
<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="350" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1040865674-612x612-1.jpg" alt="" class="wp-image-400879" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1040865674-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1040865674-612x612-1-300x172.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Stock market report. 3d illustration</figcaption></figure>



<p>Aug 6 (Reuters)&nbsp;&#8211;&nbsp;Emerging market assets recouped some losses on Tuesday after a torrent of selling in the prior session, though a stronger dollar and continued concerns over global economic growth kept gains in check.</p>



<p>MSCI&#8217;s index of emerging market stocks rose 1.2% after its worst day in over two years on Monday, when a combination of concerns about a U.S. economic recession, disappointing tech earnings and geopolitical worries saw investors flee risk assets.</p>



<p>Emerging market stocks in Asia outside Japan rose 1%, helped by a sharp recovery in the Nikkei.</p>



<p>Still, some caution remained, with investors pricing in an 80% chance of a 50 basis point interest rate cut from the Federal Reserve in September, down from 86% on Monday. Policy easing in the U.S. typically benefits emerging market stocks and currencies.</p>



<p>&#8220;Large stock market movements often mean that investors are looking for answers to one or more questions, so even if the day looks like the situation is improving, it is best to assume that it will continue to be nervous for some time to come,&#8221; Marcus Widén, economist at SEB said.</p>



<p>The Japanese yen was a key beneficiary of risk aversion on Monday, which saw an unwinding of carry trades that hit many high-yielding emerging market currencies. The yen slipped on Tuesday, though a rebound in the U.S. dollar continued to weigh on EM currencies.</p>



<p>&#8220;Higher interest rates in Japan and expectations of greater and faster expectations of interest rate cuts in the U.S. changed the conditions for carry trades,&#8221; Widen added.</p>



<p>Turkey&#8217;s lira touched a fresh record low of 33.47 to the dollar, while the South African rand slipped 0.2%.</p>



<p>Malaysia&#8217;s ringgit lost over 1% against the dollar after surging over 2% on Monday. The Mexican peso was also down on the day after the carry trade favourite fell to a two-year low.</p>



<p>Among equities, Turkey&#8217;s Bist 100 rose 1.4% and the Prague bourse rose after falling over 4% the session prior.</p>



<p>Saudia Arabia&#8217;s benchmark index gained 1.8%, with Saudi Aramco rising 2.2% after reporting a second-quarter net profit of 109.01 billion riyals.</p>



<p>Central European currencies weakened against the euro, with the Czech crown, Polish zloty and Hungarian forint slipping between 0.1% and 0.3%.</p>



<p>Meanwhile the International Monetary Fund said it was &#8220;fully committed to Bangladesh&#8221; after Prime Minister Sheikh Hasina resigned and fled the country following student-led protests.</p>



<p>Kenya&#8217;s shilling edged down 0.2% against the dollar ahead of a monetary policy announcement.</p>



<p>(Reporting by Lisa Pauline Mattackal in Bengaluru; Editing by Christina Fincher)</p>


Stock market report. 3d illustration

EM stocks recover after bruising selloff, dollar recovery weighs on currencies


<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-820x547.jpg" alt="" class="wp-image-505638" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-768x513.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864874-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A South African one rand coin sits on South African rand banknotes in this arranged photograph in Pretoria, South Africa, on Wednesday, Aug. 14, 2019. The rand ended a tumultuous week on a positive note, gaining against the dollar for a second day and heading for its first weekly advance in four as technical indicators suggested recent declines are overdone. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



<p>JOHANNESBURG, Aug 6 (Reuters)&nbsp;&#8211;&nbsp;The South African rand clawed back ground in early trade on Tuesday as risk sentiment improved, after tanking on Monday on fears of a possible recession in the United States.</p>



<p>At 0649 GMT, the rand traded at 18.45 against the dollar, about 0.4% firmer than its previous close.</p>



<p>Friday&#8217;s weak U.S. July payrolls report stoked recession worries and led to a plunge in global equities, with traders fleeing to safe havens.</p>



<p>&#8220;The rand opened below the R18.50 handle this morning after risk sentiment improved in the early morning hours,&#8221; said Andre Cilliers, currency strategist at TreasuryONE.</p>



<p>&#8220;We will still take our cues from global risk sentiment and could expect volatility to remain for the days to come,&#8221; Cilliers added.</p>



<p>U.S. central bank policymakers pushed back on Monday against the notion that the economy is close to recession, but indicated the Federal Reserve will need to cut rates to avoid such an outcome.</p>



<p>Like other risk-sensitive currencies, the rand often takes cues from global drivers such as U.S. economic data and monetary policy in addition to local factors.</p>



<p>South Africa&#8217;s benchmark 2030 government bond was also firmer in early deals, with the yield down 3.5 basis points to 9.325%.</p>



<p>(Reporting by Tannur Anders; Editing by Christina Fincher)</p>


South African Rand Rebound Snaps Streak of Weekly Losses

South African rand claws back losses as risk sentiment improves


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="408" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg" alt="" class="wp-image-400697" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1-300x200.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Double exposure of coin stack with city background and world map, financial graph, world map and global network business concept idea, element by NASA.</figcaption></figure>



<p>JOHANNESBURG, Aug 6 (Reuters)&nbsp;&#8211;&nbsp;The following scheduled economic events, company announcements, equity and currency market moves may affect South African markets on Tuesday.</p>



<h2 class="wp-block-heading" id="h-economic-events">ECONOMIC EVENTS</h2>



<p>South Africa&#8217;s government will hold its weekly auction of long-term bonds.</p>



<h2 class="wp-block-heading" id="h-companies">COMPANIES</h2>



<p>Nedbank Group recorded an 8% rise in half-year headline earnings supported by good non-interest revenue growth, a lower impairment charge and tight cost control.</p>



<p>AngloGold Ashanti will release first-half results.</p>



<h2 class="wp-block-heading" id="h-south-african-markets">SOUTH AFRICAN MARKETS</h2>



