<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="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



NAIROBI, Aug 7 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Wednesday.



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



*Uganda&#8217;s central bank is due to announce its latest benchmark lending rate decision.



*Kenya&#8217;s central bank governor is due to hold a news conference, a day after the bank announced its latest lending rate decision.



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



Asian share markets extended their rally on Wednesday, led by another bounce in the Nikkei, as the Bank of Japan unexpectedly turned cautious on rate hikes amidst market volatility, which led to a sharp fall in the yen.



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



Oil prices slipped in early Asian trading on Wednesday following a brief rebound in the previous session after industry data showed an unexpected build in U.S. crude oil and gasoline inventories, offsetting global oil supply concerns.



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



The South African rand held steady on Tuesday as global risk sentiment improved after tanking on Monday amid fears of a possible recession in the United States.



<h2 class="wp-block-heading" id="h-nigeria-petroleum">NIGERIA PETROLEUM</h2>



Nigeria&#8217;s oil output has risen to between 1.6 million and 1.7 million barrels per day after the government beefed up security to curb crude theft, Chief of Naval Staff Emmanuel Ikechukwu Ogalla said on Tuesday.



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



Kenya&#8217;s shilling eased slightly on Tuesday, and traders said it was expected to hold steady during the session, with dollar demand from various sectors being matched by supply.



<h2 class="wp-block-heading" id="h-kenya-central-bank-rate">KENYA CENTRAL BANK RATE</h2>



Kenya&#8217;s central bank cut its benchmark lending rate by 25 basis points on Tuesday, saying there was scope to ease policy gradually as inflation had fallen below the midpoint of its target range.



<h2 class="wp-block-heading" id="h-ethiopia-forex">ETHIOPIA FOREX</h2>



Ethiopia&#8217;s central bank said on Tuesday that it would conduct a special foreign exchange auction on Aug. 7.



((Compiled by Nairobi Newsroom))

World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on Aug 7

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1374" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-scaled.jpg" alt="" class="wp-image-516063" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-300x201.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-820x550.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-134x90.jpg 134w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-768x515.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/H7HVUG7OLJM7TMXBKROUDBYZ3E-1536x1031.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: South Africa&#8217;s President Cyril Ramaphosa gestures after signing into law a national health bill that aims to provide universal coverage to South Africans, at the Union Building in Pretoria, South Africa, May 15, 2024. REUTERS/Siphiwe Sibeko/File Photo</figcaption></figure>



JOHANNESBURG, Aug 7 (Reuters)&nbsp;&#8211;&nbsp;South Africa is moving ahead with implementation of the National Health Insurance (NHI) bill, President Cyril Ramaphosa said, despite strong opposition from within and outside government.



The NHI aims to provide universal coverage through a major overhaul of South Africa&#8217;s two-tier system. Ramaphosa signed the bill right before the May election in which his African National Congress lost its parliamentary majority.



&#8220;We have highlighted the social and economic value of affordable, accessible, quality health care that is available equally to all South Africans,&#8221; Ramaphosa said in a speech on Tuesday evening, at the closing of an ANC policy meeting.



&#8220;We will therefore proceed with the implementation of the National Health Insurance.&#8221;



Speaking earlier on Tuesday, Health Minister Aaron Motsoaledi said that the section of the bill which outlines transitional mechanisms would be implemented &#8220;immediately&#8221;.



This includes setting up advisory committees and amending other health-related laws to be in line with the NHI.



The legislation will gradually limit the role of private insurance in South Africa, create a new public fund to provide free access for citizens, and set the fees and prices that private healthcare suppliers can charge for NHI-funded benefits.



Supporters call it a generational change to reverse inequality dating to the apartheid era. But opponents, including big local health insurers, say the proposed funding model won&#8217;t work.



Motsoaledi said he would listen to concerns from stakeholders and help people understand the NHI.



&#8220;The real poor people who are (set to be) beneficiaries haven&#8217;t spoken,&#8221; he said. &#8220;Nobody&#8217;s carrying their voice.&#8221;



One opponent of the bill is the pro-business Democratic Alliance (DA) party, which formerly led the opposition and has now joined the ANC in government.



