Daily Report 17 August 2022

SA Company News:

The Johannesburg Stock Exchange All-Share Index was higher by 1.1% to the 71 505 level. Old Mutual shareholders approved the broad-based black economic empowerment (B-BBEE) ownership scheme. In terms of the scheme, qualifying black South Africans, including lower-income earners and Old Mutual employees will now be able to buy shares at relatively low prices through its newest black empowerment-focused ownership scheme called Bula Tsela. The scheme is scheduled to be fully implemented by the end of December. HomeChoice, a loan provider and seller of homeware products, has reported a 33% increase in its lending for the six months end-June, with loans reaching R2.1 billion. The company’s total earnings per share jumped by 25% to 144 cents. The retail business’ operating profit increased by 19% to R38 million. HomeChoice has declared an interim dividend of 64 cents per share, up from 47 cents in 2021. Mondi Plc. has said that it is buying the Duino mill in Italy from the Burgo Group for a total consideration of €40m. The Duino mill is located near Trieste Italy, and it is a strategic asset to own considering its proximity to two important export harbours, with Mondi highlighting that it is ideally located to supply its Corrugated Solutions plants in Central Europe and Turkey. In a trading update from Exxaro, the company said that its headline earnings per share (HEPS) for the six-month period ended 30 June 2022, is expected to increase between 18% and 32% compared to the six-month period ended 30 June 2021. The company, which is due to release interim results tomorrow, said the jump in earnings is mainly due to the exceptional performance of its coal business driven by higher sales prices and higher sales volumes.

SA Economy:

The Government has announced a national ban on moving cattle to curb the spread of foot-and-mouth disease. The Agriculture, Land Reform and Rural Development, Minister Thoko Didiza said that cattle may not be moved from one property to another for a period of 21 days and that the suspension will be reviewed weekly. ABSA’s economic activity tracker showed that SA’s third-quarter economic activity started off on a strong note, as spending data, which measures all the bank’s transactions using credit and debit cards, rose 4.3% month on month in July after rising 1.2% in June. ABSA’s economic activity tracker is an early indication of what to expect regarding economic growth. Investors will now look to the June retail sales figures due later today for further clues about the country’s second-quarter performance.

Global Economy:

The FOMC will publish the minutes from its policy meeting in July later today, the minutes will be closely watched for signals on the Fed’s next move. The annual inflation rate in the UK increased to 10.1% in July, from 9.4% in June, slightly above market forecasts of 9.8%. UK’s Bank of England (BoE) said that they are seeing inflation peaking at 13.3% in October and projecting the country to enter a recession in the fourth quarter and lasting for five quarters. Global Company: The FTSE 100 closed 0.36% higher at 7 536, as miners rallied after strong results from the BHP Group.The Hang Seng Index is up 0.67% to 19 963. Food delivery company, Meituan rebounded 4.6%, after falling 9% the previous day, on reports that Tencent is planning to sell most of its $24 billion stake in the company. In China, the Shanghai Composite is higher by 0.22% to 3 285, with technology and energy stocks leading the gains. The Dow Jones Industrial Average rose by 0.71% to 34 152 while the S&P 500 climbed 0.19% to 4 305. Walmart shares rose 5% to $139.37, after the retailer reported fiscal second-quarter profit and revenue that beat Wall Street’s expectations while raising its full-year earnings outlook. Home Depot’s (HD) reported second-quarter results that topped Wall Street’s estimates, as the demand for home improvement remained strong despite the high inflationary environment. Shares of the company jumped 4.1%.


Gold is down 0.09% to $1 778/oz, while Platinum is higher by 0.99% to $936/oz. Brent crude was 0.65% lower at $93.20 a barrel.


The rand traded at R16.40 against the US Dollar, R19.88 against British Pound and R16.67 against the Euro. The Euro moved closer to the key $1 dollar parity on mounting worries that the Euro Area economy is heading into a recession. The Euro is trading weaker against the US Dollar at $1.0168.



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Market Indicators

Commodities $ Cross Currencies ($) Major Indices
Gold 1778.27 -0.09% USD/ZAR 16.40 Top40 64726.00 1.09%
Platinum 936.60 0.99% GBP/ZAR 19.88 Dow 30 34152.01 0.70%
Brent 93.20 -0.65% EUR/ZAR 16.67 S&P 500 4305.20 0.19%
Copper 3.63 0.03% EUR/USD 1.0168 FTSE 7536.06 0.36%
Palladium 2156.77 1.22% USD/JPY 134.52 DAX 13910.12 0.67%
Iron Ore 108.50 -0.92% BITCOIN 24361.90 Shanghai 3290.87 0.40%
Source:  Moneyweb & Investing.com