Markets WRAP: Rand closes at R14.41

The rand closed at R14.41 on Friday. 

Here's how the day ended: 

USDZAR 14.4106

EURUSD 1.1335

EURZAR 16.3251

GBPUSD 1.3266

GBPZAR 19.1062

AUDZAR 10.2070

CADZAR 10.7883

CNYZAR 2.1453

ZARJPY 7.7323

CHFZAR 14.3703

R186 8.67%US

10 Year 2.59%

JSE 0.63%

FTSE 0.50%

S&P 500 0.18%

Brought to you by TreasuryONE

US equity-index futures rose alongside European stocks as concerns appeared to ebb about the slowdown in global growth. Emerging-market shares advanced, while the dollar and Treasuries held steady.

Technology and telecoms shares led the Stoxx Europe 600 higher, with the gauge also boosted by expiration of futures and options on both indexes and stocks. Contracts on the S&P 500, Dow and Nasdaq all climbed. Hours earlier, equities rose from Tokyo to Beijing, where the Chinese government said it would cut value-added taxes, reinforcing expectations for an eventual pick-up in the second-largest economy. The pound fluctuated at the end of a week made volatile by critical votes on Brexit in Parliament.

Prime Minister Theresa May won the endorsement of British politicians to seek a Brexit delay. Global stocks look set to end the week on a solid footing as investor attention turns to a packed calendar in the days ahead. Central banks in the US, the UK and Brazil will all announce policy decisions, while European Union leaders meet for discussions likely to be dominated by Britain’s request to extend its withdrawal timescale.

Boeing shares may remain active as the plane maker’s lawsuit risks soared around the 737 Max groundings.Elsewhere, gold’s advance pushed its 40-day volatility to the highest this year. West Texas crude steadied near $58 a barrel before a weekend meeting where the world’s top exporters will discuss whether to extend supply cuts.

And these are the main moves in markets:

Stocks

The Stoxx Europe 600 Index rose 0.6% as of 11:44 London time. Futures on the S&P 500 Index rose 0.5%. The UK’s FTSE 100 Index rose 0.7% and the largest advance in more than a week. The MSCI Asia Pacific Index rose 0.7%. The MSCI Emerging Market Index rose 0.6%.

Currencies

The Bloomberg Dollar Spot Index fell 0.1%. The euro rose 0.1% to $1.1319. The British pound rose 0.1% to $1.3261. New Zealand’s dollar rose 0.3% to $0.6841.

Bonds

The yield on 10-year Treasuries fell less than one basis point to 2.63%. Britain’s 10-year yield rose less than one basis point to 1.227%. Germany’s 10-year yield rose one basis point to 0.09%.

Commodities

Brent crude fell 0.4% to $66.96 a barrel. Iron ore declined 0.3% to $84.60 per metric ton. Gold climbed 0.6% to $1,303.94 an ounce. - Bloomberg

Oil set for weekly gain as OPEC+ meets to discuss extending cuts

Tsuyoshi Inajima and Grant Smith, Bloomberg 

Oil headed for a second weekly gain as the world’s top crude producers are scheduled to discuss extending their pledged output curbs to avert a global glut. Futures in New York traded near a four-month high, on course for a 4.4% weekly advance.

OPEC’s secretariat urged producers to continue efforts to prevent a surplus this year, ahead of a weekend gathering of the cartel and its allies. A surprise drop in US crude inventories reported on Wednesday added to signs of a tightening market.

Crude has rallied almost 30% this year as the Organization of Petroleum Exporting Countries and its partners - known as OPEC+ - cap output.

Involuntary production declines from nations including Venezuela and Iran have further squeezed supplies.

Still, lingering concerns over record output in the US and its prolonged trade tiff with China continue to weigh on prices.“OPEC’s strategy of reducing the supply to tighten the oil market and thus achieve higher prices is working so far,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “Only time will tell whether this strategy will also be successful in the longer term.”

It was another negative day for the rand yesterday as the negative EM sentiment still lingers in the market, says TreasuryONE's Andre Botha.

By 10:31, the rand was trading at R14.43 to the greenback.

"The negative sentiment was mostly due to events offshore with the Brexit debate and worse than expected Chinese data, sending investors back into the US dollar.

"Theresa May scored her first Brexit victory yesterday when she secured a vote to extend the Brexit decision of the 29th of March. This will give May the opportunity to propose a third Brexit strategy, which if accepted will give the UK a blueprint to leave the EU.

"We can expect some volatility for the time being as Brexit headlines will come in thick and fast. As for today, the data calendar is very light with the EU CPI number being the highlight of the day.

"We don't expect any fireworks from the number, judging by Mario Draghi's glum speech a couple of weeks back. We could see the US dollar on the front foot after the number. The rand will take its cue from movements overseas but be wary of the current load shedding schedule as this could affect the rand adversely should it continue for a couple of weeks.”

Asian stocks recover last week's loss

 Adam Haigh, Bloomberg

Asian stocks headed to recoup much of the losses last week that were the worst so far this year.

US futures also edged up as worries about the global slowdown appeared to ebb, though there was no change in narrative for bonds, where yields remain low.

Japan’s equities led gains at the start on Friday with little obvious trigger, and China’s domestic shares also jumped before paring gains in the afternoon.

Chinese Premier Li Keqiang announced tax cuts that reinforce expectations for an eventual pick-up China’s economy. The yen was little changed after the Bank of Japan left its policy settings on hold while downgrading its economic assessment to reflect a weakening in exports.

Ten-year Treasury yields are little changed on the week, languishing around 2.62%. Signs of geopolitical risks resurfacing did little to dent the bullish mood in stocks.

On Wall Street Thursday, the S&P 500 spent most of the session fluctuating between gains and losses in thin trading before edging lower at the close.

News that Presidents Donald Trump and Xi Jinping won’t be meeting to end the trade war at least until next month had weighed on sentiment.

The pound steadied at the end of a week made volatile by critical votes on Brexit in Parliament. Prime Minister Theresa May won the endorsement of British politicians to seek to delay Brexit day.

Crude, meanwhile, steadied above $58 a barrel ahead of a weekend meeting where the world’s top exporters will discuss whether to extend supply cuts.

Steinhoff said to seek about R6.5bn for properties in Europe

Steinhoff International Holdings [JSE:SNH] is seeking to sell properties in Europe worth about $450m (R6.5bn) to raise cash as it restructures its debt, according to people familiar with the matter.

The retailer, which almost collapsed amid an accounting scandal in late 2017, has hired Eastdil Secured LLC to advise on the sale of office buildings, warehouses and production sites in countries including the UK, Germany, Poland, and Hungary, said the people, who asked not to be identified because the matter is private.