Daily Report 10 March 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed marginally lower at the 77 664 level.

In a trading update from Thungela Resources, the company said that it expected to report a 100% increase in 2022 earnings, driven by record high coal prices. Headline earnings per share (HEPS) to be between R130 ($6.99) and R133 rand ($7.15) for the year ended 31 December, up from R61.08 in 2021. The company expects to release its financial year results on the 27^th of March. Thungela shares rose 1% to R207.94 per share.

In a trading update from OUTsurance, the company said that it expects EPS in the six months ended 31 December 2022, to fall by 73% to 83% and the headline EPS to decline by 16% to 26% on a yearly basis.

Headline EPS is expected to be between 81.3 cents and 92.2 cents, compared with R1.098 a year ago.

Exxaro said that headline earnings per share (HEPS) for the year ended 31 December 2022 is expected to increase between 20% and 34%, when compared to the previous year. This was mainly due to the excellent performance of their coal business driven by higher export and domestic sales prices despite the ongoing logistical challenges. This was partially offset by a lower contribution from our energy business due to persistent low wind conditions over the past twelve months.

Sanlam said that its net results from financial services increased to R10.19 billion in 2022, from R9.46 billion in the prior full year. The company exceeded the R10 billion mark for the first time in its full year ended 31 December 2022. Sanlam reported headline earnings per share (HEPS) growth of 3% for the year, from 438c to 454c. The board declared a final gross cash dividend of 360c per share, compared to 334c per share in FY2021.

 

SA Economy:

South Africa’s current account balance switched to a deficit of 2.6% of gross domestic product in the final quarter of 2022 from a small surplus in the third quarter. The current account deficit for the October-December period was R174.0 billion from a surplus of R3.1 billion in the previous quarter.

 

Global Economy:

US jobless claims rose to a 2 month high. The number of Americans filing unemployment benefits increased by 21 000 from the previous week to 211 000, well above market expectations of 195 000.

Attention now turns to the US nonfarm payrolls data due later today, any signs of resilience in the jobs market gives the Federal Reserve more room to keep raising rates.

The British economy grew 0.3% month-over-month in January 2023, rebounding from a 0.5% contraction in December and beating market forecasts of a 0.1% rise.

 

Global Company:

The FTSE 100 closed 0.63% lower at 7 770.

Credit Suisse shares fell 3% after the company announced that it will delay the publication of its 2022 annual report after a late call from the US Securities and Exchange Commission. The Swiss bank said the SEC had raised questions over the technical assessment of previously disclosed revisions to its consolidated cash flow statements in 2020 and 2019.

The Hang Seng Index is lower by 2.2% to 19 468, with all the major sectors dragging down the index.

JD.Com fell around 11% after weaker-than-expected revenue guidance and BYD Co. also falling 8%.

In China, the Shanghai Composite is down 0.87% to 3 247.

The Dow Jones Industrial Average closed 1.69% lower to 33 696, while the S&P 500 was down 1.8% to 3 918.

SVB Financial shares led the losses, falling 60% after the company said that it plans to raise more than $2 billion in capital to offset losses from bond sales.

Silvergate shares fell more than 42% on news reports that the company is closing down its operations.

Bank of America and Wells Fargo also fell quite sharply, each down more than 6% each.

 

Commodities:

Gold is up 0.91% to $1 829/oz, while Platinum is higher by 0.92% to $946.80/oz.

Brent crude was 1.31% lower at $81.59 a barrel.

 

Currencies:

The rand traded at R18.52 against the US Dollar, R22.08 against British Pound and R19.61 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0587.