JSE stocks ended slightly lower as subdued commodity prices and concerns about Chinese growth pulled resource shares down.]]> |||
Johannesburg - South African stocks ended Friday slightly lower as subdued commodity prices and concerns about Chinese growth pulled resource shares down, although other sectors were propped up by global market relief over the outcome of Scotland's referendum.
Shares on the back foot included iron ore producer Kumba , which shed 1.15 percent.
Bullion producers were also under pressure as the precious metal was poised for its third straight weekly drop in the face of dollar gains, with Johannesburg's Gold Mining index shedding 0.15 percent.
On the upside, shares of e-commerce firm Naspers added 2.1 percent, extending gains from the previous session after brokerage house UBS raised its rating for the group to 'buy' from 'neutral'.
UBS cited “the structural growth opportunities in both its PayTV business, and unlisted internet assets.”
World equities rallied on Friday as Scotland's decision to stay in the United Kingdom lifted Europe and got investors over the latest in a recent run of tricky global political hurdles, helping minimise losses in Johannesburg where the market was positive for much of the session.
The benchmark Top-40 index slipped 0.14 percent to 46,163 while the wider All-share index dropped 0.16 percent to 51,462.
Both indices remain near life highs scaled in July but with commodity prices on the wane, the market might struggle to reach them again anytime soon.
“The commodity story is not looking great, so for the overall JSE I can't see what else can push us higher at the moment,” said Abri du Plessis, chief investment officer at Gryphon Asset Management.
“The rest of the market is just being pulled up by easy monetary policy globally.” - Reuters]]>
Pound sterling jumped and British shares climbed after Scotland rejected independence from the United Kingdom in a landmark referendum.]]> |||
Frankfurt - Pound sterling jumped and British shares climbed in London on Friday after Scotland rejected independence from the United Kingdom in a landmark referendum.
But sterling slipped to 1.163 dollars (R12.82) later in the afternoon as investors began weighing the wider implications of the vote.
“The excitement is over,” said Commerzbank analyst Ulrich Leuchtmann.
Sterling had risen by almost one percentage point to 1.65 dollars in early trading as the news of the referendum results emerged.
London's stock market FTSE-100 index was 0.7-per-cent higher at 6865 points in late afternoon trading, with the vote in Scotland also allaying investors' fears that a UK breakup could spur independence in other parts of Europe.
Shares in Madrid posted a hefty gain of 1.23 per cent in the morning session as the Scottish vote appeared to reduce the risk of a push for independence in Spain's Catalonia region.
But as the trading day drew to a close, stocks in Madrid were up just 0.3 per cent.
Bourses in other parts of the world also climbed, with the referendum outcome removing the sense of uncertainty that has been hanging over British financial markets.
Investors had experienced a roller-coaster ride of anxiety in recent months when opinion polls showed the vote in Scotland as being too close to call.
The question of which currency an independent Scotland would adopt had played a central role in the referendum campaign.
“The uncertainty factor of recent weeks has been removed from the table,” analysts at DZ Bank said in a note to clients.
Leading the gain in British stocks was a surge in shares in the Royal Bank of Scotland (RBS) and Lloyds Banking Group, which have strong business links in Scotland.
Several large financial houses, including RBS, withdrew their threat to relocate their headquarters outside of Scotland.
But new questions have emerged after the vote.
Investors are now waiting for details of the British government's plans for the further devolution of powers across the United Kingdom.
“The UK has not come out of this unscathed,” said UniCredit Bank economist Daniel Vernazza.
British political leaders “have agreed to transfer substantial tax-raising powers, although differences remain between the parties,” he said.
“That transfer of powers will now have to be delivered.”
While shares in Asia closed higher, Europe's broad-based STOXX Europe 600 index was trading 0.5 per cent up at 349.56 points in late trading.
