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18 Jun 2019

Global stocks, bonds climb as ECB fuels stimulus hopes

Todd White, Bloomberg 

Global stocks climbed and bonds rallied on Tuesday as comments from ECB officials added fuel to investors’ hopes for easier monetary policies from the world’s biggest central banks.

Futures on the S&P 500, Nasdaq 100 and Dow Jones indexes advanced along with the Stoxx Europe 600, while Japan’s Topix bucked the trend as most Asian gauges also rose.

The euro turned weaker after European Central Bank President Mario Draghi said additional stimulus may be needed if the economic outlook doesn’t improve. That move pared slightly when President Donald Trump weighed in, accusing the ECB in a tweet of weakening its currency to make the region’s exports more competitive.

Three of the central bank’s officials told Bloomberg an interest-rate cut would probably be the first step in any stimulus.

At the same time, data showed investor confidence in Germany’s economic outlook worsened dramatically in June, adding to expectations of central bank support.

Treasuries and European bonds rallied, led by Italian and Greek notes.

Oil dropped, with OPEC nations still unable to agree on a date for their next meeting, adding to uncertainty over whether production cuts would be extended.

With central banks around the world moving toward looser policy as trade tensions weigh on the global economy, investors are looking for signals from the Fed tomorrow on the likelihood of interest-rates cuts.

That’s the headline act in a week that includes the ECB gathering in Portugal, as well as Bank of England and Bank of Japan policy announcements. Central banks in Australia, Russia, India and Chile have recently loosened policy.

The Reserve Bank of Australia said Tuesday that further easing is more likely than not.

18 Jun 2019

Old Mutual to fire CEO for breaching dividend payment rules

Old Mutual announced on Tuesday that it plans to fire Chief Executive Officer Peter Moyo after suspending him due to a conflict of interest.

The board gave Moyo a "notice of termination of employment" and will "shortly" start the process to find his replacement, the insurer said in a statement. Chief Operations Officer Iain Williamson will continue as acting CEO. Moyo declined to comment when contacted by phone.

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18 Jun 2019

Shares in property group NEPI Rockcastle on Tuesday became available for trade on the A2X exchange. 

The A2X, which has been active since October 2017, is a licensed stock exchange which provides secondary listings for SA companies.

The group will retain its listings on the JSE and Euronext Amsterdam. Its issued share capital will be unaffected by the listing.

18 Jun 2019

Asian stocks trade mixed; Yen rises

Cormac Mullen, Bloomberg

Asian stocks put in a mixed performance Tuesday ahead of the highly anticipated Federal Reserve meeting, while Treasury yields dipped and the yen climbed. Stocks slid in Japan, rose in Australia, Hong Kong and South Korea, and fluctuated in Shanghai. European futures pointed lower.

Investor focus remained firmly on the Fed’s statement and press conference Wednesday to see whether Chairman Jerome Powell and his colleagues will validate widespread expectations for interest-rate cuts. There was little cue from Wall Street’s Monday trading, when the S&P 500 Index closed flat, though tech stocks did send the Nasdaq 100 higher.

The Aussie ticked lower after the Reserve Bank of Australia said that further easing is more likely than not in the period ahead. The euro was higher ahead of the European Central Bank’s annual gathering in Sintra, Portugal.

Traders are refraining from putting on big bets ahead of the key central bank decision Wednesday, where they will look for signals on the likelihood of interest-rates cuts ahead. There’s a widespread desire for proof the Fed is ready to act, but too much change could raise alarm.

“We know that the Fed doesn’t like to surprise people and the idea at this point of them digging in their heels and saying ‘absolutely no cuts,’ I think is very unlikely,” Josh Kutin, head of asset allocation for Columbia Threadneedle, said in an interview at Bloomberg’s New York headquarters.

“Will it be the full number that’s priced in right now? I think that’s unlikely as well. I think somewhere between is pretty fair.”

Elsewhere, oil retreated with OPEC nations still unable to agree on a date for their next meeting - adding to uncertainty over whether production cuts would be extended.

18 Jun 2019

Steinhoff set to release its delayed 2018 earnings report

Retailer Steinhoff is set to release its long-delayed audited group financial results for 2018 on Tuesday. 

Steinhoff’s share price has fallen by over 90% since December 2017 when its former CEO Markus Jooste abruptly resigned in an accounting scandal. 

Once one of South Africa’s largest listed companies by total market value, it has since fallen out of the top 100 largest JSE firms by market capitalisation.

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