DA leader John Steenhuisen said last month that the NHI continued to be a sticking point for the coalition government and that discussions on it would continue.



Motsoaledi said the bill would be implemented in phases over years and acknowledged that legal challenges could delay its roll-out.



(Reporting by Nellie Peyton; Editing by Kim Coghill)

South Africa’s Ramaphosa to signs health insurance bill into law

South Africa moves to implement national health bill despite resistance

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="929" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV.jpeg" alt="" class="wp-image-516045" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV.jpeg 929w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107193967-1676336822877-gettyimages-1240268939-AFP_32927KV-768x432.jpeg 768w" sizes="auto, (max-width: 929px) 100vw, 929px" /><figcaption class="wp-element-caption">The Japanese flag flutters over the Bank of Japan (BoJ) head office building (bottom) in Tokyo on April 27, 2022. Kazuhiro Nogi | Afp | Getty Images</figcaption></figure>



Bank of Japan Deputy&nbsp;Governor&nbsp;Shinichi Uchida said on Wednesday the central bank&nbsp;won’t&nbsp;raise&nbsp;interest&nbsp;rates&nbsp;when&nbsp;financial&nbsp;markets&nbsp;are&nbsp;unstable.



The recent strengthening of the yen would affect the&nbsp;BOJ’s policy decision because it reduces upward pressure on import prices, and therefore overall inflation, Uchida said.



Stock market volatility would also influence the central bank’s decision by affecting corporate activity and consumption, he said.



“As we’re seeing sharp volatility in domestic and overseas financial&nbsp;markets, it’s necessary to maintain current levels of monetary easing for the time being,” Uchida said in a speech to business leaders in the northern Japan city of Hakodate.



The&nbsp;BOJ’s interest rate path will “obviously” change if market volatility affects its economic and price outlook, its view on risks, and the likelihood of durably achieving its 2% inflation target, he said.



“We&nbsp;won’t&nbsp;raise&nbsp;interest&nbsp;rates&nbsp;when&nbsp;financial&nbsp;markets&nbsp;are&nbsp;unstable,” Uchida said.

107193967-1676336822877-gettyimages-1240268939-AFP_32927KV

Bank of Japan won’t raise rates when markets unstable, deputy governor says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="548" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-820x548.jpg" alt="" class="wp-image-515813" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-820x548.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-300x201.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-768x514.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-1536x1027.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/U7UJE54KWRKWNHMXF7IAKVVUWM-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Township residents carry bottles collected from a municipal water tanker in drought-stricken Graaff-Reinet, South Africa, November 17, 2019. Picture taken November 17, 2019. REUTERS/Mike Hutchings/File Photo</figcaption></figure>



HARARE, Aug 6 (Reuters) &#8211; The U.N. World Food Programme has faced challenges in raising $400 million for its southern Africa drought response, collecting just one-fifth of what it needs to help seven countries in the region, a WFP spokesperson said on Tuesday.



The funding environment had become increasingly difficult as&nbsp;drought has dramatically raised the region&#8217;s food needs, Thomson Phiri told Reuters.



Southern Africa is experiencing its worst drought in decades, forcing Zambia, Malawi and Zimbabwe to declare states of disaster. The drought was a result of the El Niño climate phenomenon,&nbsp;which can change world weather patterns, bring extreme seasonal temperatures, rainfall or dry spells and hurt crop yields.



About 70% of the Southern African population that relies on rain-fed agriculture had their harvests &#8220;wiped out&#8221; by lack of rains, Phiri told Reuters in May.



The WFP aims to&nbsp;use the proceeds raised so far to&nbsp;feed&nbsp;5.9 million out of 27&nbsp;million&nbsp;in the region who are food-insecure&nbsp;until the next harvest season in 2025, and had started sourcing white grain from Tanzania, South Africa and Latin America to feed regional communities.



Despite notable donor support, current food needs were &#8220;exceptionally high and outpacing available resources,&#8221; during a historical drought, Phiri said.



Some donors have had to trim their aid budgets and &#8220;people in places such as southern Africa are now facing&nbsp;a double whammy where they are reeling both from the historic drought and severe funding cuts,&#8221; he said.