Wall Street also gained ground with the Dow Jones Industrial Average Index rising 0.4 per cent shortly after the New York market opened. - Sapa-dpa]]>
US stocks were rising, setting record highs on the Dow and S&P 500 after Scotland's vote to remain in the United Kingdom removed market uncertainty and Alibaba's strong pricing gave support to risk assets.]]> |||
New York - US stocks were rising in early trading on Friday, setting record highs on the Dow and S&P 500 after Scotland's vote to remain in the United Kingdom removed market uncertainty and Alibaba's strong pricing gave support to risk assets.
Unionists' victory in Scotland's vote kept it in the United Kingdom and gave a boost to European stocks, while sterling rose against the euro and the US dollar.
“Disarray in the UK would have had a negative effect, further strengthening the dollar and weakening the commodities complex,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.
Regarding Alibaba, Hogan said, “a large, hyped IPO that has gone successfully has a large, positive halo effect on the market.”
Alibaba priced its initial public offering at $68 (R749) a share, the top end of the expected range, and early indications showed the stock could start trading between $84 and $87.
Shares of Yahoo, which is selling part of its Alibaba stake but will remain a top shareholder, were gaining 1.5 percent at $42.71.
The Dow Jones industrial average was rising 55.69 points, or 0.32 percent, to 17,321.68, the S&P 500 was gaining 5.16 points, or 0.26 percent, to 2,016.52 and the Nasdaq Composite was adding 11.95 points, or 0.26 percent, to 4,605.38.
The largest percentage gainer on the New York Stock Exchange was Dresser-Rand, rising 11.56 percent, while the largest percentage decliner was ITT Educational Services, down 28.50 percent.
Dresser-Rand was gaining 11.9 percent in heavy volume after a report Germany's Siemens plans to offer more than $6.1 billion, or $80 per share, for the US compressor and turbine maker.
ITT Educational Services tumbled to a 19-year low after the for-profit college operator said it received notice indicating the SEC may file an enforcement action against the company due to several loans that were provided to students.
Among the most active stocks on the NYSE were Bank of America, down 0.21 percent to $17.01; General Electric, up 0.44 percent to $26.33; and Pfizer, down 0.36 percent to $30.47.
On the Nasdaq, Microsoft, up 0.8 percent to $47.06, and Apple, down 0.3 percent to $101.46, were among the most actively traded besides Yahoo.
Advancing issues were outnumbering declining ones on the NYSE by 1,775 to 997, for a 1.78-to-1 ratio on the upside; on the Nasdaq, 1,492 issues were rising and 954 falling for a 1.56-to-1 ratio favouring advancers.
The benchmark S&P 500 index was posting 70 new 52-week highs and 3 new lows; the Nasdaq Composite was recording 63 new highs and 31 new lows.
Oracle shares were falling 4.6 percent at $39.65 after Larry Ellison, co-founder and leader for 37 years, stepped aside as chief executive.
He will be replaced by co-chief executives Safra Catz and Mark Hurd, raising questions about a job-sharing arrangement that has had mixed records elsewhere. - Reuters]]>
In advance of the widely anticipated trading debut of Alibaba Group, the New York Stock Exchange said all of its systems are operating normally.]]> |||
New York - In advance of the widely anticipated trading debut of Alibaba Group, the New York Stock Exchange on Friday said all of its systems are operating normally.
In a market status update issued to clients at 7:30 am (13:30 SA time), the exchange said, “Common Customer Gateways (CCGs) are open for members to submit orders. All NYSE systems are currently operating normally.”
Alibaba, which priced its massive initial public offering at $68 (R750) a share late on Thursday, will begin trading on the NYSE under the ticker “BABA” later on Friday morning.
Ahead of that, the NYSE had performed extensive testing of its trading systems in a bid to ensure its debut goes smoothly. - Reuters]]>
Investors in British financial markets breathed a sigh of relief on Friday, after a Scottish vote against independence spared them prolonged and unprecedented uncertainty that a break up of the United Kingdom might have unleashed.]]> |||
London - Investors in British financial markets breathed a sigh of relief on Friday, after a Scottish vote against independence spared them prolonged and unprecedented uncertainty that a break up of the United Kingdom might have unleashed.