<p>South African stocks and the rand fell on Monday as global investor sentiment towards riskier assets soured on growing fears over a possible recession in the United States.</p>



<p>On the Johannesburg Stock Exchange, the Top-40 index was down about 2.3%, mirroring a sell-off on global stock markets.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Japanese stocks jumped at the open on Tuesday, underpinning a recovery across battered Asian share markets, after central bank officials said all the right things to soothe investor nerves.</p>



<h2 class="wp-block-heading" id="h-wall-street">WALL STREET</h2>



<p>U.S. stocks ended with steep losses on Monday, leaving the Nasdaq and S&amp;P 500 down at least 3% each as the market extended last week&#8217;s sell-off amid U.S. recession worries and as Apple shares fell sharply on news that a big investor had cut its stake.</p>



<h2 class="wp-block-heading" id="h-gold">GOLD</h2>



<p>Gold prices edged higher on Tuesday after comments from Federal Reserve officials reinforced expectations of bigger U.S. interest rate cuts later this year.</p>



<p>&#8211; &#8211; &#8211; &#8211;</p>



<p>Some of the main stories out in the South African press:</p>



<h2 class="wp-block-heading" id="h-business-day">BUSINESS DAY</h2>



<p>&#8211; Treasury eases tough-love approach to Transnet</p>



<p>&#8211; Wind power sector ‘deeply concerned’ after regulator rejects Eskom’s reservation request</p>



<p>(Compiled by Tannur Anders)</p>


istockphoto-1076949610-612×612-1

South African Markets – Factors to watch on Aug 6


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



<p>NAIROBI, Aug 6 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Tuesday.</p>



<h2 class="wp-block-heading" id="h-events">EVENTS:</h2>



<p>*Kenya&#8217;s central bank is due to announce its latest benchmark lending rate decision.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Japanese stocks jumped at the open on Tuesday, underpinning a recovery across battered Asian share markets and even triggering circuit breakers in some, after central bank officials said all the right things to soothe investor nerves.</p>



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



<p>Oil prices rebounded by more than 1% on Tuesday, paring previous session&#8217;s losses, on supply concerns amid an escalating Middle East conflict, stronger U.S. services sector data and a cut in production at Libya&#8217;s Sharara oilfield.</p>



<h2 class="wp-block-heading" id="h-south-africa-markets">SOUTH AFRICA MARKETS</h2>



<p>South African stocks and the rand tanked on Monday as global investor sentiment soured towards riskier assets due to growing fears over a possible recession in the United States.</p>



<h2 class="wp-block-heading" id="h-nigeria-politics">NIGERIA POLITICS</h2>



<p>Protests in Nigeria over the soaring cost of living ebbed on Monday, with only a few hundred people turning out in major cities following a deadly crackdown by security forces since the demonstrations began last week.</p>



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



<p>Kenya&#8217;s shilling firmed slightly in early trade on Monday and it was expected to strengthen further, fuelled by dollar inflows from the tea sector, traders said</p>



<h2 class="wp-block-heading" id="h-kenya-private-sector-activity">KENYA PRIVATE SECTOR ACTIVITY</h2>



<p>Kenya&#8217;s private sector activity dropped in July, undermined by the effects of public protests against the government which hurt confidence in the economy and disrupted some business activity, a survey showed on Monday.</p>



<h2 class="wp-block-heading" id="h-uganda-politics">UGANDA POLITICS</h2>



<p>Police arrested 14 Ugandan opposition officials and supporters on Monday as they marched through their capital towards the Kenyan embassy to protest against Nairobi&#8217;s decision to detain and deport a group of their colleagues, local media said.</p>



<h2 class="wp-block-heading" id="h-ivory-coast-cocoa">IVORY COAST COCOA</h2>



<p>Cocoa arrivals at ports in top grower Ivory Coast had reached 1.668 million metric tons by August 4 since the start of the season on Oct. 1, down 26.8% from the same period last season, exporters estimated on Monday.</p>



<h2 class="wp-block-heading" id="h-democratic-republic-of-congo-mining">DEMOCRATIC REPUBLIC OF CONGO MINING</h2>



<p>China&#8217;s CMOC and other miners have applied for copper from Democratic Republic of Congo (DRC) to be registered for delivery against London Metal Exchange (LME) contracts, four sources with knowledge of the matter said.</p>



<p>((Compiled by Nairobi Newsroom))</p>


World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on Aug 6


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1152" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-scaled.jpg" alt="" class="wp-image-400641" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-820x461.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-1536x864.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A collection of mixed denomination South African rand coins sit in an arranged photo in Johannesburg, South Africa, on Thursday, June 22, 2017. South Africas inflation rate rose for the first time this year in May after food-price growth quickened from the slowest pace since December 2015. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



<p>JOHANNESBURG, Aug 5 (Reuters)&nbsp;&#8211;&nbsp;South African stocks and the rand tanked on Monday as global investor sentiment soured towards riskier assets due to growing fears over a possible recession in the United States.</p>



<p>At 1206 GMT, the rand traded at 18.5825 against the dollar, about 1.7% weaker than its previous close and near a two-month low. The rand had lost more than 2% against the greenback in earlier trade.</p>



<p>On Johannesburg Stock Exchange, the Top-40 index was down about 2.3%, mirroring a sell-off on global stock markets.</p>



<p>Markets have been hit by Friday&#8217;s weak U.S. July payrolls report, which showed the unemployment rate had risen to 4.3%, stoking concerns the world&#8217;s biggest economy may be heading for a recession.</p>



<p>&#8220;The ongoing equity market correction provides a glimpse of the kind of volatility that can be expected through the months ahead &#8230; (but) it will eventually trigger more aggressive rate cuts in the world&#8217;s top economies,&#8221; said Danny Greeff, co-head of Africa at ETM Analytics.</p>



<p>Traders are pricing in a near 100% chance that the Federal Reserve will cut interest rates by a full 50 basis points in September to rescue growth, compared with an 11.5% chance a week earlier, according to the CME FedWatch tool.</p>



