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Daily Dose

Daily Dose

G Morning,

On the wires…

  • Saudi Arabia agrees to boost oil production after Joe Biden visits kingdom
  • Sri Lanka puts emergency in place ahead of parliament’s vote for new president
  • Eighth person arrested in connection with deadly shooting spree in Alexandra
  • Eskom sees load shedding over by end of next week
  • Ireland beat the All Blacks in NZ
  • Boks thankful for series win after 2nd test arrogance- Wayne

Quote of the day…

“The secret of getting ahead is getting started.” — Mark Twain

The indicators…

Currency crackdown…

FXOne would like to thank Wayne Rosenberg for his contribution to the crackdown this morning.

This time last week, the rand was marginally below the 17.00 level against the $. After what feels like WW3, we find ourselves a touch higher against the $, unchanged against the Euro and stronger against the GBP. Over the weekend, some assets have seen some decent corrections including Gold, copper (useful for China demand), Brent and the equity markets. It seems for now as if investors are value picking and it will be interesting to see if the rand can attract some positive support. Although the rand is struggling, the entire world is also in a bad place. The IMF have also added that they will “substantially” lower global growth expectations due to “shock after shock”. Eskom has announced that load shedding will in all likelihood end this week, but time has taught me never to bet on a racehorse donning a bandage. SA challenges remain deep beyond Eskom, but it would be nice to try and deal with them while the lights are on.

US equity markets were higher on Friday and Asia has followed suit this morning (Japan closed). This has been assisted by the Chinese Central Bank showing support to the construction industry in the wake of a potential mortgage crisis. It is US earnings season which will drive direction of the equity markets. US 10-year Treasury yields move below the 3% level again, while the seemingly oversold SA R2030 remains stubborn just below the 11.00% level. Brent is lower on successful talks between Biden and Saudi Arabia, on OPEC increased supplies. Bitcoin has also stabilised above the $20 000 mark but is still trading as cautiously as other risky assets. The $, although having traded below parity last week against the Euro, has lost some strength.

All indications point to a rand retracement. It is US earnings season, and we have several central bank rate decisions, including the SARB and the ECB. Volatility should be set to stay which should impact on the rand. Keep both hands on the wheel!

On the radar…

  • All – Russia/Ukraine Crisis
  • SA- MPC on Thursday
  • UK – BoE MPC Member Saunders Speaks
  • ECB- rate decision this week

Did you know?

Eating avocados can help boost your mood – they’re rich in tryptophan, a precursor to serotonin

Have a champion week,

Wayne

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