Stocks rose, sterling hit a two-year high against the euro, and currency market volatility - which had reached historically high levels ahead of Thursday's vote - collapsed.
Royal Bank of Scotland said it had scrapped contingency plans to relocate to England.
Shares in RBS and other financial firms, particularly those domiciled in Scotland, led the stock market rally.
Scotland's rejection of independence ended a fraught few weeks for markets that had seen the value of sterling fall sharply after some polls suggested the 307-year old union was on the brink of collapse.
The vote not only keeps Britain intact but also reduces the likelihood of its leaving the European Union, potentially a much greater risk for markets and something Scottish independence might well have precipitated, analysts said.
“The removal of the risk of a UK break-up is positive for UK assets,” said Goldman Sachs.
The FTSE 100 index of leading shares rose 0.6 percent.
RBS was up 3 percent, Lloyds was up 2 percent and insurance giant Standard Life was up 1 percent.
Shares of firms with significant exposure to the North Sea oil industry also outperformed the broader market.
Glasgow-based oil and gas services firm Weir Group North Sea rig operator Petrofac rose 1.5 percent.
Oil giant Royal Dutch Shell said the rejection of independence “reduces the operating uncertainty for businesses based in Scotland.”
Some of the most dramatic market moves were in the foreign exchanges, particularly in options, which are used by traders and investors to protect themselves against sharp swings in exchange rates.
Volatility had risen before Thursday's referendum to levels not seen since the collapse of Lehman Brothers in 2008 and the unusually uncertain UK general election of 2010.
The cost of insuring against sterling volatility over the next week more than halved to 5.4 percent from a close on Thursday of 11.8 percent and overnight volatility plunged to 9 percent from 23 percent.
Sterling itself strengthened, recovering ground lost since the start of the month after one poll put the “Yes” campaign for independence in the lead for the first time in over a year.
The pound rose to a two-year high against the euro, with the single currency trading as low as 78.10 pence, and rose above $1.65 against the dollar.
But those gains had already started to evaporate by mid-morning on Friday and the pound fell back below $1.64.
Major political risks, from the fallout of this vote to next May's general election, still lie ahead for the pound, analysts said.
“Even though the victory of the “No” campaign has avoided a huge political upheaval in the UK, winds of change will still be felt which implies that politics are more likely to be responsible for further bouts of volatility in UK markets over the next few years,” said Jane Foley, senior currency strategist at Rabobank.
Market-based UK interest rates rose, as investors bet there will now be less impediment to the Bank of England's raising rates as planned, perhaps as early as next year.
The yield on 2-year gilts rose to its highest in over two months at 0.926 percent and the yield on 10-year gilts rose to a six-week high of 2.603 percent before falling back.
“While there are lots of political questions to be answered, in terms of extra devolution, the economic questions will gravitate back to monetary policy,” said RBC economist Sam Hill. - Reuters]]>
US stock index futures were rising, building on record highs set in the previous session by the Dow industrials and S&P 500 and ahead of the debut of Alibaba Group on the New York Stock Exchange.]]> |||
New York - US stock index futures were rising early on Friday, building on record highs set in the previous session by the Dow industrials and S&P 500 and ahead of the debut of Alibaba Group on the New York Stock Exchange.
* Alibaba priced its initial public offering on Thursday at $68 (R750) a share, the top end of the expected range, giving it more market value than US e-commerce rivals Amazon and eBay.
* Shares of Yahoo, which is selling part of its Alibaba stake but will remain a top shareholder, were among the most traded on the Nasdaq.
Yahoo has risen 4.1 percent so far this year, compared with a 10 percent gain in the Nasdaq Composite.
* Oracle shares fell 3 percent premarket after Larry Ellison, co-founder and leader for 37 years, stepped aside as chief executive.
He will be replaced by co-chief executives Safra Catz and Mark Hurd, raising questions about a job-sharing arrangement that has had mixed records elsewhere.