<p>Rate cuts in the world&#8217;s biggest economies should lead to corrections in overvalued major currencies, Greeff added.</p>



<p>&#8220;The rand is thus still expected to strengthen through the coming quarters, but it will be far from smooth sailing,&#8221; he said.</p>



<p>Like other risk-sensitive currencies, the rand often takes cues from global drivers such as U.S. economic data and monetary policy in addition to local factors.</p>



<p>South Africa&#8217;s benchmark 2030 government bond was also weaker, as the yield gained 9.5 basis points to 9.345%.</p>



<p>(Reporting by Tannur Anders;Editing by Bhargav Acharya and Helen Popper)</p>


South African Economy As Inflation Rate Rises For First Time In 2017

South African rand, stocks sink as US recession fears hit riskier assets


<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="517" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-820x517.jpg" alt="" class="wp-image-515280" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-820x517.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-300x189.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-143x90.jpg 143w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-768x484.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-1536x968.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/AS7LW77Q75MZNCRQYFM67SUJRQ-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A worker looks on next to loafs of bread at a spaza shop in Thembisa, on the East Rand, in South Africa, August 2, 2023. REUTERS/Siphiwe Sibeko/file photo</figcaption></figure>



<p>JOHANNESBURG, Aug 5 (Reuters)&nbsp;&#8211;&nbsp;South African private sector activity remained subdued in July amid weaker sales and increased supply-side pressures, a survey showed on Monday.</p>



<p>The S&amp;P Global South Africa Purchasing Managers&#8217; Index (PMI) rose slightly to 49.3 in July from 49.2 in June, but remained below the 50 level which marks growth for the second month in a row.</p>



<p>South Africa&#8217;s private sector saw &#8220;new orders continuing to decline and supplier performance worsening as global transport issues and domestic port congestion hindered vendors,&#8221; said David Owen, senior economist at S&amp;P Global Market Intelligence.</p>



<p>This forced businesses to cut their output at the sharpest rate in four months.</p>



<p>South Africa&#8217;s logistics firm Transnet suspended operations at some of its ports in July as strong winds and waves lashed parts of the country, setting back efforts to clear backlogs.</p>



<p>However, firms were upbeat that conditions would improve in the coming 12 months, Owen said.</p>



<p>&#8220;Many suggested that the stabilisation in the political landscape should lead to greater confidence and a pick-up in spending, while reduced load shedding (power cuts) and softer price pressures are also expected to support growth,&#8221; Owen added.</p>



<p>(Reporting by Tannur Anders; Editing by Susan Fenton)</p>


A worker looks on next to loafs of bread

South Africa business activity contracts again in July, PMI shows


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="408" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg" alt="" class="wp-image-400697" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1-300x200.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Double exposure of coin stack with city background and world map, financial graph, world map and global network business concept idea, element by NASA.</figcaption></figure>



<p>JOHANNESBURG, Aug 5 (Reuters)&nbsp;&#8211;&nbsp;The following scheduled economic events, equity and currency market moves may affect South African markets on Monday.</p>



<h2 class="wp-block-heading" id="h-economic-events">ECONOMIC EVENTS</h2>



<p>South Africa&#8217;s Johannesburg Stock Exchange will release data on foreigners&#8217; buying and selling of bonds and stocks during the previous week.</p>



<p>South Africa&#8217;s government will hold its weekly auction for Treasury bills.</p>



<h2 class="wp-block-heading" id="h-south-african-markets">SOUTH AFRICAN MARKETS</h2>



<p>The South African rand firmed on Friday as U.S. economic data showed a slowdown in jobs growth in July and a rise in the unemployment rate, boosting bets of a September rate cut in the world&#8217;s biggest economy and pressuring the dollar.</p>



<p>On the Johannesburg Stock Exchange, the blue-chip Top-40 index closed about 1.7% down. South Africa&#8217;s benchmark 2030 government bond was stronger, with the yield down 9.5 basis points at 9.25%.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Share markets tumbled and bonds rallied in Asia on Monday as fears the United States could be heading for recession sent investors rushing from risk assets while wagering that rapid fire rate cuts will be needed to rescue growth.</p>



<h2 class="wp-block-heading" id="h-wall-street">WALL STREET</h2>



<p>U.S. stocks sold off for a second straight session on Friday, and the Nasdaq Composite confirmed it was in correction territory after a soft jobs report stoked fears of an oncoming recession.</p>



<h2 class="wp-block-heading" id="h-gold">GOLD</h2>



<p>Prices of safe-haven gold were flat on Monday as some profit-taking partially offset support from U.S. recession jitters and rising expectations of a September rate cut from the Federal Reserve.</p>



<p>&#8211; &#8211; &#8211; &#8211;</p>



<p>Some of the main stories out in the South African press:</p>



<h2 class="wp-block-heading" id="h-business-day">BUSINESS DAY</h2>



<p>&#8211; Engineering economic recovery set to take centre stage at ANC lekgotla</p>



<p>&#8211; SA can create up to 275,000 green jobs by 2030, report shows</p>



<p>(Compiled by Tannur Anders)</p>


South African Markets – Factors to watch on Aug 5


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



<p>NAIROBI, Aug 5 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Monday.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Share markets tumbled and bonds rallied in Asia on Monday as fears the United States could be heading for recession sent investors rushing from risk assets while wagering interest rates will have to fall rapidly to rescue growth.</p>



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



<p>Oil prices hovered at eight-month lows on Monday as fears of a recession in the United States, the world&#8217;s top oil consumer, offset concerns that escalating tensions in the Middle East may affect supplies from the largest producing region.</p>



<p>The South African rand firmed on Friday as U.S. economic data showed a slowdown in jobs growth in July and a rise in the unemployment rate, boosting bets of a September rate cut in the world&#8217;s biggest economy and pressuring the dollar.</p>



