US markets fell on Friday with the start of the quarterly earnings season making for disappointing reading. JP Morgan and Wells Fargo led the financial sector lower. Attacks on Syria conducted by the US and its allies also accounted for some of the weakness in markets on Friday. UK markets climbed, but a stronger pound capped gains. Asian markets are struggling to set the tone this morning since attacks on Syria seem to be a once-off, but US sanctions on Russia is making traders nervous due to the latter’s ability to initiate a response.
South African News
SA markets just managed to keep head above water on Friday as weakness from Wall Street following market open later in the afternoon started to drag down SA indices. Resources were the best performing sector with gold mining companies benefitting from tensions in the Middle East that pushed gold prices higher. The rand depreciated against the dollar, and remains in its trading range that it’s been stuck in due to a lack of significant drivers.
Murray & Roberts [MUR] are not out of the woods yet as Aton received backing from Allan Gray. Aton previously made a formal bid to shareholders, looking to acquire the entire shareholding, but Murray & Roberts management advised against the offer. Allan Gray is one of the bigger shareholders through its fund’s holdings and have agreed to sell to Aton, giving the German company a firmer foot to stand on.
credit: Graph Provided by Sharenet Advanced Online Charts
The Day Ahead
The initial tone this morning is negative as we take direction from the US and China, but it looks likely to improve. Analysts are optimistic about US corporate earnings that are scheduled for release this week and we also receive Chinese GDP data before market open tomorrow morning and economic growth in China is expected to maintain its strong pace.
Key Results Out Today
US Retail sales
Quote of the day
"Anyone who stops learning is old, whether this happens at twenty or eighty. Anyone who keeps on learning not only remains young, but becomes constantly more valuable regardless of physical capacity." - Harvey Ullman
Quantitative Investment Analyst
Ian Stiglingh is a full time quantitative analyst, responsible for research of equities across all industries. Ian completed his degree in Mathematical Science in 2013 and his Honours degree in Financial Risk Management in 2014, both at the University of Stellenbosch. During his studies, Ian worked as an intern at Old Mutual Actuaries & Consultants as well as J.P. Morgan in Johannesburg, and is currently a CFA candidate