* The Conference Board's Leading Economic Index for August is due at 10:00 a.m. (16:00 SA time).
The index posted a 0.9 percent increase in July.
Futures snapshot at 7:29 EDT (13:29 SA time):
* S&P 500 e-minis were up 6 points, or 0.3 percent, with 30,319 contracts changing hands.
* Nasdaq 100 e-minis were gaining 13.5 points, or 0.33 percent, in volume of 2,848 contracts.
* Dow e-minis were up 69 points, or 0.4 percent, with 2,559 contracts changing hands. - Reuters]]>
UK banks and asset managers led London equity indexes higher after Scottish voters rejected independence.]]> |||
London - UK banks and asset managers led London equity indexes higher on Friday after Scottish voters rejected independence, prompting a relief rally from investors who had been concerned the United Kingdom might break up.
Lenders with strong exposure to Scotland, including Royal Bank of Scotland and Lloyds Banking Group, were up 2 percent to 3.4 percent.
Asset managers Schroders, St. James' Place and Aberdeen Asset Management rose between 1.2 percent and 3.1 percent.
A vote for independence would have raised immediate questions over what currency Scotland would use and its position within the European Union.
Trading volume in RBS was particularly strong, already at its normal 90-day daily average after an hour's trade, contrasting with the broader FTSE 100 on around 40 percent.
The blue-chip FTSE 100 index was up 40.00 points, or 0.6 percent, at 6,859.29 points by 10:02 SA time, trading back up at levels last seen at the start of the month.
Scotland's vote against independence ended a skittish two weeks for the UK benchmark index, which dropped sharply when one poll unexpectedly showed a lead for the pro-independence side.
Engineering groups Weir and Babcock were up between 1.6 percent and 2 percent.
Shares of firms with significant exposure to Britain's North Sea oil industry also rose, with North Sea rig operators Petrofac and Enquest up 1.4 percent and 1.5 percent respectively.
A basket of top Scotland-based stocks on the broader FTSE 350 index also traded higher, with its dozen or so components up between 1 and 3.4 percent.
“The markets were pricing in a no vote... but now that we've got confirmation of that it's going to propel stocks on from here,” Mike McCudden, head of derivatives at Interactive Investor, said.
A 4.3 percentage point drop in the FTSE 100 Volatility Index, which measures the price of options on UK blue-chip stocks, suggested the relief over the vote could set the market up for a smoother ride.
Trading could be choppy in morning trade, however, due to “triple-witching” - when the contracts for stock index futures, stock index options, and stock options expire on the same day. - Reuters]]>
European shares surged after Scotland's decision to vote “No” to independence from the United Kingdom buoyed equity markets.]]> |||
London - European shares surged on Friday after Scotland's decision to vote “No” to independence from the United Kingdom buoyed equity markets and eased concerns about similar separatist movements in Spain.
The pan-European FTSEurofirst 300 index rose 0.9 percent to hit a new peak for 2014 of 1,410.93 points - and marking its highest level since early 2008.
The euro zone's blue-chip Euro STOXX 50 index rose 0.7 percent, while Germany's DAX and France's CAC both advanced by 0.6 percent.
Spain's IBEX outperformed with a 1.3 percent rise, helped by a fall in Spanish 10-year government bond yields as markets viewed Scotland's “No” vote in its independence referendum as having reduced prospects of a stronger push for a breakaway in Catalonia.
The European stock markets tracked gains on Britain's FTSE 100, which rallied after Scotland spurned independence in a historic referendum that threatened to rip the United Kingdom apart, sow financial turmoil and diminish Britain's remaining global clout.
The Scottish “Yes” campaign, which had backed independence, had gained ground over the last two weeks but had been continuously hindered by concerns over what currency an independent Scotland would use.
“For the markets in general, the Scottish result is probably the best outcome because the 'Yes' vote winning was really not priced in and that could have caused chaos, with contagion to Europe,” said Clairinvest fund manager Ion-Marc Valahu.