<h2 class="wp-block-heading" id="h-nigeria-politics">NIGERIA POLITICS</h2>



<p>Nigeria&#8217;s President Bola Tinubu called on Sunday for a suspension of protests against a cost of living crisis, saying this would create an opportunity for dialogue, his first public comments since frustrated citizens took to the streets last week.</p>



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



<p>Kenya&#8217;s shilling slipped on Friday due to dollar demand from the manufacturing sector, traders said, adding that a credit rating review by S&amp;P Global later this month could be a big driver in the weeks ahead.</p>



<h2 class="wp-block-heading" id="h-kenya-ratings">KENYA RATINGS</h2>



<p>Global credit ratings agency Fitch downgraded Kenya&#8217;s sovereign rating to &#8220;B-&#8221; from &#8220;B&#8221; on Friday, citing heightened risks to the East African country&#8217;s public finances after the government backtracked on key revenue measures following protests.</p>



<h2 class="wp-block-heading" id="h-kenya-economy">KENYA ECONOMY</h2>



<p>Kenya&#8217;s finance minister nominee on Saturday defended the International Monetary Fund&#8217;s role in supporting the economy for now, but said the country should become more self-reliant by cutting its budget deficit and shifting to cheaper debt.</p>



<h2 class="wp-block-heading" id="h-ethiopia-debt">ETHIOPIA DEBT</h2>



<p>Ethiopia will save $4.9 billion from its debt restructuring exercise, State Finance Minister Eyob Tekalign said on Friday.</p>



<p>((Compiled by Nairobi Newsroom))</p>


African Markets – Factors to watch on Aug 5


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="960" height="730" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx.jpeg" alt="" class="wp-image-515252" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx.jpeg 960w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx-300x228.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx-820x624.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx-118x90.jpeg 118w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015858-1722630576753-gettyimages-2165010509-ms1_7647_t8akammx-768x584.jpeg 768w" sizes="(max-width: 960px) 100vw, 960px" /><figcaption class="wp-element-caption">Stock market numbers are displayed on a screen at the New York Stock Exchange during afternoon trading on August 02, 2024 in New York City.<br>Michael M. Santiago | Getty Images</figcaption></figure>



<p>LONDON — European stocks fell sharply at the start of the Monday session, as global volatility continues amid concerns of a looming U.S. recession.</p>



<p>The regional Stoxx 600 index was 2.77% lower by 8:19 a.m. London time, with all sectors and major regional bourses trading in the red. Tech stocks led losses, shedding as much as 5% before paring losses slightly to trade down 4.7%, while banks were 3.7% lower.</p>



<p>The lower start for major European markets comes amid wider global volatility; U.S. stock futures fell Sunday night following a turbulent last week for Wall Street, in which the Nasdaq Composite dropped into correction territory. Asia-Pacific markets also continued the selloff overnight.</p>



<p>Earnings in Europe come from Uniper, Infineon, Monte dei Paschi and Palantir Technologies on Monday. Data releases include services purchasing managers’ index data from the U.K, Italy and Spain.</p>


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European markets plunge 2.7% as global volatility deepens; tech stocks shed 4.7%


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="884" height="442" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy.jpg" alt="" class="wp-image-514258" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy.jpg 884w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy-300x150.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy-820x410.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy-160x80.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015047-1722527876434-108015047-1722527728357-gettyimages-2159383304-jr029159_ghjrzhsy-768x384.jpg 768w" sizes="(max-width: 884px) 100vw, 884px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



<p>Job growth in the U.S. slowed much more than expected during July and the unemployment rate ticked higher, fueling fears of a broader economic slowdown, the Labor Department reported Friday.</p>



<p>Nonfarm payrolls grew by just 114,000 for the month, down from the downwardly revised 179,000 in June and below the Dow Jones estimate for 185,000. The unemployment rate edged higher to 4.3%, its highest since October 2021.</p>



<p>Average hourly earnings, a closely watched inflation barometer, increased 0.2% for the month and 3.6% from a year ago. Both figures were below respective forecasts for 0.3% and 3.7%.</p>



<p>Stock market futures added to losses following the report while Treasury yields plunged.</p>



<p>The labor market had been a pillar of economic strength but has recently shown some trouble signs, and the July payrolls increase was well below the average of 215,000 over the past 12 months.</p>



<p>“Temperatures might be hot around the country, but there’s no summer heatwave for the job market,” said Becky Frankiewicz, president of the ManpowerGroup employment agency. “With across-the-board cooling, we have lost most of the gains we saw from the first quarter of the year.”</p>



<p>From a sector standpoint, health care again led in job creation, adding 55,000 to payrolls. Other notable gainers included construction (25,000), government (17,000), and transportation and warehousing (14,000). Leisure and hospitality, another leading gainer over the past few years, added 23,000.</p>



<p>The information services sector posted a loss of 20,000.</p>



<p>While the survey of establishments used for the headline payrolls number was discouraging, the household survey was even more so, with growth of just 67,000, while the ranks of the unemployed swelled by 352,000. The participation rate as a share of the working-age population edged higher to 62.7%.</p>



<p>The report adds to mixed signals recently about the economy and with financial markets on edge about how the Federal Reserve will respond.</p>



<p>Though markets on Wednesday cheered indications from the Fed that an interest rate cut could come as soon as September, that quickly turned to trepidation when economic data Thursday showed an unexpected jump in filings for unemployment benefits and a further weakening of the manufacturing sector.</p>



<p>That triggered the worst sell-off of the year on Wall Street and renewed fears that the Fed may be waiting too long to start cutting interest rates.&nbsp;Easing wage gains could help policymakers feel more confident that inflation is progressing back to their 2% goal.</p>



<p>The rise in the unemployment rate brings into play the so-called Sahm Rule, which states that the economy is in recession when the three-month average of the jobless level is half a percentage point higher than the 12-month low. In this case, the unemployment rate was 3.5% in July 2023 before it began its gradual ascent. The three-month unemployment rate average moved up to 4.13%.</p>



