Records tumble on the sports arena as Lewis Hamilton breaks Michael Schumacher’s win record in F1 and Raphael Nadal bags another clay court victory at Rolland Garros.  For the Sharks fans it was great to see rugby back in action on SA shores and further away the New Zealand All Blacks got off to a scare, hanging on to a 16-16 draw in round 1 of the Bledisloe Cup.

By the close of trade on Friday, the South African rand had strengthened against the US dollar.

  • In the US, reports regarding the stimulus bill indicated that the Trump administration was willing to go to $1.80tn from its previous level of $1.60tn in its offer, compared to the Democrats $2.20tn proposal.
  • The U.S. Bureau of Safety and Environmental Enforcement (BSEE) said 91% of offshore crude oil production remains shut in the U.S.-regulated northern Gulf of Mexico following Hurricane Delta, which made landfall on Friday. In addition, 62.2% of natural gas output remains shut in the Gulf following the storm that made landfall near Creole, Louisiana, and weakened into a low-pressure system over Mississippi on Saturday.
  • On Friday, following its week-long Golden Week (National Day) holiday, the onshore yuan (CNY) which had not traded since the previous Friday, soared the most since China’s 2005 de-pegging – as it rushed to catch up to the recent gains in the offshore yuan (CNH) driven by a shift in market sentiment that a pro-China Biden administration may replace Trump, as well as the continued slide in the dollar.
  • On the data front, US wholesale inventories rose less-than-expected in August.
  • The yield on benchmark government bonds mostly fell on Friday. The yield on 2026 bond fell to 7.21%. Further, the yield on 2023 bond advanced to 4.53% while that for the longer-dated 2030 issue fell to 9.47%.

In early trade on Monday, the US dollar is trading higher against the South African rand at R16.4922, while the euro is also trading higher at R19.4844. The British pound has remained static against the South African rand to trade at R21.4886.

By the close of trade on Friday, the euro declined against most of the major currencies.

  • Investors grew wary about a second COVID-19 wave in Europe.
  • Australian Treasurer Josh Frydenberg has confirmed that the government’s coronavirus wage subsidy will end in March, leaving some businesses with no choice but to close. The JobKeeper Payment for workers who have lost hours as a result of COVID-19, was reduced from 1,500 Australian dollars (1,086.8 U.S. dollars) per fortnight to 1,200 Australian dollars on Sept. 28 and will be cut again to 1,000 Australian dollars on Jan. 4 until the end of March. Frydenberg said on Sunday that the scheme will end in March 2021 regardless of the status of COVID-19 in Australia.
  • In the UK, data showed that the British economy struggled to grow in August, setting back its recovery from the coronavirus lockdown. The British Finance Minister, Rishi Sunak, unveiled a new job support programme for those businesses which could be forced to close their doors because of tighter coronavirus restrictions, confirming that the staff of such businesses would receive two-thirds of their wages.
  • The Bank of Japan says the Producer Price Index sank 0.1 percent in September, excluding the effects of last year’s consumption tax hike. It’s the first drop in four months as business activities remained sluggish. The decline was larger year-on-year at 2.3 percent. Weakening demand for goods including steel and iron, machinery and textiles was behind the drop. BOJ officials expect the pandemic to continue weighing down producer prices.
  • Two of Saudi Arabia’s biggest banks signed a deal on Sunday for a merger to create a “national champion” for the Kingdom and a “regional powerhouse” for the Middle East. National Commercial Bank, the oldest in the country, is to combine with Samba Financial group in a $32 billion deal that will create the most profitable bank in the region. Together, they will control $223 billion in assets. The merger is part of the financial sector development program of the Vision 2030 strategy to diversify the economy, and is the second big banking merger of the past 12 months.

In early trade on Monday, the euro has slipped 0.1% against the US dollar to trade at $1.1816, while it has marginally gained against the British pound to trade at GBP0.9070.