Daily Report 09 March 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 1% lower at the 77 742 level.

Anglo American said that rough diamond sales at De Beers improved from the previous sales cycle due to high jewellery demand, but sales declined on an annual basis. Provisional rough diamond sales value for the second sales cycle of 2023 rose to $495 million, up 9% from $454 million in the first cycle. De Beers which form part of Anglo American group, holds ten sales cycles per year. Anglo American shares fell 1.26% at R627.70.

Quilter PLC reported results for the year ended 31 December 2022. The company said that group assets under management and administration ended the year at £99.6 billion (about R2 trillion), down 11% for the year. Profit before tax decreased by 3% to £134 million, and the decline in net management fees to £483 million. Total dividend per share from continuing operations (pence) 4.5 vs year-ago 4.0.

The JSE Ltd reported a 4% rise in profit after tax to R749 million for the year to ended 31 December 2022, with headline earnings per share coming in at 917.7c, 4% higher than the previous year’s 878.9c. Revenue was recorded at 2.7 billion rands from 2.58 billion rands. The board declared an ordinary dividend of 769c per share, 2% higher than the previous year.

Sanlam said that its full-year profit rose 3% as it benefitted from lower death claims in its life insurance business. Headline earnings per share was 454 cents in the year to 31 December, compared with 438 cents a year earlier. Sanlam’s annual earnings from life insurance business increased by 25%, its general insurance profit declined by 32%.

Standard Bank Group reported a 33% rise in full year profit. The company made a net profit for the year ended 31 December of R34.64 billion, compared with R24.87 billion the previous year. The company posted headline earnings per share of R20.87 cents, up from R15.73 a year earlier. Standard Bank declared a final dividend of 691 cents per share.

 

SA Economy:

The RMB/BER business confidence index in South Africa fell for the fourth consecutive quarter to a two-year low of 36 in the first quarter of 2023.

The power crisis continues to deteriorate with, economists surveyed by Bloomberg expect GDP to fall in the quarter to March, which means the economy may already be in a recession. Eskom also said that it would miss the target of a 1 862 megawatts increase in power output from six plants by end-March.

The ratings agency, S&P Global downgraded its outlook on South Africa to “stable” from “positive”. S&P Global said that economic growth in South Africa was facing increasing pressure due to infrastructure constraints, particularly from severe electricity shortages.

 

Global Economy:

Private businesses in the US created 242 000 jobs in February 2023, well above the 119 000 in January and market forecasts of 200 000 jobs.

The US trade deficit increased slightly to a three-month high of $68.3 billion in January 2023 from a downwardly revised $67.2 billion in December, compared to market forecasts of a $68.9 billion gap.

China’s annual inflation rate fell to 1.0% in February 2023 from 2.1% in the prior month, missing market forecasts of 1.9%, with prices of both food and non-food slowing sharply.

 

Global Company:

The FTSE 100 closed 0.13% higher at 7 929.

The motor insurer, Admiral Group Plc fell 4.2% after the company said that it had cut its full-year dividend and its annual profit missed estimates due to increased claim costs.

The Hang Seng Index is higher by 0.18% to 20 087.

In China, the Shanghai Composite is down 0.23% to 3 275.

The Dow Jones Industrial Average closed 0.18% lower to 32 798, while the S&P 500 was up 0.14% to 3 992.

Healthcare shares were the main decliners on the Dow. UnitedHealth shares dropped 1.4%, while Johnson & Johnson, Amgen and Procter & Gamble moved slightly lower.

Tesla shares fell for a third day and was down 3% after receiving a broker downgrade from a “buy” rating to a “hold”.

 

Commodities:

Gold is trading flat at $1 812/oz, while Platinum is higher by 0.5% to $938.10/oz.

Brent crude was 0.76% lower at $82.66 a barrel.

 

Currencies:

The rand traded at R18.60 against the US Dollar, R22.05 against British Pound and R19.62 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0552.