<p>“The latest snapshot of the labor market is consistent with a slowdown, not necessarily a recession,” said Jeffrey Roach, chief economist at LPL Financial. “However, early warning signs suggest further weakness.”</p>



<p>Roach pointed out that the ranks of those working part-time for economic reasons jumped to 4.57 million, an increase of 346,000 to the highest level since June 2021.</p>



<p>An alternate measure of unemployment that includes discouraged workers and those holding part-time jobs for economic reasons surged 0.4 percentage point to 7.8%, the highest since October 2021.</p>



<p>Long-term unemployment also ticked higher. Those reporting being out of work for 27 weeks or more totaled 1.54 million, the most since February 2022.</p>



<p>Wall Street had been bracing for modest gains from the July payrolls report, in part over concerns about growth but also from residual impacts from Hurricane Beryl. The storm badly damaged parts of Texas including the Houston metropolitan area.&nbsp;</p>



<p>Despite some anxiety over the state of economic growth, Fed Chair Jerome Powell on Wednesday expressed confidence about the “solid” economy and said easing inflation data is raising confidence that the central bank can cut soon.&nbsp;</p>



<p>Markets have fully priced in a rate cut of at least a quarter percentage point at each of the three remaining Fed meetings this year. Odds are rising that the Fed even may go beyond traditional quarter point reductions.</p>



<p>“While the labor market has remained remarkably resilient over these past two years of elevated interest rates, it’s important for the Federal Reserve to stay ahead of any further labor market slowing by proceeding with its expected September rate cut,” said Clark Bellin, chief investment officer at Bellwether Wealth.</p>



<p><em>Correction: The forecast for average hourly earnings was for an increase of 0.3% for the month. An earlier version misstated the percentage.</em></p>


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U.S. jobs growth totals 114,000 in July, much less than expected, as unemployment rate rises to 4.3%


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1254" height="836" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/05/Stock-value-rising-and-falling.jpg" alt="" class="wp-image-404443" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/05/Stock-value-rising-and-falling.jpg 1254w, https://cms.cnbcafrica.com/wp-content/uploads/2021/05/Stock-value-rising-and-falling-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/05/Stock-value-rising-and-falling-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/05/Stock-value-rising-and-falling-768x512.jpg 768w" sizes="(max-width: 1254px) 100vw, 1254px" /><figcaption class="wp-element-caption">Macro view of a screen of trading terminal with abstract financial graph and digits. Trading and forex concept. 3D Rendering</figcaption></figure>



<p>Aug 2 (Reuters) &#8211; Emerging markets stocks slumped on Friday, tracking broader global risk-off sentiment as investors rushed for safe-haven assets amid worries about a U.S. economic slowdown.</p>



<p>MSCI&#8217;s index of emerging market stocks slumped 2.2%, set to clock its worst day in one year if losses hold, while an index of EM currencies was flat.</p>



<p>An initial boost to risk assets following the Federal Reserve&#8217;s meeting on Wednesday quickly gave way to concerns over global growth, after a weak U.S. ISM manufacturing report that followed further signs of economic slowdown in China.</p>



<p>&#8220;When China coughs, the world can catch a cold &#8230; emerging markets would be exposed here if risk sentiment were to sour further,&#8221; said Harry Mills, director at Oku Markets.</p>



<p>Some currencies in emerging Europe fared slightly better against a weaker dollar as investors turned to the safe haven Japanese yen and Swiss franc.</p>



<p>The Czech crown and Hungarian forint were up about 0.1% against the dollar, while the Polish zloty jumped 0.4% after falling in the previous session. The zloty gained 0.3% against the euro.</p>



<p>Both the Turkish lira and Indian rupee touched record lows against the greenback, while the Russian rouble slipped about 0.4%.</p>



<p>Focus now shifts to U.S. nonfarm payrolls data for July later in the day, where forecasts are for employment in the world&#8217;s largest economy to increase by 175,000.</p>



<p>&#8220;Investor confidence in the growth outlook may breathe a sigh of relief today should the payrolls number surprise to the upside, though, it&#8217;s a fight between investor sentiment and safety versus bets on Fed rate cuts,&#8221; Mills said.</p>



<p>Investors also grappled with rising geopolitical tensions, after the Israeli military said on Thursday that the head of Hamas&#8217; military wing, Mohammed Deif, was killed, a day after group leader Ismail Haniyeh was killed in Tehran.</p>



<p>Bourses in Turkey, Prague and Warsaw slumped between 0.7% and 1.7%, following emerging Asian equities that were also broadly lower.</p>



<p>Indexes in Taipei and Seoul led declines as a selloff in U.S. tech stocks and disappointing results from Intel weighed on the tech sector.</p>



<p>MSCI&#8217;s EM stock index was on track to fall for a third straight week, however, the currency index was set to rise about 0.3% in its best week since mid-May.</p>



<p>EM debt-focused funds saw outflows of $0.2 billion over the past week, according to data from Bank of America Global Research, though EM equity funds have seen about $4.5 billion in inflows over the past nine weeks.</p>



<p>Elsewhere, Ethiopia&#8217;s Prime Minister Abiy Ahmed defended the country&#8217;s decision to float its birr currency this week, a move which helped the country secure financing from both the International Monetary Fund and the World Bank.</p>



<p>However, the birr has slumped nearly 40% against the dollar since then.</p>



<p>(Reporting by Lisa Mattackal in Bengaluru; Editing by Conor Humphries)</p>


Risk-off mood hits EM assets ahead of U.S. payrolls data


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1367" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-scaled.jpg" alt="" class="wp-image-505639" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-768x513.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1161864863-1536x1025.jpg 1536w" sizes="(max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A South African one rand coin sits on South African rand banknotes in this arranged photograph in Pretoria, South Africa, on Wednesday, Aug. 14, 2019. The rand ended a tumultuous week on a positive note, gaining against the dollar for a second day and heading for its first weekly advance in four as technical indicators suggested recent declines are overdone. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