BANKING SHARES RISE
The STOXX Europe 600 Banking Index rose 0.9 percent, helped by gains in UK lenders Royal Bank of Scotland and Lloyds - which owns Bank of Scotland - on relief following the Scottish vote.
RBS and Lloyds had fallen in the build-up to the Scottish vote, due to concerns that any decision to vote in favour of independence could make investors uncertain about the future regulatory framework for such banks.
“There's a bit of a relief rally on the banks,” said Toby Campbell-Gray, head of trading at Tavira Securities. - Reuters]]>
Hong Kong shares had solid rises, after Alibaba Group's red-hot initial public offering underpinned US bourses, but they were still down for for the week.]]> |||
Hong Kong - Hong Kong shares had solid rises on Friday, after Alibaba Group's red-hot initial public offering underpinned US bourses, but they were still down for for the week.
The Hang Seng Index advanced 0.6 percent at 24,306.16 points on the day, leaving it down 1.2 percent for the week.
The China Enterprises Index of the leading offshore Chinese listings in Hong Kong was down 2.1 percent on the week and 0.2 percent on Friday.
Banks with major British ties were stronger as Scottish voters decided to remain in the United Kingdom.
HSBC Holdings, top boost on the Hang Seng, added 1.7 percent to a seven-month high and Standard Chartered rose 0.9 percent.
Wynn Macau jumped 6.0 percent and Melco Crown Entertainment 4.7 percent, as money started flowing into battered casino stocks.
Chinese insurers also outperformed after the official Shanghai Securities News reported on Friday China is considering allowing them to issue preference shares in a bid to offer more funding options for the sector. - Reuters]]>
The British pound surged to a more than two-year high against the euro as Scotland vote against independence.]]> |||
Tokyo - The British pound surged to a more than two-year high against the euro Friday, while it also rallied against the dollar as Scotland appeared likely to vote against independence from the United Kingdom.
The euro tumbled to 0.7809 pounds in Tokyo trade, from 0.7882 pounds and its lowest level since July 2012, as dealers welcomed initial returns pointing to a disappointing night for the “Yes” camp.
Some news organisations have also called a “No” win.
Sterling also jumped to $1.6522 (R18.27), its highest level since early September and much stronger than the $1.6389 in New York.
It is also well up from the $1.6227 in Asia earlier Thursday.
The pound hit a six-year high of 180.16 yen, up from 178.78 yen Thursday.
“Although a large number of constituencies have still to declare, the results currently indicate that this will probably prove a vote in favor of remaining in the Union,” Simon Derrick, chief markets strategist at BNY Mellon in London, said.
And Sacha Tihanyi, senior currency strategist at Scotiabank in Hong Kong said the pound could rise as high as $1.66 during the day.
The British unit had suffered a sell-off in the past week after an opinion poll showed a majority of people in favour of leaving the 307-year-old union, which could have hammered the economy.
In July, sterling hit its highest level against the dollar since 2008 during the financial crisis, but then plummeted to a 10-month low as polls showed strong gains for the “Yes” campaign.
A vote to stay in the United Kingdom “would remove uncertainty over some very big issues”, said Alan Ruskin, global head of G10
foreign-exchange strategy at Deutsche Bank.
The pound “can now revert back to the traditional fundamentals which had been driving it, such as the relative strength of the UK economy and expectations of tightening by the Bank of England”, he told Dow Jones Newswires.
In other trading, the dollar soared to six-year highs at 109.26 yen, against 108.68 yen in New York, while the euro slipped to $1.2917 from $1.2921.
The European single currency bought 141.12 yen, well up from 140.43 yen on Thursday.
The dollar's gains reflect the increasing divergence between tightening US monetary policy and expectations for further easing by the Bank of Japan and European Central Bank.
The euro held steady despite a lower-than-expected uptake of the European Central Bank's first tranche of loans to banks. - Sapa-AFP]]>