Daily Report 08 February 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed flat at the 79 534 level.

Renergen’s share price fell 4% on news that the company placed 4.6-million new shares in an accelerated book build to raise money for phase two of its liquid gas and helium production.

PPC Ltd gained about 20%, after reports that the company was considering selling its Zimbabwe business for about $200 million.

In a trading update from Pick n Pay Stores Limited for the 43 weeks ended 25 December 2022, the company said that the group has made excellent progress in implementing its Ekuseni Strategic

Plan, including implementation of the new customer value propositions (CVP) in Pick n Pay and Pick n

Pay QualiSave and the rollout of the Boxer and Clothing growth engines. Group sales increased 9.3%.

South Africa’s sales growth for the 17-week period was 6.1% (2.0% like-for-like). Pic n Pay previously guided the market to expect broadly flat FY23 earnings.

 

SA Economy:

The Reserve Bank said that South Africa’s net foreign reserves rose to $54.844 billion in January from $53.827 billion in December.

President Cyril Ramaphosa said that he will wait until after the state of the nation address (SONA) on Thursday to reshuffle the national executive.

The SA Revenue Service (SARS) has signaled that tax collection will come in lower this fiscal year as a result of the worsening power cuts and the elevated cost of living.

 

Global Economy:

China’s foreign exchange reserves rose to $3.184 trillion at the end of January 2023, up from $3.128 trillion in the previous month and above market expectations of $3.152 trillion.

German industrial production fell more than expected in December, falling 3.1% from the previous month, far weaker than the expected drop of 0.7%.

The Reserve Bank of India raised its benchmark interest rate by 25 basis points to 6.50%, in line with expectations.

US Fed Chair Powell said that if the job market strengthens further in the coming months or inflation readings accelerates, the central bank might have to raise interest rates higher than it now projects.

 

Global Company:

The FTSE 100 closed 0.36% higher at 7 864.

BP reported a record profit of $28 billion for 2022. The oil company raised its fourth-quarter dividend by 10%, launched a US$2.75bn share buy-back and raised earnings targets out to 2030. BP shares closed 3.6% higher.

The Hang Seng Index is trading flat at 21 303. The tech sector and consumer cyclicals weighed on the index with losses from Meituan falling 7.6%, Alibaba Health Ltd. down 4.3% and Alibaba Group Ltd. lower by 1.5%.

In China, the Shanghai Composite is down 0.25% to 3 239.

The Dow Jones Industrial Average closed 0.78% higher to 34 156, while the S&P 500 was up 1.27% to 4 164.

Hertz and DuPont rose almost 7.5% and 7.4%, respectively, as a result of earnings that beat market expectations.

 

Commodities:

Gold is up 0.29% to $1 871.70/oz, while Platinum is higher by 1.19% to $977.70/oz.

Brent crude was 3.23% higher at $83.69 a barrel.

 

Currencies:

The rand traded at R17.54 against the US Dollar, R21.13 against British Pound and R18.83 against the Euro.

The Euro is slightly weaker against the US Dollar to trade at $1.0733.