<p>JOHANNESBURG, Aug 2 (Reuters)&nbsp;&#8211;&nbsp;The South African rand was stronger in early trade on Friday, helped by signs of improvement in the domestic economy and dollar weakness on global markets.</p>



<p>The rand traded at 18.2275 against the dollar at 0635 GMT, up about 0.3% from Thursday&#8217;s close.</p>



<p>The dollar was down about 0.1% against a basket of currencies after an unexpected slump in U.S. manufacturing raised fears of an economic downturn.</p>



<p>South African data on Thursday showed electricity generation increased 5.4% year on year in June. A purchasing managers&#8217; index survey for the manufacturing sector, meanwhile, showed a sharp rebound in July.</p>



<p>&#8220;Structural improvements in the South African economy should continue to support the rand,&#8221; Commerzbank analyst Volkmar Baur said in a research note.</p>



<p>Later on Friday South Africa&#8217;s government will auction 1 billion rand ($54.9 million) of inflation-linked bonds.</p>



<p>($1 = 18.2188 rand)</p>



<p>(Reporting by Alexander Winning; Editing by David Goodman)</p>


South African rand gains on domestic economy while dollar dips


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="408" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg" alt="" class="wp-image-400697" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1-300x200.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Double exposure of coin stack with city background and world map, financial graph, world map and global network business concept idea, element by NASA.</figcaption></figure>



<p>JOHANNESBURG, Aug 2 (Reuters)&nbsp;&#8211;&nbsp;The following political and economic events, and equity and currency market moves may affect South African markets on Friday.</p>



<h2 class="wp-block-heading" id="h-political-and-economic-events">POLITICAL AND ECONOMIC EVENTS</h2>



<p>African National Congress National Executive Committee meets</p>



<p>Inflation-linked bond auction</p>



<h2 class="wp-block-heading" id="h-south-african-markets">SOUTH AFRICAN MARKETS</h2>



<p>South Africa&#8217;s rand firmed on Thursday as investors bet on a September interest rate cut in the world&#8217;s biggest economy after dovish comments by the U.S. Federal Reserve on Wednesday.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Asian shares were headed for their worst day in over two years and U.S. Treasury yields slid, while the Swiss franc and yen rose on safety bids on Friday after weaker-than-expected U.S. factory data sparked fears of a worsening economic outlook.</p>



<h2 class="wp-block-heading" id="h-wall-street">WALL STREET</h2>



<p>U.S. stocks kicked off August sharply lower after a round of economic data on Thursday spurred concerns the economy may be slowing faster than anticipated while the Federal Reserve maintains a restrictive monetary policy.</p>



<h2 class="wp-block-heading" id="h-gold">GOLD</h2>



<p>Gold prices firmed on Friday and were poised for a weekly gain, steered by safe-haven demand and the prospect of a September rate cut by the Federal Reserve, while market participants awaited U.S. payrolls data. </p>



<p>&#8211; &#8211; &#8211; &#8211;</p>



<p>Some of the main stories out in the South African press:</p>



<h2 class="wp-block-heading" id="h-business-day">BUSINESS DAY</h2>



<p>&#8211; Lift in manufacturing bodes well for third-quarter economic performance</p>



<p>&#8211; Post-election cheer helps lift vehicle sales in July</p>



<h2 class="wp-block-heading" id="h-fin-24">FIN 24</h2>



<p>&#8211; Treasury punishes Eskom with 4 bln rand for poor behaviour</p>



<p>(Compiled by Alexander Winning)</p>


South African Markets – Factors to watch on Aug 2


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="(max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



<p>NAIROBI, Aug 2 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Friday.</p>



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



<p>Asian shares and U.S. Treasury yields slid while the Swiss franc and yen rose on safety bids on Friday after weaker-than-expected U.S. factory data sparked fears of a worsening economic outlook.</p>



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



<p>Oil prices rose on Friday but were set for a fourth successive weekly decline, as signs of disappointing global fuel demand growth outweighed fears of supply disruptions.</p>



<h2 class="wp-block-heading" id="h-south-africa-markets">SOUTH AFRICA MARKETS</h2>



<p>South Africa&#8217;s rand firmed on Thursday as investors bet on a September interest rate cut in the world&#8217;s biggest economy after dovish comments by the U.S. Federal Reserve on Wednesday.</p>



<h2 class="wp-block-heading" id="h-africa-currencies">AFRICA CURRENCIES</h2>



<p>Kenya&#8217;s shilling is expected to be stable in the next week to Thursday, while Ghana&#8217;s cedi and Uganda&#8217;s shilling could weaken and Zambia&#8217;s kwacha could gain, traders said.</p>



<h2 class="wp-block-heading" id="h-nigeria-electricity">NIGERIA ELECTRICITY</h2>



<p>African Development Bank has approved a loan of $500 million for Nigeria to boost its electricity sector, the bank said on Thursday.</p>



<h2 class="wp-block-heading" id="h-nigeria-politics">NIGERIA POLITICS</h2>



<p>At least three protesters were killed in Nigeria&#8217;s Kaduna state on Thursday, Reuters reporters and eyewitnesses said, as demonstrators rallied across the West African nation against rising cost of living and governance issues.</p>



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



<p>The Kenyan shilling dipped against the US dollar on Thursday, according to data from the London Stock Exchange Group (LSEG).</p>



<h2 class="wp-block-heading" id="h-tanzania-railway">TANZANIA RAILWAY</h2>



<p>Tanzania on Thursday launched a 541-km modern standard gauge railway running between its administrative and commercial capitals, built by a Turkish firm as part of a government drive to improve transport infrastructure.</p>



<h2 class="wp-block-heading" id="h-ethiopia-economy">ETHIOPIA ECONOMY</h2>



<p>At least two Ethiopian local governments have ordered the closure of dozens of businesses found hiking prices of basic commodities after the central bank floated the national currency, officials said on Thursday.</p>



