Trading Tuesday
Ranora Daily - Your daily source for reliable market analysis and news.
Market Data
Local
Global
*Data as of 4pm WAT
Market News
Local
FG plans $5bn for ICT firms, to raise telecom access - Punch
The Federal Government is set to equip three million Nigerians with tech skills over the next four years. It set a plan to help startups raise their yearly funding rounds to $5bn by 2027, and improve access in rural areas by at least 40 per cent.
Global
Kenya Central Bank Maintains Key Interest Rate at 10.5% - Bloomberg
Kenya’s central bank kept its benchmark interest rate unchanged for the second meeting in a row as it expects inflation to remain within its target range supported by lower food prices.
10-year and 30-year Treasury yields rise to their highest levels since 2007 - CNBC
U.S. Treasury yields rose Tuesday as investors considered the state of the economy as they awaited data that could inform monetary policy.
US Job Openings Top All Forecasts as White-Collar Positions Jump - Bloomberg
US job openings unexpectedly increased in August, fueled by a surge in white-collar postings, highlighting the durability of labor demand.
Weekly Investment Watchlist
Market Commentary:
Asia and Australia:
On Monday, most Asian equities were lower, with the Nikkei in Japan paring early gains to close slightly lower. The ASX (Australian Stock Exchange) also logged mild declines, while Taiwan experienced gains driven by solid performance in semiconductor stocks. Several markets, including Greater China, South Korea, and India, were closed for holidays.
The Bank of Japan announced another round of bond buying on October 4 for 5-year and 10-year JGBs (Japanese Government Bonds) after the 10-year yield hit its highest level since 2013. The USD/JPY spiked in response, nearing the 150 level. Japan’s Tankan survey, a key business sentiment indicator, came in positive.
Over the weekend, PMI (Purchasing Managers’ Index) data from China showed mixed results. The official NBS PMI indicated that manufacturing activity had improved, reaching expansionary territory at 50.2. However, the Caixin Manufacturing PMI came in lower than expected. Notably, the NBS survey has a larger sample set and focuses more on larger firms, while the Caixin survey concentrates on private firms and exporters.
The World Bank lowered its growth forecasts for China, citing slower growth and the challenges in the property market. While the 2023 forecast remained at 5%, the 2024 forecast was reduced to 4.4% from 4.8%. The World Bank noted that “Asia faces one of the worst economic outlooks in half a century.”
The Reserve Bank of Australia (RBA) was expected to leave the cash rate unchanged at 4.10% at its Tuesday policy meeting. This would be Michelle Bullock’s first meeting as governor.
PMI data across Asia still showed weakness, with the Philippines being the only country to show improvement and move into expansionary territory. The effects of the central banks’ rate hikes are still affecting economic growth and exports in these countries, with higher oil prices potentially exacerbating the situation.
Europe, Middle East, Africa:
European markets remained muted in Monday morning’s trading session.
Eurozone’s final PMI for September confirmed a broad-based downturn with a reading of 43.4, in line with the preliminary release and below August’s reading of 43.5.
Germany’s final PMI was slightly lower than the preliminary reading, coming in at 39.6 compared to the preliminary 39.8. Output fell at the fastest rate since May 2020 amid a sharp drop in new orders.
The UK’s final manufacturing PMI was little changed from the flash reading at 44.3, versus the preliminary 44.2 and the previous month’s reading of 43.0. There were signs that weakness in the manufacturing sector may have reached a trough after hitting a 39-month low in August.
Minutes from the September Riksbank policy meeting signaled readiness for another rate hike in the key policy rate and indicated plans to maintain a restrictive monetary policy for a longer duration to address inflationary pressures.
The Americas:
Bullish sentiment among investors fell to 27.8% in the week ending September 27, marking a decrease of 3.5 percentage points. This puts bullish sentiment below the historical average of 37.5% for the sixth time in the last seven weeks.
Kellogg’s breakup is set to proceed, with the company spinning off WK Kellogg (KLG), the North American cereal business. The parent company, Kellogg (K), will retain the global snacking business and change its name to Kellanova, remaining in the S&P 500. WK Kellogg will replace American Vanguard in the S&P 600.
KKR has completed the sale of over 5 million square feet of industrial warehouse and distribution properties for a total aggregate value of over $560 million. These dispositions were executed through five discrete transactions with five separate buyers. The final sale closed on September 29.
The Week Ahead:
Investment Tip of The Day
Be cautious of market timing. Attempting to time the market by predicting short-term price movements is challenging and can be risky. Focus on a disciplined investment approach rather than trying to predict market highs and lows.
Meme of the Day
