Daily Report 01 March 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 0.3% higher at the 77 734 level. The JSE posted a 2.2% loss for the month of February.

In a trading update from Oceana Group, the said that they expect interim headline earnings per share (HEPS) to be more than 20% higher than year-ago. The higher canned fish sales volumes, which includes the Lucky Star brand, rose 33% year on year to 3.5-million cartons, has lifted the performance of the fishing group. Oceana also announced last October that it would sell its wholly owned subsidiary Commercial Cold Storage (CCS Logistics) for R760m. It has received the regulatory approval for the sale from SA competition authorities and the department of forestry, fisheries & environment, but competition authorities in Namibia still needs to give their approval.

Nokia has announced that it has been selected by MTN South Africa as one of its 5G Radio Access Network (RAN) equipment providers. Under the deal, Nokia will modernise the existing 2G, 3G, 4G radio network and expand MTN’s 5G radio network across 2 800 sites in the central and eastern part of the country.

Sibanye Stillwater reported a 49% decline in full-year profit after a three month strike at its South African gold mines and flooding at its U.S platinum operations impacted production. Headline earnings per share (HEPS) fell to R6.52 ($0.3537) for the year ended 31 December 2022 from 12.72 rand a year earlier. Sibanye declared a final dividend of R1.22 per share, bringing the total dividend for the year to R2.60 per share.

Woolworths Holdings Ltd reported a 75.1% jump in half-yearly earnings but warned of a slower growth in the second half as a power crisis at home hits profitability. Woolworths said that headline earnings per share (HEPS) rose to 294.5 cents in the reporting period, up from 168.2 cents in the prior year. Revenue grew 11% to R45.10 billion vs year-ago of R39.20 billion. The Board has declared an interim dividend of 158.5 cents (126.8 cents net of dividend withholding tax) for the 26 weeks ended 25 December 2022.

 

SA Economy:

The unemployment rate fell to 32.7% in the final three months of 2022 from 32.9% in the July-September period. The number of unemployed persons rose by 28 000 to 7.753 million and the number of employed persons increased by 169 000 to 15.934 million.

Reserve Bank data released yesterday showed that private sector credit extension (PSCE) rose by 8.4% year on year in January. The reading follows December’s 7.7% year-on-year growth and marks the 19th consecutive month of rise in private sector credit.

South Africa recorded a budget deficit of R88.80 billion ($4.82 billion) in January, compared to a deficit of R65.93 billion in the same month a year earlier.

 

Global Economy:

The US trade deficit in goods widened to $91.5 billion in January 2023 from a revised $89.7 billion in December. Exports of goods increased 4.2% to $173.8 billion, while imports advanced 3.4% to $265.3 billion.

The S&P CoreLogic Case-Shiller home price index in the US rose 4.6% year-on-year in December of 2022, below the 6.8% increase in November and forecasts of 5.8% increase.

Manufacturing activity in China grew the most in over a decade during February. The official NBS Manufacturing PMI increased to 52.6 in February 2023 from 50.1 in the previous month, exceeding market estimates of 50.5.

 

Global Company:

The FTSE 100 traded lower as investors assess the details of a deal between the U.K. and EU on post-Brexit Northern Ireland trading arrangements.

The FTSE 100 closed 0.75% lower at 7 876, dragged down by losses in the healthcare sector and disappointing earnings results from online grocery company Ocado.

The Hang Seng Index is higher by 3.87% to 20 553. Gains were broad-based, with healthcare, financials, real estate, and consumers among top performers.

In China, the Shanghai Composite is up 0.76% to 3 304.

The Dow Jones Industrial Average closed 0.71% lower to 32 656, while the S&P 500 was down 0.3% to 3 970. The Dow Jones is down 3.5% for the month, while the S&P 500 lost 2.3%.

Target shares rose 3% after the retailer posted quarterly results that beat market estimates as consumer spending shifted away from discretionary categories.

 

Commodities:

Gold is up 0.65% to $1 828/oz, while Platinum is higher by 1.42% to $955.20/oz.

Brent crude was 1.72% higher at $83.89 a barrel.

 

Currencies:

The rand traded at R18.30 against the US Dollar, R22.05 against British Pound and R19.39 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0596.