<h2 class="wp-block-heading" id="h-togo-politics">TOGO POLITICS</h2>



<p>Togo&#8217;s President Faure Gnassingbe has retained Victoire Sidemeho Tomegah-Dogbe as prime minister and a government will be formed in the coming days in line with a new constitution, the presidency said on Thursday.</p>



<h2 class="wp-block-heading" id="h-zambia-electricity">ZAMBIA ELECTRICITY</h2>



<p>Zambia&#8217;s state-owned power utility ZESCO has agreed to buy 218 megawatts (MW) of electricity from South Africa and Zimbabwe to cushion a shortfall caused by reduced hydropower capacity, its energy minister said on Thursday.</p>



<h2 class="wp-block-heading" id="h-botswana-diamonds">BOTSWANA DIAMONDS</h2>



<p>Sales of rough diamonds at Debswana Diamond Company fell 49.2% in the first half of 2024, according to data released by the Botswana central bank late on Wednesday, as the downturn in the global diamond market continued.</p>



<p>((Compiled by Nairobi Newsroom))</p>


African Markets – Factors to watch on Aug 2


<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou-820x462.jpeg" alt="" class="wp-image-514095" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">People line up as they wait for the JobNewsUSA.com South Florida Job Fair to open at the Amerant Bank Arena on June 26, 2024, in Sunrise, Florida. <br>Joe Raedle | Getty Images</figcaption></figure>



<p>The U.S. labor market may have cooled some in July, as a gradual slowdown in the economy and Hurricane Beryl are expected to have taken some of the steam out of hiring.</p>



<p>Still, even if the Labor Department’s nonfarm payrolls report for July, to be released Friday at 8:30 a.m. ET, does indicate a weaker jobs picture, the decline is expected to be only incremental and in keeping with the type of gentle downshift the Federal Reserve is looking to engineer.</p>



<p>“If the Fed was going to manufacture the soft landing, this is probably what it was going to look like,” said Mike Reynolds, vice president of investment strategy at Glenmede. “You’re seeing just modest on-the-margin weakness in the labor market that [isn’t likely to] spiral out of control into a negative feedback loop.”</p>



<p>Indeed, the report from the department’s Bureau of Labor Statistics is forecast to show payroll gains of 185,000 on the month, down from 206,000 in June, with the unemployment rate holding at 4.1%, according to the Dow Jones consensus estimate. Job reports for the past year and a half have routinely beaten the consensus.</p>



<p>But some economists think the report could be on the light side; Goldman Sachs expects Beryl, which ravaged large parts of Texas, particularly Houston, to pull down the jobs number by 15,000. The firm thinks the total payroll gain will be more like 165,000. Citigroup projects an even lower number — 150,000 on payrolls and a tick higher in the unemployment rate to 4.2%.</p>



<p>Should the unemployment rate keep climbing, it could raise fears that the so-called Sahm Rule is in danger of being triggered. The rule has observed without fail that when the unemployment rate over a three-month period averages half a percentage point higher than the 12-month low, the economy is in recession. A year ago, the jobless level as at 3.5% before it started climbing.</p>



<h2 class="wp-block-heading" id="h-optimism-at-the-fed">Optimism at the Fed</h2>



<p>Job gains have averaged 203,000 a month for the first half of 2024, while the unemployment rate has drifted higher as more workers have come into the labor force and the level of those considered unemployed but looking for work or temporarily laid off has hit its highest level since October 2021.</p>



<p>Fed Chair Jerome Powell on Wednesday noted that the previous disparity between supply and demand in the labor market has come into near-balance. Open jobs now outnumber available workers just 1.2 to 1, down from 2 to 1 a few years ago as inflation roared.</p>



<p>Should the factors continue to come into balance and other inflation indicators show progress, Powell strongly hinted that an interest rate cut could be coming in September.</p>



<p>“Our confidence is growing, because we’re getting good data,” he said at a news conference following the Fed’s policy meeting. “Frankly, the softening in the labor market conditions gives you more confidence that the economy’s not overheating.”</p>



<p>Markets will be watching Friday’s numbers for confirmation that Powell’s view on the labor market is accurate — and that the Fed isn’t overconfident and waiting too long to start lowering rates.</p>



<p>There has been a growing chorus on Wall Street for the Fed to start easing now that most indicators show that the inflation rate is only a short distance from the central bank’s 2% goal. DoubleLine CEO Jeffrey Gundlach, for instance, told CNBC on Wednesday that he thinks the economy already is teetering on recession.</p>



<p>“When we look back at today, …. I kind of believe that we will say that we were in recession in September 2024,” he said.</p>



<h2 class="wp-block-heading"><a></a>Eyes on earnings</h2>



<p>The Fed at its meeting voted to hold its benchmark overnight borrowing rate in a range of 5.25%-5.5%, where it has been for the past year.</p>



<p>Markets rallied on the news but gave back those gains Thursday following news that unemployment claims rose last week and the manufacturing sector slumped further into contraction.</p>



<p>“By holding off on cutting interest rates today, the Federal Open Market Committee is betting the labor market is strong enough to wait until the fall for confirmation that inflation is returning to 2%,” said Nick Bunker, Indeed Hiring Lab’s economic research director for North America. “Let’s hope it pays off.”</p>



<p>As always, markets also will have eyes on the average hourly earnings portion of the report for signs of underlying inflation.</p>



<p>The forecast is that earnings rose 0.3% on the month and 3.7% from year ago. If the latter is correct, it will represent the lowest earnings increase since May 2021.</p>



<p>“Even if wage pressures were to unexpectedly remain ‘stuck’ or slightly re-accelerate in this report, we think that the progress the Fed has made on inflation thus far means that there should still be an opportunity for the Fed to cut rates in September so long as subsequent data releases (eg July CPI) cooperates,” said BeiChen Lin, investment strategist at Russell Investments.</p>


