Daily Report 14 November 2022

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 3.2% higher at the 70 980, sparked by a rally in the resource sector.

The Foschini Group (TFG) reported a 18.1% rise in half-year earnings, supported by increasingly moving clothing manufacturing back home. The company said that revenue rose 23% to R25.1 billion and headline earnings per share (HEPS) came in at 464.6 cents in the six months ended 30 September, up from 393.4 cents. TFG declared an interim dividend of 170 cents per share. The Foschini Group also said that trading conditions and consumer confidence are likely to remain under pressure.

The Swiss luxury-goods group, Compagnie Financiere Richemont SA, reported a 40% increase in net profit from continuing operations of 2.11 billion euros ($2.15 billion) in the six months to 30^th September 2022. At a reported level, the company posted a net loss of EUR766 million, accounting for a write-off from the divestment of a majority stake in e-commerce platform Yoox-Net-A-Porter, agreed in August.

Jewellery Maisons performed well by achieving 24% sales growth and delivering a 37.1% operating margin. Richemont shares closed 13% higher on Friday at R214.70 per share.

Vodacom Group Limited released interim results for the six months ended 30 September 2022. The company said that revenue rose 7.7% to R53.7 billion and that headline earnings per share declined 9.5 %, impacted by start-up losses in Ethiopia and higher finance costs as interest rates normalised to pre-COVID levels. Vodacom declared interim dividend of 340 cents per ordinary share in respect of the six

months ended 30 September 2022 and will be payable on Monday 5^th December 2022.

 

SA Economy:

Transnet Freight Rail (TFR), the division of state-owned logistics company Transnet, has started the process to procure power from renewable energy sources as it moves to stabilise its energy supply and lessen its reliance on Eskom.

September retail sales will be the focus this week, while credit ratings agencies Moody’s and S&P are scheduled to give an assessment of SA’s credit rating on Friday.

 

​Global Economy:

The British economy expanded 2.4% year-on-year in the third quarter of 2022, the lowest reading since the contraction in the first quarter of 2021, but slightly above market expectations of 2.1%.

Ratings agency, Moody’s has cut India’s growth projections for the current and next calendar year due to higher inflation, high interest rates and slowing global growth. Moody’s said it now expects India’s GDP growth to slow to 7% in 2022, versus its previous estimate of 7.7% and then decelerate to 4.8% in 2023, before recovering to around 6.4% in 2024.

Investors will turn their focus to earnings reports from some of the big US retailers and the state of the crypto market after one of the biggest exchange FTX filed for bankruptcy.

 

Global Company:

The FTSE 100 closed 0.78% lower at 7 318, with sharp losses in the healthcare sector.

The Hang Seng Index is higher by 1.87% to 17 655, with Chinese property developers leading the gains.

In China, the Shanghai Composite is flat at 3 084.

The Dow Jones Industrial Average rose slightly by 0.1% to 33 747, while the S&P 500 climbed 0.92% to 3 992.

Amazon was up more than 4% on Friday, while Google-parent Alphabet was 2.6% higher as Tech stocks shook off a decline in cryptocurrencies.

 

Commodities:

Gold is flat at $1 761 /oz, while Platinum is lower by 1.66% to $1 028/oz.

Brent crude was 0.47% lower at $97.45 a barrel.

 

Currencies:

The rand traded at R17.32 against the US Dollar, R20.37 against British Pound and R17.85 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0308.