SOUTH AFRICA: US Rumoured To Be Plotting To Exclude S. Africa From G20 Meetings
- Further evidence of South Africa's intensifying diplomatic conflict with the US came to light as Bloomberg reported that Pretoria expects to be excluded from the G20 meetings during the US presidency next year. Unnamed officials in Pretoria speaking with the outlet were convinced that 'an announcement is imminent' after South Africa convinced members of the bloc to sign off on a top-level Leaders' Declaration at the Johannesburg summit boycotted by the US, despite the Trump administration's warning not to do so in its absence. It is unclear if the US can exclude a G20 member from the group's proceedings unilaterally, with Bloomberg noting that 'the most likely course of action would be for Washington to withhold visas for South African officials'. The US could also call for South Africa's removal from the G20 and its replacement with a new member from Central Europe.
- South Africa handed over the G20 presidency to a junior US diplomat during a low-key ceremony on Tuesday, which was not immediately communicated to the media. The US will assume its duties on December 1.
- News24 reported that Eastern Cape Premier Oscar Mabuyane sees a potential third term as provincial party leader as a stepping stone to the position of ANC Deputy President in 2027.
- The National Treasury proposed introducing a 20% tax on the gambling sector in a move that could generate as much as ZAR10bn for the budget. The Treasury said that the measure was not designed to raise revenue but to discourage abuse.
- Demand at yesterday's SAGB auction rose, with the bid-to-cover ratio reaching 3.4x versus 1.9x last week. The amount on offer was reduced to ZAR3bn from the usual ZAR3.75bn in the wake of the Medium-Term Budget Policy Statement (MTBPS).
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EQUITY TECHS: E-MINI S&P: (Z5) Starts The Week On A Bullish Note
- RES 4: 6953.25 2.000 proj of the Aug 1 - 15 - 20 price swing
- RES 3: 6912.25 3.000 proj of the Aug 20 - 28 - Sep 2 price swing
- RES 2: 6900.00 Round number resistance
- RES 1: 6890.00 1.764 proj of the Aug 1 - 15 - 20 price swing
- PRICE: 6887.25 @ 07:23 GMT Oct 27
- SUP 1: 6812.25/6731.66 High Oct 9 / 20-day EMA
- SUP 2: 6645.22 50-day EMA
- SUP 3: 6540.25 Low Oct 10 and a key short-term support
- SUP 4: 6506.50 Low Sep 5
The trend condition in S&P E-Minis remains bullish and the contract is trading higher today, as it begins the week on a bullish note. The fresh cycle high confirms a resumption of the primary uptrend and maintains the bullish price sequence of higher highs and higher lows. Sights are on 6850.87, a Fibonacci projection. Initial support to watch lies at 6721.62, the 20-day EMA. The 50–day EMA is at 6637.80.
SWEDEN: Lending Growth Cotninues To Expand Steadily
Swedish non-financial corporation lending growth eased three tenths to 2.5% Y/Y in September, but remains comfortably above the H1 average growth rate of 0.95%. The continued passthrough of easier monetary policy should continue to support business lending growth in the coming months. The 2010-2019 average monthly growth rate was 3.5% Y/Y. Household lending (the majority of which is mortgage lending) ticked up another tenth to 2.8% Y/Y (vs 1.8% at the start of this year).
- Around 70% of Swedish household mortgages are floating rate, so interest rate changes feed through to the real economy relatively quickly. In September, the average rate paid on floating rate mortgages fell to 2.80% (vs 2.86% prior), the lowest since August 2022.
- The Riksbank is expected to remain on hold at 1.75% for some time to come.
- This week's calendar includes plenty of growth data. The Riksbank (and the Government) will want to start seeing evidence of a recovery taking hold.
WTI TECHS: (Z5) Has Breached The 50-Day EMA
- RES 4: $71.47 - High Jun 23 and a key medium-term resistance
- RES 3: $67.68 - High Jul 30
- RES 2: $65.77/68.43 - High Sep 26 and key resistance
- RES 1: $62.59 - High Oct 24
- PRICE: $61.55 @ 07:17 GMT Oct 27
- SUP 1: $59.64/55.96 - Low Oct 23 / 20
- SUP 2: $54.85 - Low May 5
- SUP 3: $54.16 - Low Apr 9 and a key support
- SUP 4: $53.23 - 1.764 proj of the Jul 30 - Aug 13 - Sep 26 price swing
The latest recovery in WTI futures appears corrective for now, however, note that price has traded through resistance at the 50-day EMA, at $61.13. The breach of this average signals scope for a stronger recovery . A resistance at $62.34, the Oct 8 high, has been pierced. A clear breach of this level would expose key resistance at $65.77, the Sep 26 high. Key support and the bear trigger has been defined at $55.96, the Low Oct 20.