The UN&#8217;s climate crisis coordinator for the El Niño response, Reena Ghelani, called for urgent action.



&#8220;We are very worried,&#8221; Ghelani told Reuters last week. &#8220;In fact we are seeing a sharp increase in the number of people going hungry.&#8221;



Ghelani warned of a prolonged dry spell and frequent droughts across the region in coming years as a result of climate change.



(Reporting by Nyasha Chingono; Editing by Tannur Anders and Bernadette Baum)

U7UJE54KWRKWNHMXF7IAKVVUWM

UN agency raises just 20% of needed southern Africa drought aid in tough funding environment

How Orange Juice Became More Expensive Than Ever

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="550" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-820x550.jpg" alt="" class="wp-image-515795" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-820x550.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-300x201.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-134x90.jpg 134w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-768x516.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-1536x1031.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/CXMYWJHKXNNW7EHIFVBPT2LDKE-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">An armoured military vehicle parks on a street, during anti-government demonstrations against bad governance and economic hardship, in Abuja, Nigeria August 5, 2024. REUTERS/Marvellous Durowaiye</figcaption></figure>



ABUJA, Aug 6 (Reuters)&nbsp;&#8211;&nbsp;Nigeria has detained some tailors for making Russian flags that were waved during anti-government protests this week in northern states, the state secret police said, in a move that underscores concerns about increased Russian activity in western Africa.



The Department of State Services (DSS) also said in a post on X that it had detained some of the tailors&#8217; &#8220;sponsors&#8221;, without elaborating. It said an investigation was ongoing. It did not say how many tailors or &#8220;sponsors&#8221; had been detained.



Nigeria&#8217;s Chief of Defence Staff, General Christopher Musa, described the brandishing of a foreign flag during anti-government protests as a &#8220;treasonable offence&#8221; after he held security talks with President Bola Tinubu on Monday.



&#8220;We have identified those (sponsoring them) and we are going to take serious action against that,&#8221; Musa told reporters, also without elaborating.



Hundreds of thousands of Nigerians have been protesting since Aug. 1 against Tinubu&#8217;s painful economic reforms that have seen a partial end to petrol and electricity subsidies, currency devaluation and inflation touching three-decade highs.



The protests have now ebbed after a deadly police crackdown.



In the northern states of Borno, Kaduna, Kano and Katsina, protesters were seen waving hundreds of Russian flags with some calling for a military takeover.



&#8220;We are waving the Russian flag because Tinubu&#8217;s government is not listening to us. Russian presidents always support African nations&#8217; development, unlike other nations,&#8221; Lawal Kodo, a 28-year old protester in Kano, told Reuters on Monday.



<h2 class="wp-block-heading" id="h-russia-not-involved">RUSSIA &#8216;NOT INVOLVED&#8217;</h2>



The Russian embassy in Nigeria denied any involvement.



&#8220;The Government of the Russian Federation as well as any Russian officials are not involved in these activities and do not coordinate them in any way,&#8221; the embassy said in a statement issued late on Monday.



The protests in Nigeria, Africa&#8217;s most populous country, come amid increased Western concerns over Russian security ties with the region, including countries such as Mali, Burkina Faso and Niger where military leaders have seized power in coups.



Security experts said many Nigerian protesters believe that the cost of living crisis is the result of reforms dictated to Tinubu by Western institutions such as the International Monetary Fund and the World Bank.



&#8220;The Russian flags that appeared during the protests in northern states, and the calls for a military coup, reflect discontent over the government&#8217;s policies rather than showcasing support for a Russia-backed military government,&#8221; said Mucahid Durmaz, Senior Analyst at Verisk Maplecroft, a global risk intelligence firm.



