Daily Report 03 November 2022

SA Company News:
The Johannesburg Stock Exchange All-Share Index closed 0.4% lower at the 67 123 level.
The JSE said that they have extended the deadline for Fortress REIT to submit a compliant REIT declaration until the end of November. Failing to do so will mean Fortress will risk losing its status as a real estate investment trust (REIT).
In a trading update from Pepkor, the company said that they expect earnings per share to increase by between 23.1% – 33.1% and headline earnings per share to be between 18.6% and 28.6% higher when compared to the previous corresponding period. Pepkor’s results for the year ended 30 September 2022 will be published on SENS on Tuesday, 22 November 2022.
In an operational update from Goldfields, for the quarter ended 30 September 2022, the company said that gold production for the third quarter of 2022 was down 1% year-on-year to 597 000 ounces, US$1 061 per ounce of all-in sustaining cost and US$1 279 per ounce of all-in cost. Gold Fields has also said that they are making good progress on the Yamana transaction.
Sibanye Stillwater Limited’s operational update, for the quarter ended 30 September 2022, stated that its third quarter adjusted EBITDA fell, and that its 2022 U.S. platinum group metals production is now seen at the lower end of its forecast. South Africa PGM production for the quarter was 432 143 ounces, down 14% and U.S. PGM production was 85 889 ounces, down 40% for the year.
In an operational update from AngloGold, for the quarter ended 30 September 2022, the company said that production for the third quarter of 2022 rose 20% to 738 000oz compared to 613 000oz in the third quarter of last year. Total cash costs increased to $966/oz in the third quarter of 2022, 4% higher than the $927/oz in the same period last year. AngloGold said that their balance sheet remains in a solid position after paying an interim dividend, with approximately $2.5bn in liquidity, including cash and cash equivalents of $1.2bn at the end of September 2022.

SA Economy:
The SA Reserve Bank deputy governor, Rashad Cassim said that South Africa’s economy needs to expand consistently at 5% for years to create jobs and lower an unemployment rate that’s among the world’s highest.
The International Monetary Fund (IMF) said that the Finance Minister, Enoch Godongwana did the right thing by cutting debt requirements and saving some of the windfalls, but he may have been too optimistic in assuming that he will hit the fiscal targets he has set. The IMF said that there are substantial risks to the fiscal framework, including public servant wages, state-owned enterprises, and the future of the basic income grant.

Global Economy:
The ADP report showed that private businesses in the US created 239 000 jobs in October 2022, compared to market forecasts of 195 000.
The U.S. Federal Reserve raised interest rates by 75 basis points to 3.75 – 4.0% but noted that policy acted with a lag. Fed Chair, Jerome Powell said that they are now more comfortable with taking smaller rate increases for a longer period than delivering larger increases now. Investors now expect rates to top out at more than five percent, compared with four percent currently. The release of the US jobs figures tomorrow will give another insight into the state of the economy.
The Caixin China General Services PMI fell further to 48.4 in October 2022 from 49.3 in September, contracting for the 2nd straight month.
The S&P Global Hong Kong PMI rose to 49.3 in October 2022 from 48.0 in the previous month.

Global Company:
The FTSE 100 closed 0.58% lower at 7 144.
The Danish shipping company, Maersk reported a quarterly net profit of $8.88 billion, up from $5.44 billion, as revenue rose 37% to $22.77 billion, but said that they have to cut their demand forecast for the rest of the year as the global economic slowdown takes hold.
The ratings agency, Standard & Poor has cut Credit Suisse’s long-term rating by one notch to BBB-, the lowest rating that still qualifies as investment grade, on fears of risks to its recapitalization strategy.
The Hang Seng Index is lower by 2.63% to 15 410.
In China, the Shanghai Composite is down 0.33% to 2 993.
The Dow Jones Industrial Average fell 1.5% to 32147, giving up a gain of more than 400 points earlier in the afternoon, while the S&P 500 was down 2.5% to 3 759.
Airbnb reported its highest quarterly profits ever. The home rental platform saw its net profit climb 46% year-over-year to $1.2 billion. The profit and bookings were both less than what analyst expected. However, Airbnb said that they expect revenue to continue to grow in the fourth quarter by between $1.80 billion and $1.88 billion during the holiday season.

Commodities:
Gold is down 0.91% to $1 635/oz, while Platinum is lower by 2.92% to $931/oz.
Brent crude was 0.05% lower at $95.53 a barrel.

Currencies:
The rand traded at R18.29 against the US Dollar, R20.83 against British Pound and R17.95against the Euro.
The Euro is slightly weaker against the US Dollar to trade at $0.9811.