Daily Report 04 April 2023

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 0.7% higher at the 76 615 level, with mild gains in financials, industrials and resource shares. Sasol was up 5.68% to R253.62 per share.

Ayo Technology Solutions has confirmed some of the terms and conditions of its settlement deal with the Public Investment Corporation (PIC) whereby the company will repurchase R619 million worth of its shares from the Government Employees Pension Fund (GEPF) shares. Ayo said that subsequent to the initial repurchase the GEPF will retain a minimum stake of 25.01% in the company.

Glencore said that it had submitted a proposal to the board of Teck Resources Limited to merge with Teck and to simultaneously demerge their combined metals and coal businesses to create two companies,

MetalsCo, a standalone transition metals focused business with a diversified portfolio comprising Glencore’s and Teck’s metals and minerals assets, Glencore’s metals and energy (excluding coal) marketing, recycling and distribution businesses and its investment in Viterra. The investment in Viterra would be subject to a strategic review and potential divestment and CoalCo, a highly cash-generative standalone coal and carbon steel materials business comprising of Glencore’s and Teck’s coal assets, Glencore’s ferroalloys assets and Glencore’s coal and ferroalloys marketing businesses.

 

SA Economy:

The Absa Purchasing Managers’ Index fell further to 48.1 points in March 2023, down from 48.8 in the previous month, as business conditions continued to deteriorate due to prolonged rotational power cuts.

The South African Revenue Service (SARS) said that they have collected R1.686 trillion ($94 billion) in tax revenue for the fiscal year that ended 31^st  March, falling just short of the government’s R1.692 trillion estimate in the 2023 budget. SARS said mining volumes had decreased in the last year, but higher commodity prices contributed significantly to the improved tax receipts.

 

Global Economy:

The S&P Global/CIPS UK Manufacturing PMI came in at 47.9 in March 2023, down from February’s seven-month high of 49.3.

The US March ISM Manufacturing index fell to 46.3 from 47.5.

More economic data in the US to be released this week, which includes JOLTS, ADP employment and the all-important Non-Farm Payrolls.

 

Global Company:

The FTSE 100 closed 0.37% higher at 7 673.

The unexpected production cut of 1 million barrels per day by OPEC, caused the share prices of Shell, BP and TotalEnergies to gain around 4%.

The Hang Seng Index is lower by 1.03% to 20 195, healthcare, tech, and basic materials drove the losses.

In China, the Shanghai Composite is up 0.3% to 3 306.

The Dow Jones Industrial Average closed 0.97% higher to 33 601, while the S&P 500 was up 0.37% to 4 124.

The S&P 500 energy sector index rose 4.9% with Chevron Corp, Exxon Mobil Corp and Occidental Petroleum Corp all rallying more than 4%.

Tesla shares fell 6% after the company said it had missed first-quarter deliveries estimates. Tesla delivered 422 875 vehicles compared with analyst expectations for 430 008 vehicles.

 

Commodities:

Gold is up 0.72% to $1 983/oz, while Platinum is lower by 0.73% to $986.90/oz.

Brent crude was 2.16% higher at $85.48 a barrel.

 

Currencies:

The rand traded at R17.88 against the US Dollar, R22.16 against British Pound and R19.45 against the Euro.

The Euro is slightly firmer against the US Dollar to trade at $1.0855.