Financial News 4th September 2023

Market overview
The FTSE/JSE All Share closed last week at 74 786.81, increasing by 1.29%. The oil&gas and technology sectors increased by 4.64% and 4.16% respectively during the week. The health care and telecommunication sectors decreased by 4.54% and 1.84% during the same period.
Looking at the MSCI indices, developed markets increased by 2.71% during the previous week while emerging markets increased by 1.52% over the same period.

Big annual decrease in SA PPI
The annual producer price inflation (PPI) in South Africa decreased significantly to 2.7% in July, down from 4.8%, and below expectations of 2.9%. It was the lowest reading since October 2020, prompted by a decline in prices of coke, petroleum, chemical, rubber and plastic products. Moreover, costs decreased for food products, beverages and tobacco products also contributed to the decrease in PPI.
On a monthly basis, producer prices went up by 0.2% in July, after a 0.3% fall in the prior month and compared with market expectations of a 0.4% increase.

US GDP growth below forecasts
The US economy grew at an annualized rate of 2.1% in the second quarter of 2023, compared to the preliminary figure of 2.4% and the first quarter’s expansion of 2.0%. Growth rates decreased for both consumer spending and government consumption, while non-residential fixed investment experienced a significant increase.
Exports in the US experienced its largest decline since the aftermath of the COVID-19 outbreak in Q2 2020, and residential fixed investment decreased for the ninth consecutive period.

Thanks to PPS Investments for the weekly Market Overview.

South African rand edges up ahead of data-filled week
The rand gained slightly in early trade on Monday, ahead of a week of data releases which include the country’s second quarter gross domestic product (GDP) and current account. Read the full Reuters article here>

Stocks buoyed by China stimulus, Fed outlook hopes: Markets wrap
Stocks in Asia advanced as traders bet that China’s latest property stimulus measures will aid the economy and data suggested that US interest rates may be approaching a peak. read the full Moneyweb article here>

Equity markets suffered in August: Rand and higher oil prices pose a serious threat
South African equity prices performed poorly during August. Although most indices on the JSE recovered somewhat last week, stocks remain under pressure, on further inflation concerns and rising interest rate threats. Read the full IOL article here>

Petrol price hikes in September are worse than feared
The retail price of both grades of petrol will rise by R1.71 a litre. Read the full Business Day article here>

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