Goldman Sachs announced it expects fourth quarter earnings to take a $5bn knock. This is mainly attributed to the new US tax laws signed by US President Donald Trump a few weeks ago. Of the $5bn, two-thirds will be related to repatriation tax. The new laws significantly lower the tax rate for US companies to 21%, down from 35%. As a result, companies will now be able to repatriate cash from overseas at far better rates.
In currencies, the rand strengthened, helped along by reports the Constitutional Court had ruled that Parliament had failed to hold President Jacob Zuma to account over Nkandla. After a previous close of R12.40/$, the rand was at R12.396/$ at 08:30. From there, the local currency rallied to a high of R12.29/$ at 12:15, before it erased its gains and moved to a low of R12.414/$ at 21:30. After remaining mostly unchanged over the course of the weekend, the rand is just below the R12.38/$ level this morning.
In Asia, markets are mostly higher, with the exception of the Australian ASX, as indices extended 2017’s strong gains. The Hang Seng featured among the top performers, with the index surging 1.64% to 30,408.97 index points. The Shanghai Composite was also in positive territory this morning, up 1.08%, on track to end higher for the third consecutive session. The Australian ASX is set to extend Friday’s decline after it fell 0.32% to just below the 6,150 index point level. The Japanese Nikkei was closed for another public holiday this morning.
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