Daily Financial Markets Report: Wednesday 12 February 2014

sacciDaily Financial Markets Report sources information from Business Day, Reuters, JSE Ltd and others.

Highlights

 U.S. stocks extended their four-day winning streak, ending Tuesday with solid gains as Federal Reserve Chairwoman Janet Yellen pledged to keep interest rates low and to continue to taper the pace of bond purchases if the economy keeps improving. European stock markets headed for a fifth straight day of gains on Tuesday as investors waited for Janet Yellen to give her first testimony as U.S. Federal Reserve Chairwoman later in the day. Market participants will be watching closely for any signals on changes to monetary policy, although most analysts expect her to stick to the current strategy. Asian markets moved higher this morning after U.S. Federal Reserve Chairwoman Janet Yellen suggested that there would be no major change in the central bank’s policy, while stronger-than-expected trade data pushed Hong Kong higher.

 The US dollar is currently trading at 1.37 to the euro, 1.64 to the pound and will buy 102.53 Japanese Yen or 10.91 South African Rand.

 Spot gold is currently trading at US$ 1 285.50/oz. and platinum at US$ 1 388.10/oz. Brent crude oil is currently trading at US$ $ 108.83 per barrel.

International markets

U.S. stocks extended their four-day winning streak, ending Tuesday with solid gains as Federal Reserve Chairwoman Janet Yellen pledged to keep interest rates low and to continue to taper the pace of bond purchases if the economy keeps improving. European stock markets headed for a fifth straight day of gains on Tuesday as investors waited for Janet Yellen to give her first testimony as U.S. Federal Reserve Chairwoman later in the day. Market participants will be watching closely for any signals on changes to monetary policy, although most analysts expect her to stick to the current strategy. Asian markets moved higher this morning after U.S. Federal Reserve Chairwoman Janet Yellen suggested that there would be no major change in the central bank’s policy, while stronger-than-expected trade data pushed Hong Kong higher.

The S&P 500 index closed up 1.1% at 1 819.75, its best gain over four straight days since Dec. 23, 2011. The Dow Jones Industrial Average closed up 1.2%, at 15 994.77 after briefly topping 16 000. The Nasdaq Composite ended the day 1%, higher at 4 191.04. The tech-heavy index turned positive for 2014 and is now up 0.3% so far this year.

The Stoxx Europe 600 index climbed 0.4% to 326.74, on track for the highest closing level in almost three weeks. Among country-specific indexes, the U.K.’s FTSE 100 index added 0.4% to 6 615.54, France’s CAC 40 index rose 0.3% to 4 251.21 and Germany’s DAX 30 index climbed 0.6% to 9 348.31.

Japan’s Nikkei was up 0.9%, Australia’s S&P/ASX 200 rose by 0.5% and South Korea’s Kospi was 0.2% higher. The Hang Seng Index was up 0.7% and the Hang Seng China Enterprises Index rose 0.9%. In mainland China, the Shanghai Composite was down 0.3% as the market fell back after gaining 2.9% over the last two sessions.

The US dollar is currently trading at 1.37 to the euro, 1.64 to the pound and will buy 102.53 Japanese Yen or 10.91 South African Rand.

Domestic markets

The JSE closed 55 points lower on Tuesday despite a strong run by miners‚ as the market reacted conservatively to a range of company earnings updates released during the day. The All Share index was 0.12% lower at 45 866.02 points‚ with financial and industrial counters leading the downside‚ with the gold index offering strong support.

The longer-dated benchmark R186‚ due in 2026‚ was trading at 8.710% from 8.750% at Monday’s close. The shorter-dated R157‚ redeemable in 2015‚ was trading at 7.120% from its previous close of 7.125%. The intermediate R207 bond‚ due in 2020‚ was bid at 8.275% and offered at 8.260% from its previous close of 8.300%.

Commodities

Spot gold is currently trading at US$ 1 285.50/oz. and platinum at US$ 1 388.10/oz. Brent crude oil is currently trading at US$ $ 108.83 per barrel.

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