Closing the loop
Shireen Darmalingam
Market highlights:
- The rand is weaker at R14.57/$ (R14.41/$*) today; it traded in a range of R14.35/$ to R14.60/$.
- It is below its 50-day moving average (R14.74/$) and above its 100-day and 200-day moving averages (R14.52/$ and R14.56/$, respectively).
- EM currencies were largely down today; the TRY (-2.7%), ZAR (-1.0%) and PLN (-0.6%) were amongst the biggest losers.
- Pfizer remarked that a booster shot of their vaccine restored full protection, according to the results of a large study.
- The study showed that a booster jab was 95.6% effective against symptomatic Covid in the sample of 10,000 people aged 16 and older.
- The results are likely to support the argument for administering a third dose more widely.
- The Turkish Central Bank cut rates by 200 bps to 16% despite rising inflation and an ailing currency.
- President Recep Tayyip Erdogan has asserted more control over the independent central bank in recent years.
- He has been pushing for lower rates despite the upward inflation trend.
- The Turkish lira has lost further ground on the back of the announcement.
- Several PMI reports are due out tomorrow.
- The UK October manufacturing and services PMI are expected to have slipped.
- The EU PMI reports are also likely to have deteriorated in October, albeit remaining above the 50-benchmark line.
- The US PMI data for October are likely to present a mixed bag with the manufacturing index slipping and the services index improving.
- Also on the cards tomorrow is the release of the UK retail sales report for September; sales are expected to have contracted on a y/y basis.
- The oil price is down by 1.5% today and up by 63.2% in the year-to-date.
- The gold price is down by 0.3% today and down by 6.2% in the year-to-date.
- Brent crude oil is at $84.54/bbl; ($85.82/bbl*).
- Gold price is at $1780/oz ($1786/oz*).
- SA CDS is at 208bps (207bps), lower than Brazil 218bps (212bps*) and Turkey 453bps (447bps*).
- Yields: US 10yr at 1.67% (1.65%*), German bund at -0.091% (-0.126%*) and SA 10-year generic at 9.88% (9.78%*), SA’s R186 is at 7.93% (7.86%*).
- The JSE ALSI is down by 1.2% today (+0.2%*).
* Denotes yesterday’s close.
Key events and data:
- 01h01: UK GfK consumer confidence (October
- 01h30: Japan CPI (September)
- 02h30: Japan Jibun Bank manufacturing, services and composite PMI (October)
- 08h00: UK retail sales (September)
- 10h00: Eurozone Markit manufacturing, services and composite PMI (October)
- 10h30: Eurozone Markit manufacturing, services and composite PMI (October)15h45: US Markit manufacturing, services and composite PMI (October)
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