MARKETS IN A NUTSHELL
WORLD
EQUITIES
Global equities edged higher, led by US and Japanese bourses — while emerging markets, typically geared to growth and trade, fell on slowing growth fears
BONDS
Developed market government bond yields fell materially on weaker macro data and lower short-term cash yields — German 10-year bond yields are now deep into negative territory
CURRENCIES
Given growth and yield differentials, the US dollar was stronger against the euro — while the pound was lower on rising hard Brexit fears
COMMODITIES
Oil prices fell despite attacks on a Saudi Arabian oil facility, while copper declined and iron ore was sharply lower — but precious metals gained as investors found refuge in uncorrelated assets
ECONOMY
Global growth moderated on the escalating US-Sino trade war, rising hard Brexit risks and rising Middle East geopolitical risks — manufacturing is in a multi-month decline in the main manufacturing economies
MONETARY AND FISCAL POLICY
The US Federal Reserve lowered interest rates by half a percent and stopped rebalancing its balance sheet — while the ECB cut interest rates more deeply into negative territory and pleaded for pan-EU fiscal expansion
SOUTH AFRICA
EQUITIES
The FTSE/JSE Capped All Share Index tracked emerging bourses lower — with resources and financial shares falling most
BONDS
The SA All Bond Index edged higher — SA bonds are the best performing asset class on a year-to-date basis
CURRENCIES
The rand weakened sharply against the US dollar — as global investors sought safe-haven assets at the expense of growth-sensitive emerging markets
COMMODITIES
Oil prices fell despite attacks on a Saudi Arabian oil facility, while copper declined and iron ore was sharply lower — but precious metals gained as investors found refuge in uncorrelated assets
ECONOMY
The economy recovered from a very weak first quarter with improvements in mining activity and household consumption — but the rebound is off a low base and probably not sustainable
MONETARY AND FISCAL POLICY
SARB’s Monetary Policy Committee lowered the SA repo rate by just a quarter-point to 6.5% in July — suggesting a 2% real rate is appropriate, despite near recessionary conditions and benign inflation