107433735-1719423521960-gettyimages-2159383303-jr029067_kd08rrou

Here’s everything you need to know about Friday’s big jobs report


<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="747" height="467" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/stock-market.jpg" alt="" class="wp-image-401907" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/stock-market.jpg 747w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/stock-market-300x188.jpg 300w" sizes="(max-width: 747px) 100vw, 747px" /><figcaption class="wp-element-caption">Trading board is showing a crash in stock exchange market. Selective focus. Horizontal composition with copy space.</figcaption></figure>



<p>Aug 1 (Reuters) &#8211; Emerging market stocks rose on Thursday after the Federal Reserve signalled it could start easing policy in September, while currencies across emerging Europe slipped amid weak manufacturing data for several economies.</p>



<p>In focus, the Czech crown lost 0.3% against the euro ahead of an expected 25 basis point (bps) rate reduction from the country&#8217;s central bank, slowing the pace of easing after four 50 bps cuts.</p>



<p>&#8220;We expect a hawkish outcome from today&#8217;s meeting &#8230; CZK has moved back above 25.400 EUR/CZK under the pressure of aggressive dovish pricing in recent days,&#8221; said Frantisek Taborsky, EMEA forex and fixed income strategist at ING.</p>



<p>&#8220;In our view, the CZK has decent potential to rally from these levels.&#8221;</p>



<p>MSCI&#8217;s index of emerging market stocks rose 0.4%, tracking gains in global equities after Wednesday&#8217;s signal from Fed Chairman Jerome Powell that the central bank could start easing rates in September if U.S. economic data continues on its current trajectory.</p>



<p>Lower borrowing costs in the U.S. typically weaken the dollar and lift the appeal of emerging market assets.</p>



<p>However, the dollar regained some ground after slipping for two straight sessions, with most currencies in emerging European economies weakening against the greenback.</p>



<p>Weaker manufacturing data also weighed, with the Hungarian forint losing 0.6% versus the euro, after manufacturing activity remained in contraction territory.</p>



<p>The Polish zloty dipped 0.2% against the euro, after S&amp;P Global&#8217;s Purchasing Managers&#8217; Index showed its manufacturing sector slowed its decline in July, but was still in contraction.</p>



<p>Ukraine was also in focus after it temporarily suspended international debt payments as it finalises a restructuring plan to slash $20 billion of international debt. However, the move is unlikely to trigger much concern in debt markets.</p>



<p>A bond maturing in 2026 rose about 1.5 cents on the dollar, while a bond that provides additional payments when the country&#8217;s economy grows was little changed.</p>



<p>MSCI&#8217;s International Emerging Markets Currency Index edged 0.1% higher after briefly touching its highest since mid-July.</p>



<p>Russia&#8217;s rouble strengthened 0.5% against the dollar, as worries about rising conflict in the Middle East lifted the price of oil, one of its main exports.</p>



<p>In equities, Turkish stocks jumped 1.7%, led by a 3.6% rise in its bank index.</p>



<p>Manufacturing in Turkey contracting for a fourth straight month, data showed.</p>



<p>Meanwhile, Nigerian security forces were deployed in major cities, while the government said it was open to dialogue ahead of planned protests against a cost of living crisis.</p>



<p>Weaker PMI data also weighed on Chinese shares, with a slump in its manufacturing activity leading generally weak readings across Asia&#8217;s factories in June.</p>



<p>(Reporting by Lisa Mattackal in Bengaluru; editing by Giles Elgood)</p>


Trading Board Is Showing A Crash In Stok Exchange Market

Dovish Fed lifts stocks while FX slips; Czech rate decision eyed


<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-820x547.jpeg" alt="" class="wp-image-513752" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107375514-1708434236970-gettyimages-1985552002-20240207_bank_of_england_010-scaled.jpeg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Blurred buses pass the Bank of England in the City of London on 7th February 2024 in London, United Kingdom. <br>Mike Kemp | In Pictures | Getty Images</figcaption></figure>



<p>LONDON — Several analysts expect the Bank of England to announce an interest rate cut on Thursday, but a lack of clear signaling from the central bank has shrouded the decision in uncertainty.</p>



<p>Markets were pricing in a 61% probability of a 25-basis-point reduction of its key rate at the August meeting as of 8:15 a.m. in London, despite U.K. inflation hitting the BOE’s 2% target for two straight months.</p>



<p>The Bank Rate has been held at a 16-year high of 5.25% since August 2023.</p>



<p>The BOE typically provides less forward guidance than some other central banks, but the Thursday decision is viewed as an especially close call, given the recent six-week period in which its communications were restricted because of the U.K. general election.</p>



<p>While recent breakdowns have seen two votes for a rate cut and seven for a hold, some of the BOE’s more hawkish policymakers have been vocal about their concerns over wage growth and sticky services inflation.</p>



<p>The decision will be announced at midday U.K. time and will be followed by a press conference. Thursday will also see the release of the quarterly Monetary Policy Report, which will contain economic growth and inflation projections.</p>



<p>This is a developing story&#8230;</p>


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Economy

EM stocks recover after bruising selloff, dollar recovery weighs on currencies

South African rand claws back losses as risk sentiment improves

South African Markets – Factors to watch on Aug 6

African Markets – Factors to watch on Aug 6

South African rand, stocks sink as US recession fears hit riskier assets

South Africa business activity contracts again in July, PMI shows

South African Markets – Factors to watch on Aug 5

African Markets – Factors to watch on Aug 5

European markets plunge 2.7% as global volatility deepens; tech stocks shed 4.7%

U.S. jobs growth totals 114,000 in July, much less than expected, as unemployment rate rises to 4.3%

Risk-off mood hits EM assets ahead of U.S. payrolls data

South African rand gains on domestic economy while dollar dips

South African Markets – Factors to watch on Aug 2

African Markets – Factors to watch on Aug 2

Here’s everything you need to know about Friday’s big jobs report

Dovish Fed lifts stocks while FX slips; Czech rate decision eyed

Bank of England to make knife-edge call on interest rates as markets favor cut

News Tips

Advertise With Us

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