Daily Report 13 February 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 1.3% lower at the 78 985 level, mainly dragged down by tech stocks, resources and financials. For the week, the JSE was 1.6% lower.

In a trading update from Pan African Resources, the gold producer forecast EPS for the six months ended December 31, 2022, of between $0.014 and 0.0164, a drop of between 31% and 41% from the $0.0239 of EPS in the prior year. The company said the decrease was largely as a result of an 19.2% decrease in gold revenue to $156.5M.

EOH announced that it had received overwhelming support in respect of the Rights Offer and has successfully raised a total amount of R600 million. The company said that this gives them the ability to invest in growth knowing that our strategy for EOH 2.0 and has the full backing of the shareholders and lenders.

In a trading update from Anglo American Platinum Ltd., the company said that they expect headline earnings, headline earnings per share and earnings per share to decrease by around 33% to 52% for the year. Amplats said these declines was mainly due to a 26% decrease in the sales volumes of platinum group metals, despite a 2% rise in the rand basket price.

 

SA Economy:

Eskom COO Jan Oberholzer said that Unit 5 at Kusile power station which was damaged by fire, will be repaired three months earlier than expected. Engineers are working to have the 800-megawatt Unit 5 repaired by July which was originally expected to be finished by October.

The Communications Worker Union (CWU) said that the South African Post Office (SAPO) will retrench about 6 000 employees across the country.

 

Global Economy:

Russia said that they will cut oil output by 500 000 bpd from next month. The move was to follow through on its threat to retaliate against Western sanctions, as Russia had repeatedly threatened to cut its output since the cap on Russian exports was implemented by the EU and G7 nations in December.

China’s current account surplus widened to $417.5 billion in 2022, the equivalent to 2.3% of the GDP, and up 32% compared to 2021.

The China Association of Automobile Manufacturers said that motor vehicle sales plunged 35% from a year earlier to 1.65 million units in January 2023, the lowest figure for the month since 2012 and compared to an 8.4% drop a month earlier.

Investors are now focusing on the US inflation data due out tomorrow that could guide the rates outlook, as well as more corporate earnings from major US firms this week.

 

Global Company:

The FTSE 100 closed 0.36% lower at 7 882 on Friday, pulling back from its record closing high the previous day.

The Hang Seng Index is lower by 0.47% to 21 085, with declines in almost all sectors as investors moved away from riskier assets.

In China, the Shanghai Composite is up 0.6% to 3 280, with investors scooping up growth-oriented shares.

The Dow Jones Industrial Average closed 0.5% higher to 33 869, while the S&P 500 was up 0.22% to 4 090. For the week, the Dow was up 0.2%, while the S&P 500 dropped 0.6%.

Expedia shares fell 8.5% after releasing a disappointing quarterly earnings report.

 

Commodities:

Gold is down 0.18% to $1 862.80/oz, while Platinum is lower by 1.3% to $945.60/oz.

Brent crude was 2.19% lower at $86.39 a barrel.

 

Currencies:

The rand traded at R17.93 against the US Dollar, R21.60 against British Pound and R19.13 against the Euro.

The Euro is slightly weaker against the US Dollar to trade at $1.0671.