In the loop 09 July 2024

In the loop

Shireen Darmalingam

What you should know this morning:

The rand is weaker this morning, at R18.12/$, after closing stronger yesterday (R18.10/$*).
EM currencies were mixed yesterday; the COP (+1.0%), MXN (+0.5%) and ZAR (+0.4%) were the biggest gainers; the HUF (-0.6%), CLP (-0.3%) and CZK (-0.3%) were the biggest losers.
Asian equity markets are mixed this morning; the Nikkei is up, while the Hang Seng and Shanghai Composite are down.

The US NFIB small business optimism index, due out today, may have deteriorated slightly in June, after increasing for three consecutive months.
The index is likely to have slipped to 90.2 in June, from 90.5 in May.
Investors will keep an eye on the jobs sub-index.
An exceptionally high number of small business owners have at least one job opening that they are not able to fill.
This has forced some business owners to increase compensation but at the expense of profit margins.

Fed Chair Jerome Powell will provide his semi-annual monetary policy report to the Senate Banking Committee today.
The (Republican) committee is likely to question Powell on the economic consequences of inflation over the past four years.
The (Democratic) committee will likely urge Powell to commence the interest rate cutting cycle ahead of a further increase in unemployment.
Powell is due to deliver the testimony to the House Financial Services Committee tomorrow.

Several ECB policymakers are due to speak on the economy later today.
Investors will watch out for clues on whether the ECB is likely to cut rates further on 31 July.

Brent crude oil is currently at $85.54/bbl; ($85.75/bbl*).
Gold is at $2365/oz ($2358/oz*).
SA CDS 200bps*, Brazil 153bps* and Turkey 258bps*.
Yields: US 10yr at 4.27%, German bund at 2.54%*, SA 10-year generic at 10.1 %*, SA’s R2030 at 9.73%*.

* Denotes yesterday’s close.

Key events and data:

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