(Additional reporting by Ahmed Kingimi in Borno, Felix Onuah in Abuja and Garba Muhammad in Kaduna; Edited by Elisha Bala-Gbogbo and Gareth Jones)

Nigerians continue to protest against economic hardship

Nigeria detains tailors who made Russian flags for anti-government protests

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1600" height="900" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3.jpeg" alt="" class="wp-image-515777" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3.jpeg 1600w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3-1536x864.jpeg 1536w" sizes="auto, (max-width: 1600px) 100vw, 1600px" /><figcaption class="wp-element-caption">Pedestrians walk past a currency exchange shop in central Tokyo on April 17, 2024. Richard A. Brooks | Afp | Getty Images</figcaption></figure>



Rapid interest rate cuts from the Federal Reserve could make matters worse for the global “carry trade” unwind, according to economists at TS Lombard.



The warning comes as market participants seek to aggressively roll back on carry trades following a dramatic global sell-off in risk assets.



Carry trades refer to operations wherein an investor borrows in a currency with low interest rates, such as the Japanese yen, and reinvests the proceeds in higher-yielding assets elsewhere. The trading strategy has been hugely popular in recent years.



Stock markets in Europe were unsettled on Tuesday, paring earlier gains amid a faltering sense of relief.



An August stocks slump has been partly driven by weaker-than-expected U.S. economic data at the end of last week. The readings led investors to worry that the Federal Reserve may be behind the curve in cutting interest rates to fend off a recession.



“The natural reaction from the Fed to soft labour market data and fresh recession risks would be to cut rates and to do so relatively rapidly. But this would exacerbate any carry trade unwind,” economists at TS Lombard said in a research note published Monday.



“The US economy should trump all else, but it would make sense for central bankers to be cautious,” they added.



<h2 class="wp-block-heading" id="h-triple-whammy"><a></a>‘Triple whammy’</h2>



Led by Freya Beamish, economists at the investment strategy research firm said they hoped to see a coordinated message from the Bank of Japan and Fed to soothe market nerves.



“Then if the carry trade unwind really is a problem, we’d hope these central banks would take steps to introduce some form of quantity measures that would help prevent Japanese and other investors that have run on yen carry trades from having to sell assets, and facilitate the Fed cutting rates in due course without exacerbating financial fragilities,” economists at TS Lombard said.



A spokesperson for the Federal Reserve declined to comment when contacted by CNBC on Tuesday.



Traditional safe haven assets, such as the yen and Swiss franc, surged on Monday, fueling speculation that investors were seeking to quickly unload profitable carry trades to cover their losses elsewhere.



The Japanese currency has risen sharply against the U.S. dollar in recent weeks, trading at 145.07 per dollar at 1:10 p.m. London time on Tuesday. It marks a stark contrast from the run-up to the July 4th U.S. holiday, when the yen fell to 161.96 per dollar for the first time since December 1986.



Strategists at HSBC said there had essentially been a “triple whammy” of concerns in recent days, citing the unwind of carry trades, the monetization of artificial intelligence and the prospect of an imminent U.S. recession.



“We think it’s too early to buy just yet, but fundamentals are still broadly supportive,” HSBC strategists said in a research note published Tuesday.



“We think the biggest risk now is a self-feeding sell-off that would eventually prompt a recession, given negative wealth effects and tighter credit conditions,” they added.



<h2 class="wp-block-heading"><a></a>‘Reawakened with a vengeance’</h2>



Kit Juckes, chief foreign exchange strategist at Societe Generale, said in a recent research note that “the big carry unwind is underway.”



“You can’t unwind the biggest carry trade the world has ever seen without breaking a few heads. That is the impression markets give us this morning,” Juckes said on Monday.



Juckes flagged that the biggest foreign exchange market reaction was still one of “position reduction.” He said long positions against the Japanese yen for the Australian dollar, British pound, Norwegian krone and U.S. dollar were all being taken off.



A push below 140 a dollar for the Japanese yen in the near term “would be unsustainable given the impact on equities and inflation,” he added.



Economists at TS Lombard said Monday that global assets — from the U.S. to China — “look exposed.”



“Maturity mismatch in the external balance sheet, built up over years of BoJ excess accommodation, drove Japanese investors out of foreign assets as the curve flattened though the early part of the pandemic,” they continued.



“But monetary divergence since the Fed started raising rates then presented a new opportunity – the old carry trade reawakened with a vengeance.”



— CNBC’s Michael Bloom contributed to this report.

