G morning, | |||||||||||||||||||||||||||||||||||||||||||||||||||||
On the wires… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Quote of the day | |||||||||||||||||||||||||||||||||||||||||||||||||||||
“We have a vision of South Africa in which black and white shall live and work together as equals in conditions of peace and prosperity.” ― Oliver Tambo | |||||||||||||||||||||||||||||||||||||||||||||||||||||
The indicators | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Currency crackdown… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
On Friday, the rand opened at the 16.61 level but slowly took some pain as we saw equity global equity markets head south. This equity sell off was caused by tech AI result related underperformance. That sector, for now, will only be a correction, as investors world-wide look to load up. This morning, we can see the recovery underway. EM currencies were all impacted with the Brazilian Real the worst performer (also election results related). The rand, unfortunately, is also being dragged lower as a result.
Indicators remain mostly non rand supportive: Gold is well lower again and Brent remains elevated, just below the $110 level. US bond market yields are lower, but there is still an 80% probability of a December rate hike. The $ although slightly weaker but has stabilised as we head into mid-terms (November 3). The immediate concern remains equity markets which were all well lower in the US On Friday night, as well in Jozi (-2.42%) on Friday. This morning Far Eastern markets are mixed but importantly, the Kospi is higher. US equity markets are priced to open higher this afternoon.
The keys for currency direction remain interest rate profiles (presently elevated) and the oil price. Equity markets are also being watched but should be ok headed into the end of the year. Any military escalation in the Middle East will not be well received by oil, and if it happens, should push the rand through the 16.80 resistance. Local elections will be analysed but generally they bring an improved rand performance. If no military strikes in the ME, then the rand hopefully, will head back into the more extended 16.30- 16.80 range. There is a lot happening…no golf or lunching!! | |||||||||||||||||||||||||||||||||||||||||||||||||||||
On the radar… | |||||||||||||||||||||||||||||||||||||||||||||||||||||
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Did you know? | |||||||||||||||||||||||||||||||||||||||||||||||||||||
The odds of dying in an air crash is 11 million to 1, for each flight.
Have a terrific week,
Wayne Rosenberg | |||||||||||||||||||||||||||||||||||||||||||||||||||||
