Daily Report 16 January 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 1% higher at the 79 334 level. The tech stocks, Naspers and Prosus were the main drivers as each of them gained 0.86%.

Fortress Real Estate Investments said that shareholders did not approve the payment of a distribution for the financial year ended June 30, 2022, to either FFA or FFB shareholders under the company’s proposed amended rules. The property company had proposed in November 2022 to declare a distribution to both FFA shareholders and FFB shareholders in an 80/20 split, but relevant proposals did not receive the requisite majority support. To maintain REIT status, SA-listed property companies are required to pay a minimum of 75% of their taxable earnings available for distribution as a dividend annually within a period of four months after its year-end.

MTN said that they have received a tax bill of as much as R13bn in Ghana. The Ghana Revenue Authority’s investigation alleges that MTN Ghana under-declared its revenue by 30% between 2014 and 2018.

 

SA Economy:

President Cyril Ramaphosa said that he will not be attending the World Economic Forum (WEF) in Davos, Switzerland, as he must be in South Africa to deal with the electricity crisis.

The President also said that the national energy crisis committee should work with more urgency and speed to implement the national energy plan in order to mitigate the impact of indefinite Stage 6 load shedding.

 

Global Economy:

Germany’s economy grew by 1.9% in 2022, slightly above market expectations of 1.8%, but slowing from a 2.6% expansion in 2021.

UK GDP inched up 0.1% between October and November 2022, analyst consensus was calling for a 0.2% contraction. The better-than-expected economic performance in the U.K. means the country has potentially avoided a second-consecutive quarter of contraction.

China’s new home prices dropped by 1.5% year-on-year in December 2022, after a 1.6% decline in the previous month.

 

Global Company:

The FTSE 100 closed 0.64% higher at 7 844, led by gains in mining shares. Glencore, Antofagasta, BHP and Rio Tinto all rising.

Vodafone shares fell 0.2% after the Financial Times reported that Vodafone is planning to cut several hundred jobs, most of which will be at its London headquarters.

The Hang Seng Index is lower by 0.31% to 21 669.

In China, the Shanghai Composite is up 1.08% to 3 229, with technology and healthcare stocks leading the gains.

The Dow Jones Industrial Average closed 0.33% higher to 34 302, while the S&P 500 was up 0.4% to 3 999.

JPMorgan Chase kicked off the fourth-quarter earnings reporting season with upbeat results, it warned however, that they are setting aside $1.4 billion in anticipation of a mild recession, which, in turn, drove its shares down 3%.

Bank of America also reported better-than-expected fourth-quarter profit.

Wells Fargo fell nearly 4% after reporting a 50% drop in quarterly profit.

US markets will be closed today for the Martin Luther King public holiday.

 

Commodities:

Gold is up 1.19% to $1 918/oz, while Platinum is lower by 1.02% to $1 063/oz.

Brent crude was 1.47% higher at $85.28 a barrel.

 

Currencies:

The rand traded at R16.80 against the US Dollar, R20.58 against British Pound and R18.23 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0851.