108015521-1722602037773-gettyimages-2147872842-AFP_34PM2M3

The popular ‘carry trade’ is unwinding — and economists fear Fed rate cuts could make matters worse

Japan’s quest for the most powerful microchip leads semiconductor revival

<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="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Stock market report. 3d illustration</figcaption></figure>



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.



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.



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



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.



&#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.



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.



&#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.



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



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.



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



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.



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



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.



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



(Reporting by Lisa Pauline Mattackal in Bengaluru; Editing by Christina Fincher)

Stock market report. 3d illustration

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

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1363" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-scaled.jpg" alt="" class="wp-image-515710" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-820x546.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-768x511.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/VC-profile-Image-1536x1022.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /></figure>



UJ also the number 1 university in South Africa and on the African continent



The University of Johannesburg (UJ) has consolidated its position among the leading institutions of higher learning in the world, soaring to its highest-ever position in global rankings. UJ secured a remarkable #36 position in the <a href="https://www.timeshighereducation.com/world-university-rankings/university-johannesburg">Times Higher Education (THE) Impact Rankings</a> released in June this year. This is quite a feat for a university, considering that this year’s rankings included 1,963 institutions, an increase of 372 from the previous year.&nbsp;The University’s standing in these global rankings marks a significant rise of 10 from its previous position of #46 in the 2023 edition.



Consistently leading as the top university in Africa and South Africa, UJ has also maintained its prestigious #1 spot on the continent and in the country. This achievement is for its exceptional contribution to poverty alleviation, securing the top position in Sustainable Development Goal (SDG) 1: No Poverty. Impressively, UJ now ranks #3 globally in this SDG category, highlighting its firm commitment to research and support initiatives aimed at assisting impoverished students and local communities.



This notable achievement highlights UJ&#8217;s dedication to addressing some of the world’s most critical challenges, including environmental sustainability, social inclusion, economic growth, and collaborative partnerships.



UJ’s performance across individual SDGs is commendable, achieving top 100 rankings in six SDGs:



#3 for SDG 1: No Poverty



#6 for SDG 8: Decent Work and Economic Growth



#13 for SDG 5: Gender Equality



#46 for SDG 10: Reduced Inequalities



#53 for SDG 4: Quality Education



#93 for SDG 2: Zero Hunger



Additionally, UJ’s rankings for other SDGs are as follows:



101-200 for SDG 7: Affordable and Clean Energy



101-200 for SDG 12: Responsible Consumption and Production



201-300 for SDG 9: Industry, Innovation and Infrastructure



201-300 for SDG 17: Partnerships for the Goals



301-400 for SDG 6: Clean Water and Sanitation



301-400 for SDG 16: Peace, Justice and Strong Institutions



401-600 for SDG 11: Sustainable Cities and Communities



401-600 for SDG 3: Good Health and Well-being



401-600 for SDG 13: Climate Action



Apart from its impressive showing in THE Impact Ranking, UJ has also continues its strong performance in the QS World University Rankings, maintaining its position among the top 350 globally. UJ is also recognised as the most improved African institution over the past five years. Earlier, THE Young University Rankings named UJ as the leading university in South Africa and Africa among institutions under 50 years old.



This recognition of UJ in the various global rankings&nbsp;highlights the University’s rapid growth and outstanding potential in the global academic arena. Despite its relatively short history of 20 years of existence, UJ has demonstrated exceptional progress, challenging well-established institutions, some of which have more than a century of legacy, says Letlhokwa George Mpedi, UJ Vice-Chancellor and Principal.



“The University remains steadfast in its commitment to addressing societal challenges through research and knowledge production. “Our progress is not just about numbers and figures; it’s all about the positive and lasting impact we have on our students and the broader society.”

VC profile Image

UJ soars to top its highest-ever position in the global university rankings

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg" alt="" class="wp-image-506011" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/HCVRNAVJRJMOJBUK4XOB7PEJGY.jpg 1200w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A teller serves a client with Kenya shilling notes at the cashier&#8217;s booth of a forex exchange bureau in Kenya&#8217;s capital Nairobi, April 20, 2016. REUTERS/Thomas Mukoya/File Photo</figcaption></figure>



NAIROBI, Aug 6 (Reuters) &#8211; Kenya&#8217;s shilling eased slightly on Tuesday, and traders said it was expected to hold steady during the session, with dollar demand from various sectors being matched by supply.



