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20 Nov 2018
20 Nov 2018
Oil dropped again on persistent fears that a surplus will re-emerge next year despite OPEC’s plans to cut production. Futures for January delivery fell 1.5% in New York. US inventories are on track for a ninth weekly increase, the longest run in more than a year, according to a Bloomberg survey before government data due Wednesday.
While the Organisation of Petroleum Exporting Countries has signaled it plans to curb output when it meets next month, it’s unclear whether ally Russia will assist. “The name of the game in the oil market is volatility,” International Energy Agency Executive Director Fatih Birol said at a conference in Oslo. “And with the increasing pressure of geopolitics on oil markets that we are seeing, we believe that we are entering an unprecedented period of uncertainty.”
Crude markers in New York and London have both fallen more than 20% from their October highs on concerns over a supply glut after the US granted waivers to some buyers of Iranian oil despite sanctions. While trade tensions between China and America weaken the outlook for demand, Saudi Arabia’s oil policies aim to preserve market stability, the nation’s king said during his first major public speech since the murder of prominent journalist Jamal Khashoggi.
West Texas Intermediate for January delivery traded at $56.37 a barrel on the New York Mercantile Exchange, down 83 cents, at 08:18 local time. The December contract settled up 0.5% on Monday and has expired. Total volume traded Tuesday was 40% above the 100-day average.
Brent for January settlement dropped $1.12 to $65.67 a barrel on the London-based ICE Futures Europe exchange, after closing little changed on Monday. The global benchmark crude traded at a $9.27 premium to WTI. Russian Energy Minister Alexander Novak said Monday that the country and its allies in OPEC need to watch the oil market in the coming weeks before making any decisions to reduce output. The wait-and-see approach contrasts with Saudi Arabia’s call for cuts, just weeks before they meet at a key OPEC+ summit in Vienna. While Russia pointed out the need for a “balanced decision,” the kingdom has sought curbs of about 1 million barrels a day. - Bloomberg
20 Nov 2018
OVERVIEW: Stocks fell from London to Shanghai and US equity futures signaled the global rout led by technology shares would deepen Tuesday, adding pessimism to markets already anxious over trade. Treasuries advanced and the dollar edged higher.
Contracts on all major US equity indexes pointed to declines at the open, with megacap tech shares leading the drop. The Stoxx Europe 600 Index fell a fifth day as its technology sector headed toward a bear market. Equities slid across Asia after US software developers and chip makers dragged the S&P down Monday.
Here are some of the main pre-market moves in the US:Apple slumped 2% and is headed for a bear market, while every member of the FANG cohort was down at least 1.5%. Semiconductors sank, with Nvidia, Micron and AMD down at least 4%. Target plunged almost 10% after margins narrowed and sales growth slowed. Lowe’s slid more than 5% on poor results.
Treasuries rose, driving the 10-year yield down to its lowest level since late September, ahead of the US Thanksgiving holiday Thursday. A credit-default swap index of mostly high-yield issuers in Europe reached the highest in almost two years, signaling renewed nerves about the asset class. After the downdraft last month, equity markets are struggling for footing in November as some of the technology companies that helped drive the S&P 500 to a record high earlier this year tumbled amid a slowdown in consumer sales and fears over regulation. At the same time, a more gloomy macro outlook is emerging, with Goldman Sachs recommending investors hold more cash.
Ray Dalio, founder of Bridgewater Associates, the world’s largest hedge fund firm, said that investors should expect low returns for a long time after enjoying years of low interest rates from central-bank stimulus.“The easy days of long, global bull markets where you can invest in a tracker for five basis points - I say this as an active fund manager - and watch the thing go up, I think those days are gone,” Gerry Grimstone, chairman of Barclays Bank and Standard Life Aberdeen, said in an interview on Bloomberg Television.
“It’s going to be a move back to value investing, and back to the Warren Buffett-style of investment.” Elsewhere, the pound stabilised as Theresa May appealed to business leaders to help deliver her Brexit deal, and evidence mounted that a plot to oust her as UK Prime Minister is faltering. Bitcoin extended its drop from Monday when it fell below $5,000 for the first time since October 2017. WTI crude oil futures hovered around $57 a barrel. - Bloomberg
20 Nov 2018
20 Nov 2018
Rand even, Naspers takes a hit
The rand was trading at R14.04/$ at 13:21; after opening the day's trade at R14.02/$.
The JSE All-Share index was down -1.13% at 51 828, while heavyweight Naspers [JSE:NPN] was tradingat R2 716.87 per share, down -3.83% on the day, as global tech stocks suffered.
20 Nov 2018
Andre Botha, Senior Currency Dealer at TreasuryONE said in a morning note to clients, “Little in the way of new insights to report as yesterday was a fairly quiet day in the market, with the only bit of real excitement being when the rand tested 13.9200 in morning trade.
