Should the Rand strengthen iin the short term, investors could consider taking funds offshore as the US Dollar finds continuing support in global markets. Why not have a chat with the trading desk to see which options are available?

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In currencies, the South African Rand trades as follows:

USDZAR +0.05% to 12.59
GBPZAR +0.04% to 17.09
EURZAR +0.05% to 15.09
Gold trades at $1313, Platinum at $903 while Brent Crude Oil is at $73.57.  

International Markets

This morning, Asian equities are as follows:

Nikkei 225 (-0.16%)
Hang Seng (-0.29%)
Shanghai Composite (-0.12%)

Latam Markets closed as follows:  

Merval 25 (-0.37%)
Bovespa (-1.49%)
INMEX (-1.61%)

Need trading ideas and research? Visit our online portal at online.unum.co.za 

Company News

MTN Group - Quarterly update for the period ended 31 March 2018


- Group subscribers increased by 1,9% quarter-on-quarter (QoQ), with net additions of 4,1 million 
- Active MTN Mobile Money customers increased by 3,9% QoQ to 22,7 million 
- Voice traffic (billable minutes) increased by 24,2% and total data traffic increased by 56,7% 
- Group service revenue increased by 9,1%  
- Group data revenue increased by 26,9% 
- MTN South Africa increased service revenue by 2,5% while the EBITDA margin increased by 150bp year-on-year (YoY) to 35,0% 
- MTN Nigeria increased service revenue by 14,4% while the EBITDA margin increased 340bp to 41,8% 
- MTN Irancell increased service revenue by 15,2%

Invicta Holdings Limited - Voluntary Announcement Regarding The Acquisition Of The Business Assets Of The Forge Industrial Group

Invicta is pleased to announce that its subsidiary, Invicta South Africa Holdings (Pty) Ltd, has entered into an agreement to acquire the business assets of the Forge Industrial Group (the “Acquisition”). The Acquisition will be complete after the fulfilment of certain conditions precedent, including Competition Commission approval. 

The Forge Industrial Group comprises of importers and distributors of engineering related products (Toolquip and Allied), machining tools (F and H Machine Tools) and industrial conveyer belting and related components (Belt Brokers). It operates through 11 branches countrywide including three distribution centers in Gauteng. 

Invicta’s position as one of the leading firms in the industrial and engineering industry is further entrenched by this acquisition of the Forge Industrial Group, which will form part of Invicta’s Engineering Supply Group (ESG). 

In terms of the JSE Limited's Listings Requirements’ categorisation rules for transactions, the Acquisition falls below the threshold for announcement on SENS. Nevertheless, the board of Invicta deems it appropriate to inform its various stakeholders of the Acquisition.

Aus miners:
BHP Bil (-0.09%)
Rio Tinto (+0.29%)
S32 (+2.84%)
Facebook (-1.16%)
Amazon (+0.15%)
Netflix (+0.53%)
Google (-0.02%)

FTSE Miners:

Anglo American plc (-1.45%)
BHP Billiton plc (-0.19%)
Glencore plc (+0.39%)
Alibaba closed higher by 0.55%, while Tencent is higher by 0.78% in afternoon trade in Hong Kong.

At Unum Capital, we remained committed to finding high probability money-making trade ideas where the risk-to-reward ratio is the most attractive. Whether on the JSE or offshore; equity, indices, commodities, currencies or even cryptocurrencies, clients are able to add to portfolio performance in a manner that grows their account over time. If you would like to get started or are interested in growing your trading account, drop the Trading Desk an email at tradingdesk@unum.co.za or call 011 384 2920 to chat to a trader.