At 0730 GMT, commercial banks quoted the shilling at 129.50/130.50 per dollar, compared with Monday&#8217;s closing rate of 129.25/130.25.



(Reporting by George Obulutsa; Editing by Duncan Miriri)

Kenyan shilling eases slightly; expected to hold steady

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1394" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-scaled.jpg" alt="" class="wp-image-515686" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-300x204.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-820x558.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-132x90.jpg 132w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-768x523.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/6RYF2UQ3FZLS7NXFVWZYO5NC3Q-1536x1046.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: Customers perform transactions on Nedbank automated teller machine (ATM) at the Trade Route Mall, in Lenasia outside Johannesburg, South Africa, February 8, 2023. REUTERS/Siphiwe Sibeko</figcaption></figure>



JOHANNESBURG, Aug 6 (Reuters) &#8211; South Africa&#8217;s Nedbank Group reported an 8% rise in half-year profit on Tuesday, supported by lower impairment charges and solid growth in non-interest revenue (NIR).



Nedbank upwardly revised its full-year forecast for NIR and new Chief Executive Jason Quinn told Reuters the bank should benefit as South Africa&#8217;s new national unity government has spurred cautious optimism in financial markets and could see companies spending meaningfully again.



&#8220;The national agenda on infrastructure is clear and we are an infrastructure player,&#8221; Quinn, who became CEO in May, said in an interview. &#8220;Companies are geared to take on some projects and taking on some debt.&#8221;



Nedbank, South Africa&#8217;s fourth biggest bank by assets, said headline earnings rose to 7.9 billion rand ($427.2 million) in the six months ended June 30.



NIR increased by 7% to 14.4 billion rand, slightly ahead of the group&#8217;s full-year guidance of above mid-single-digit growth. This was thanks to good growth in commission and fees, a strong trading performance and higher equity investment income, the bank said.



Nedbank now expects NIR growth for 2024 to be in the upper-single digits, buoyed by ongoing corporate deals and the acquisition of fleet management business Eqstra.



CEO Quinn is betting on an improving South African economy as inflationary pressures ease and the central bank is expected to start cutting interest rates in September for the first time since July 2020.



In the first half of the year, Nedbank&#8217;s net interest income (NII) &#8211; the amount banks earn from loans minus what they pay on deposits &#8211; grew marginally by 2% to 20.8 billion rand, below initial management expectations of above mid-single digit growth.



For 2024, NII growth is now guided to be below mid-single digits.



Nedbank&#8217;s loan growth increased by 4% to 913 billion rand, with stronger growth expected in the second half &#8220;as lower interest rates and inflation start benefiting retail credit growth and as wholesale clients start drawing down on renewable energy deals,&#8221; the bank said.



&#8220;Our best case says credit extension could grow by 6%,&#8221; Quinn told Reuters.



The group&#8217;s credit impairment charge decreased by 12% to 4.7 billion rand. Its credit loss ratio &#8211; a measure of bad loans as a percentage of total loans &#8211; of 104 basis points remained elevated as household finances remained under pressure.



But it improved from the 121 basis points reported in the same first half of 2023.



($1 = 18.4912 rand)



(Reporting by Nqobile Dludla; Editing by Jacqueline Wong, Janane Venkatraman and Susan Fenton)

Customers perform transactions on Nedbank automated teller machine

Nedbank raises non-interest revenue growth guidance after sold first half

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1365" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-scaled.jpg" alt="" class="wp-image-515689" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/TOL6J7SJYRMGPNAZ74HRQWMU7U-1536x1024.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: The Mobius II first generation SUV by Kenyan car maker Mobius Motors is seen in the company&#8217;s show room in Nairobi, Kenya March 6, 2019. Picture taken March 6, 2019. REUTERS/Baz Ratner/File Photo</figcaption></figure>



NAIROBI, Aug 6 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s Mobius Motors, which started making rugged, low-priced SUVs designed for Africa&#8217;s roads a decade ago, has decided to stop operating due to financial challenges, a company statement and a shareholder source said on Tuesday.