"We have seen the US dollar slipping against most currencies as the Fed commented on the global economy and the impact that will have on the US and their rate hiking schedule. The pound is currently on a see-saw with new details emerging of Theresa May's plan to exit the EU. Her plans have not got a lot of traction with the British Parliament and there are talks of her struggling to hold onto her position as we head into next months Parliamentary debate on Brexit.
"The safe money is on the pound to continue to see volatility in the short to medium term. With not a lot in terms of data and events on today's calendar, we can expect another range bound day for the rand. The rand has struggled to sustain a break below R14.00 and the feeling is that new impetus is needed for a break out of its current trading range.”
20 Nov 2018
OVERVIEW: Stocks fell globally, with European and Asian equities tracking a rout in US shares that appeared poised to deepen on Tuesday amid investor jitters over trade and the technology sector. The dollar dipped and Treasuries were steady.
Declines in tech and bank shares pushed down the Stoxx Europe 600 and equities fell from Tokyo to Sydney after US software developers and semi conductor manufacturers drove the S&P 500 Index lower Monday.
Gold edged higher, European bonds were mostly lower and the 10-year Treasury yield held at about 3.06% ahead of the US Thanksgiving holiday Thursday. After a downdraft in October, equity markets can’t seem to catch a break this month as some of the same technology companies that helped drive the S&P 500 to a record high earlier this year tumbled amid a slowdown in consumer sales and fears over regulation. Alongside the stock rout a gloomy macro outlook is emerging.
Ray Dalio, founder of Bridgewater Associates, the world’s largest hedge fund firm, said that investors should expect low returns for a long time after years of low interest rates and quantitative easing. “The easy days of long, global bull markets where you can invest in a tracker for five basis points - I say this as an active fund manager - and watch the thing go up, I think those days are gone,” Gerry Grimstone, chairman of Barclays Bank PLC and Standard Life Aberdeen, said in an interview on Bloomberg Television.
“It’s going to be a move back to value investing, and back to the Warren Buffett-style of investment.”
Elsewhere, the pound stabilised as Theresa May appealed to business leaders to help deliver her Brexit deal, and evidence mounted that a plot to oust her as UK Prime Minister is faltering. Bitcoin fell below $5,000 for the first time since October 2017. Crude traded around $57 a barrel.
20 Nov 2018
Asian stocks fall as US tech sinks; bonds steady
Stocks in Asia declined on Tuesday after weakness in some of the biggest technology companies sent US stocks tumbling, adding to pessimism about a breakthrough in trade tensions.Equities fell from Tokyo to Sydney as S&P 500 Index futures extended losses.
Earlier, US software developers and semiconductor manufacturers led the US gauge lower on Monday amid a myriad of concerns swirling around the tech sector.
Japanese automakers were under pressure with Nissan Motor tumbling after the arrest on misconduct allegations of the carmaker’s chairperson, Carlos Ghosn. The dollar and Treasuries were little changed.In the US session, the Nasdaq 100 Index plunged more than 35 to the lowest since April.
Apple slumped on signs of slowing demand for iPhones, while Facebook's public image continued to weigh on its share price. Chipmaker Nvidia plunged almost 28% in two days after disappointing earnings, sending shock waves through chipmakers.
20 Nov 2018
Rand will struggle to stay below R14/$ - Bianca Botes
"The mighty rand edged below R14.00/$ during trade yesterday, as the mood surrounding the sterling and the dollar was far more subdued. After months of emerging market sell-offs, it seems as though the market is realising that the rand in particular is oversold, bringing some much-anticipated relief.
The rand has traded within a range of R14.00 to R14.50 for the most part of late.
In intraday trade, however, the local currency is likely to move between R13.90 and R14.10.
While the rand has recovered a fair amount of lost ground, it lacks the momentum to remain below the R14.00/$ mark, which we could still see come through on Thursday should the SARB increase interest rates."
- Bianca Botes, Peregrine Treasury Solutions
20 Nov 2018
Tokyo stocks open lower, Nissan down over 6%
Tokyo stocks opened lower on Tuesday with shares in Nissan diving more 6% and Mitsubishi also plunging after chairman Carlos Ghosn was arrested over allegations of financial misconduct.
The benchmark Nikkei 225 index was down 1.08% or 235.19 points at 21 585.97 in early trade, while the broader Topix index was down 0.97% or 15.91 points at 1 621.70. Nissan shares traded 6.05% lower at ¥944.6 after dipping to a low of ¥940, down 6.51%, at one point.
20 Nov 2018
Bid to topple British PM Theresa May falters as Tory lawmaker revolt struggles
Evidence is mounting that the plot to oust UK Prime Minister Theresa May is faltering.To trigger a vote of no confidence in her leadership, a total of 48 Conservative lawmakers need to submit letters, texts or emails calling for one.
Late last week, as the backlash against May’s Brexit deal gathered pace, there was speculation that the threshold could be reached at any moment.
But on Monday, the euroskeptic European Research Group, which has waged a concerted media campaign to keep up the pressure, appeared distinctly less ebullient.
As a person familiar with the situation said the key number had not been reached, one Tory Brexiteer hinted that now might not be the best time to strike.