Daily Report 10 December

SA Company News:

The JSE All Share Index closed 0.3% lower at 72 208. Royal Bafokeng Platinum announced that Northam Platinum Holdings made an unsolicited approach to buy it out. RBPlat said its board would consider Northam’s approach, which includes that it be allowed to perform due diligence on the same basis as that by its larger rival, Impala Platinum, who is also trying to acquire control of RBPlat. Tongaat Hulett appealed to shareholders to back a rights issue of more than five times its market value. The company is asking shareholders to inject R4bn as it battles a R6.9bn total debt pile, while at the same time the company is struggling to generate cash and sell off assets to meet demands from lenders.

SA Economy:

Mining production in South Africa rebounded by 2.1% year-on-year in October 2021, compared to a downwardly revised 0.8% contraction in September and better than market estimates of a 0.85% fall. South Africa posted a smaller current account surplus in the third quarter. The current account surplus shrank to R226 billion from July to September, compared with a R311 billion surplus registered in the previous three-month period. Manufacturing production in South Africa fell 8.9% year-on-year in October 2021.

Global Economy:

Producer prices in Japan increased 9% year on year in November 2021 from 8% in the previous month, beating consensus forecasts for an 8.5% rise and accelerating at its fastest pace since December 1980 due to high commodity prices.  According to a Reuters report, the global shipping crisis looks set to go on delaying goods traffic and fueling inflation well into 2023. China car sales fell by 9.1% year-on-year to 2.52 million units in November 2021, as a global shortage of semiconductors continued to hurt the auto sector. Key US inflation data is due out later today, a higher-than-expected US CPI reading would strengthen the case for further policy tightening by the Federal Reserve. India’s farmers will call off a long-running protest after the government accepted most of their demands including assurances to consider guaranteed prices for all produce, not just rice and wheat. Farmers have been on strike since the Indian government passed three new laws in September 2020, initially with the aim to modernise India’s agricultural sector by giving them more choices to sell their produce. Farmers argued that it gives corporations control over the sector.

Global Company News:

China Evergrande is formally in default after missing payments on two-dollar bonds and a loan guarantee on Monday. This will consequently trigger cross-default clauses on over $19 billion of Evergrande debt and a major restructuring of those liabilities. The Italian competition authority has imposed a fine of more than $1.2 billion on Amazon.com, saying the retailer has an “absolute dominance” in the market and that it has damaged its competitors in e-commerce logistics. Amazon said it “strongly disagreed” with the Italian regulator’s decision and that they would appeal this decision. Wall Street closed lower as investors banked some profits after three straight days of gains. The S&P 500 and the Nasdaq lost 0.7% and 1.7% respectively as consumer discretionary and real estate stocks weighed on the indexes.

Commodities:

Gold lost 0.4% to $1 776/oz, while Platinum fell 2.5% to $930/oz. Brent crude was down 2.2% at $74.04 a barrel.

Currencies:

The rand traded at R15.95 against the US Dollar, R21.15 against British Pound and R18.07 against the Euro. The Euro is flat at $1.13.

Brent Oil Futures
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Gold Futures
Top 40 Futures

 

Market Indicators

Commodities $ Cross Currencies ($) Major Indices
Gold 1776,11 -0,40% USD/ZAR 15,95 Top40 65780,00 -0,32%
Platinum 930,80 -2,52% GBP/ZAR 21,15 Dow 30 35754,69 0,00%
Brent 74,04 -2,55% EUR/ZAR 18,07 S&P 500 4667,45 -0,72%
Copper 4,31 -1,18% EUR/USD 1,13 FTSE 7321,26 -0,22%
Palladium 1800,50 -3,08% USD/JPY 113,51 DAX 15639,26 -0,31%
Iron Ore 103,50 -1,93% BITCOIN 47977,20 Shanghai 3660,46 -0,48%
Source:  Moneyweb & Investing.com