Mobius, founded by a London-born investor who experienced the continent&#8217;s bumpy roads while working for a forestry company in Kenya, found tax hikes in the East African country meant its business model was no longer sustainable, the source at one of the company&#8217;s shareholders told Reuters.



&#8220;The business could not sustain itself. There were some challenges,&#8221; said the source, asking not to be named.



The owners considered moving production to a different country, but that option was rejected due to the logistical challenges of moving the existing assembly line from Nairobi, the shareholder added.



Mobius initially produced a boxy, no-frills SUV designed for the modest budgets of African consumers, going for 1.3 million Kenyan shillings, equivalent to about $13,000 at the time and roughly half the price of an imported second-hand SUV.



It later launched updated editions with extra features.



Mobius, whose investors include Britain&#8217;s Playfair Capital, was part of a push by investors and governments on the continent to create jobs by launching home-grown vehicle manufacturers. They included Uganda&#8217;s Kiira Motors, Ghana&#8217;s Kantanka and Nigeria-based Innoson Motors.



At the same time, global automakers such as Japan&#8217;s Toyota Motor Corp and Germany&#8217;s Volkswagen AG also boosted their investments in markets including Kenya and Rwanda to tap into growing economies and rising consumer demand.



They all, however, faced the same challenges: stiff competition from second-hand imports from abroad.



Creditors will meet on Aug. 15 to vote on the voluntary liquidation, the company &#8211; which was not listed &#8211; said in the statement that appeared in newspapers.



(Reporting by Duncan Miriri; Editing by Helen Popper)

FILE PHOTO: The Mobius II first generation SUV by Kenyan car maker Mobius Motors is seen in the company’s show room in Nairobi

Kenya’s Mobius, maker of rugged cars for African roads, calls it a day

<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="auto, (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>



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.



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



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.



&#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.



&#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.



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.



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.



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%.



(Reporting by Tannur Anders; Editing by Christina Fincher)

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="auto, (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>



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.



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



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



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



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.



AngloGold Ashanti will release first-half results.



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



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.



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



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



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.



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



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.



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



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



&#8211; &#8211; &#8211; &#8211;



Some of the main stories out in the South African press:



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



&#8211; Treasury eases tough-love approach to Transnet



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



(Compiled by Tannur Anders)

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="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



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.



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



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



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



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.



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



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.



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



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.



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



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.



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



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



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



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.



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



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.



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



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.



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



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.



((Compiled by Nairobi Newsroom))

African Markets – Factors to watch on Aug 6

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline-820x462.jpeg" alt="" class="wp-image-515647" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/107387062-17103533112022-03-12t000514z_565864485_rc2c0t9vvjxf_rtrmadp_0_ukraine-crisis-usa-gasoline.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A view of storage tanks and pipelines at the Shell Carson Distribution Complex, a distribution hub for petroleum products, in Carson, California, on March 11, 2022. Bing Guan | Reuters</figcaption></figure>



U.S. crude oil futures fell to a six-month low on Monday as equity markets sold off on fears the economy might be teetering on the brink of a recession.



West Texas Intermediate is now up roughly 2% for the year while Brent is now down marginally for 2024, after trading higher for months on geopolitical risk in the Middle East and forecasts that the oil market would tighten in the third quarter.



U.S. crude oil closed below $73 per barrel, the lowest settlement since Feb. 5.



“In times of crises all assets correlate,” Matt Smith, lead oil analyst for the Americas at Kpler, said of oil following equity markets lower. But geopolitical tensions in the Middle East and OPEC’s ongoing production cuts are providing a floor for crude prices, Smith said.



