SA Company News:
The JSE All-Share index closed 1.83% higher at 65 157 receiving a boost from a recovery in commodity prices. A strong trading update from Mondi PLC with EBITDA for the third quarter up 27% to R388 million as a result of higher average prices and strong volume growth year-on-year. The Foschini Group expects headline earnings per share of 364.0 cents per share compared to a headline loss per share of 91c per share in the previous six months. However, 29 stores remain closed and will only reopen in 2022 due to extensive structural damage caused by the looting in July.PSG Konsult Limited reported headline earnings per share increased by 23% to 30.6 cents per share and dividend per share increased by 25% to 10.0 cents per share. The share closed 5.8% lower at R11.20.
Due to breakdowns at Eskom’s generation plants the country is again facing electricity supply issues after Eskom implemented stage 2 load shedding yesterday, with further cuts expected over the weekend. President Cyril Ramaphosa has said the infrastructure backlog will take billions and decades to fill without contributions from the private sector. A welcome relief for travelers after the UK finally removes SA from the red list.
Investors are closely watching today’s jobs report. The US economy is expected to have created 500,000 new jobs in September. A favorable jobs number will certainly guarantee the tightening cycle will begin in November. The US approved legislation to temporarily raise the debt limit and avoid the risk of default. German output of cars and auto parts fell 17.5% in August due to supply chain disruptions. In the UK the risk of power cuts to factories and homes this winter has increased.
Global Company News:
The Hang Seng is 0.17% higher and the Shanghai Composite after a week-long holiday was up 20 points or 0.58% to 3 588. Samsung Electronics’ operating profit rose 28% driven by rising memory chip prices. Evergrande, whose shares remain suspended since Monday remains in focus as to how regulators propose to contain the contagion from the cash-strapped company. Tesla is moving its headquarters from California to Texas where it is building a car and battery manufacturing complex. The Dow Jones Industrial Average rose 1% to 34 754 and the S&P 500 rallied 0.8% to 4 399.
Gold prices eased to $1 761 per ounce. Oil prices continued to be volatile on reports that the United States may not release emergency crude reserves. Brent crude rose 0.6% to $83.44 a barrel.Iron ore futures in Singapore rose 6% to $124 a ton.
The rand was stable at R14.93/$.
The euro was down 0.05% to $1.154.
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