Daily Report 26 October 2022

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 1.4% higher at the 65 851 level, mainly supported by a recovery in tech stocks. Naspers and Prosus added 2.5% and 1.49%, respectively.

Pick n Pay Stores Limited has been approved for a secondary listing on A2X Markets (A2X). Its shares will be available to trade on A2X from 1 November 2022.

Reinet (RNI) reported that its net asset value (NAV) per share as of 30 September 2022 decreased 4.7% q/q to €31.77 since 30 June 2022, but increased 13.6% y/y.

Famous Brands Limited reported its interim financial results for the six months ended 31 August 2022 and said that headline earnings per share was up 121% to 215 cents and revenue rose 19% to R3.6bn. Famous Brands has guided that HEPS, could be 99% – 143% higher at between R1.93 and R2.36. The company declared dividend per share of 130 cents.

 

SA Economy:

The Reserve Bank data showed that the composite leading business cycle indicator, which offers a projection of SA’s economic growth cycle for the next 6-12 months, decreased by 2.3% on a monthly basis, and by 3.0% year on year.

Eskom said that they have been engaging with the World Bank to provide funding for the re-powering and repurposing of Komati power station. The project would see 430 permanent jobs created, along with 7 700 temporary jobs that would benefit the surrounding community. The project plans to add 370MW of new generation capacity through solar and wind power. The estimated cost of the project will be over R7.9 billion.

 

​Global Economy:

Hong Kong’s trade deficit rose to $44.9 billion in September 2022, from $42.4 billion in the same month a year ago.

The IFO Business Climate indicator for Germany edged lower to 84.3 in October of 2022, the weakest since May 2020, compared to an upwardly revised 84.4 in September.

The average price of single-family houses in the US with mortgages guaranteed by Fannie Mae and Freddie Mac in the US fell 0.7% from a month earlier in August 2022. This is the first time since March 2011 that the index has seen two consecutive months of decline.

The Baltic Dry index extended losses for the fifth straight session yesterday, falling 2.3% to 1 755 points, amid weaker demand across all its vessel segments.

 

Global Company:

The FTSE 100 closed flat at 7 014, as investors digested mixed earnings reports, while awaiting clarity on the new prime minister’s policy direction.

HSBC Holdings Plc. shares fell 5% after the bank reported higher-than-expected profits in the third quarter, while setting aside loan loss provisions of $1.1 billion.

The Hang Seng Index is higher by 0.46 % to 15 236. The Hang Seng recovered slightly after China said that they want to promote foreign investment with a focus on the manufacturing sector.

In China, the Shanghai Composite is up 0.55% to 2 992.

The Dow Jones Industrial Average rose by 1.07 % to 31 836, while the S&P 500 climbed 1.63% to 3 859, as investors waited for earnings reports from Microsoft and Google-parent, Alphabet.

Alphabet shares fell about 7% on weaker-than-expected earnings and revenue as the firm had to deal with slowing online advertising spending.

Microsoft reported first quarter EPS of $2.35, down from $2.71, while revenue grew to $50.12 billion from $45.32 billion.

UPS shares rose 3.5% after the parcel service reported a rise in third quarter adjusted profit as higher delivery prices offset softening e-commerce demand.

Shares of Meta Platforms dipped 0.2% after its messaging app, WhatsApp stopped working for many people across the world.

 

Commodities:

Gold is up 0.72% to $1 662/oz, while Platinum is higher by 0.73% to $927/oz.

Brent crude was 0.69% lower at $90.83 a barrel.

 

Currencies:

The rand traded at R18.17 against the US Dollar, R20.85 against British Pound and R18.13 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $0.9978.