Here are Monday’s closing energy prices:



<ul class="wp-block-list">
<li>West Texas Intermediate&nbsp;September contract: $72.94 per barrel, down 58 cents, or 0.79%. Year to date, U.S. crude oil is up 1.8%.</li>



<li>Brent&nbsp;October contract: $76.30 per barrel, down 51 cents, or 0.66%. Year to date, the global benchmark has fallen about 1%.</li>



<li>RBOB Gasoline&nbsp;September contract:&nbsp;$2.33 per gallon, up more than 1 cent, or 0.69%. Year to date, gasoline is up 10.99%.</li>



<li>Natural Gas&nbsp;September contract: $1.94 per thousand cubic feet, down more than 2 cents, or 1.27%. Year to date, gas is down 22.75%.</li>
</ul>



The sell-off comes after U.S. job growth disappointed in July, with the unemployment rate rising to 4.3%, the highest level since October 2021. The U.S. manufacturing sector also contracted in July for the fourth consecutive month.



The weak economic data in the U.S. comes as lackluster demand in China had already been spooking traders.



“Already before we had the jobs report, already before the manufacturing data, we were concerned about weaker imports into China, weaker refinery utilization rates in China,” Helima Croft, head of global commodity strategy at RBC Capital Markets, said on CNBC’s “Squawk Box” on Monday.



<h2 class="wp-block-heading" id="h-opec-plans-face-challenges">OPEC plans face challenges</h2>



OPEC+ is also expected to start increasing production in October, though the group indicated last week that this decision “could be paused or reversed, depending on prevailing market conditions.” Croft said OPEC+ is now unlikely to start ramping up production.



“If the trend continues, I just can’t imagine OPEC would go forward with increasing output into this market. The question is, would they go the opposite way given the conditions we’re seeing,” Croft said, suggesting the oil producers could cut production again.



Bob Yawger, executive director of energy futures at Mizuho Securities, said OPEC+ seems interested in moving forward with the production increase based on last week’s statement, but they may not be able to afford to do so at this point. Rolling oil bank onto the market at current prices would “tank” the market, Yawger said.



<h2 class="wp-block-heading" id="h-geopolitical-risk"><a></a>Geopolitical risk</h2>



Geopolitical risk remains present with Israel preparing for an attack from Iran after the assassination of Hamas leader Ismail Haniyeh in Tehran last week.



“That exchange of fire in April between Iran and Israel was relatively contained, did not lead to any market disruptions,” Croft said. “But the question is now are we looking at something more coordinated with Hezbollah, Iran, Hamas.”



Bob McNally, president of Rapidan Energy, warned that tensions in the Middle East are “climbing the escalation ladder.” If Iran strikes Israel and kills civilians, the Netanyahu government will hit back much harder, he said.



“Israel is in a not in an eye for an eye mode,” McNally said. “They’re in three eyes for one eye mode.

home

African Markets – Factors to watch on Aug 7

South Africa moves to implement national health bill despite resistance

Bank of Japan won’t raise rates when markets unstable, deputy governor says

UN agency raises just 20% of needed southern Africa drought aid in tough funding environment

How Orange Juice Became More Expensive Than Ever

Nigeria detains tailors who made Russian flags for anti-government protests

The popular ‘carry trade’ is unwinding — and economists fear Fed rate cuts could make matters worse

Japan’s quest for the most powerful microchip leads semiconductor revival

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

UJ soars to top its highest-ever position in the global university rankings

Kenyan shilling eases slightly; expected to hold steady

Nedbank raises non-interest revenue growth guidance after sold first half

Kenya’s Mobius, maker of rugged cars for African roads, calls it a day

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

U.S. crude oil falls to six-month low as market sells off on recession fears

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African Markets – Factors to watch on Aug 7

South Africa moves to implement national health bill despite resistance

Bank of Japan won’t raise rates when markets unstable, deputy governor says

UN agency raises just 20% of needed southern Africa drought aid in tough funding environment

How Orange Juice Became More Expensive Than Ever

Nigeria detains tailors who made Russian flags for anti-government protests

The popular ‘carry trade’ is unwinding — and economists fear Fed rate cuts could make matters worse

Japan’s quest for the most powerful microchip leads semiconductor revival

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

UJ soars to top its highest-ever position in the global university rankings

Kenyan shilling eases slightly; expected to hold steady

Nedbank raises non-interest revenue growth guidance after sold first half

Kenya’s Mobius, maker of rugged cars for African roads, calls it a day

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

U.S. crude oil falls to six-month low as market sells off on recession fears

News Tips

Advertise With Us

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