Financial News 12th June 2023

Market Overview
The FTSE/JSE All Share closed at 76 936.11 last week, decreasing by 0.24%. During the previous week, telecommunication and financials sectors were the biggest contributors increasing by 7.58% and 7.36% respectively. The consumer discretionary and technology sectors were the biggest detractors decreasing by 4.42% and 2.86% respectively.

Looking at the MSCI indices, developed markets increased by 0.45% during the previous week, while emerging markets increased by 1.90% over the same period.

SA avoids recession
The South African economy increased by 0.4% during the first quarter of 2023, after a downwardly revised 1.1% decline in the prior quarter, thus avoiding a technical recession despite record levels of loadshedding. Annually, the GDP increased by 0.2% as at March, in line with market estimates

SA business confidence continues its slump
The RMB/BER business confidence index in South Africa fell to a near three-year low of 27 points in June. Sentiment deteriorated further due to continued loadshedding and challenging economic conditions amid rising interest rates and persistent inflation. The manufacturing sector continues to face the most headwinds, with confidence at 17 points, while retail confidence declined by 14 points to 20, reflecting pressures on profitability and worsening of business conditions.

Market Overview and Weekly Indicators courtesy of PPS Investments.

Equity markets await Fed decision while the rand rallies
THE rand exchange rate recovered sharply last week against the US dollar, pound and euro. Less load shedding domestically and more and more evidence that the US Federal Reserve would probably keep its bank rate the same at their meeting and press conference this coming Wednesday also helped the appreciation of the currency. Read the full IOL article here>

Oil inches down as investors mull Fed’s rates move
Oil prices edged lower on Monday before a Federal Reserve meeting as investors try to gauge the central bank’s appetite for further rate hikes, while concerns about China’s fuel demand growth and rising Russian crude supply weighed on the market. Read the full Business Day article here>

Top 5 things to watch in markets in the week ahead
It’s set to be a major week in markets – on Wednesday the Federal Reserve may pause a rate hike campaign that started 15 months ago, but it’s likely to be a close call and Tuesday’s U.S. inflation reading will be key. Read the full article here>

Gold edges down as dollar holds firm before Bank meetings
Gold prices dipped on Monday as the US dollar edged higher, and investors positioned for a series of major central bank policy meetings this week, with a likely pause in interest rate hikes by the US Federal Reserve. Read the full Business Day article here>

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