Daily Report 28 October 2022

SA Company News:
The Johannesburg Stock Exchange All-Share Index closed flat at the 67 123 level.
Afrimat Limited reported interim financial results for the period ended 31 August 2022. The company said that group revenue increased 7.2% to R2.6bn and cost of sales increased 14.2% to R1.73bn. Afrimat generates most of its revenue from bulk commodities (52.14%), construction materials (35.32%) and industrial minerals (11.28%).
The company kept its interim dividend unchanged at 40c, despite a drop in profit in its interim results.
Anheuser-Busch InBev reported higher-than-expected quarterly earnings as beer sales accelerated, and also raised its 2022 outlook to the top-end of its previous forecast range. AB InBev, the maker of Budweiser, Corona and Stella Artois, sold 3.7% more beer and other drinks during the July toSeptember period, a growth rate faster than that seen in the first or second quarters, with strong expansion in Mexico and South Africa. The company said that third-quarter core profit earnings before interest, tax, depreciation, and amortisation rose 6.5% on a like-for-like basis to $5.31 billion, above the 5.2% climb forecasted by analysts. The company said it now expects its core profit to rise by between 6% and 8%. It had previously given a range of 4% to 8%, which it maintains as a medium-term outlook.
In a trading update from Astral Foods, the company said that headline earnings per share is expected to increase between 118% and 128% compared to the prior comparable year. This implies that headline earnings per share is expected to be between 2 677 cents and 2 799 cents per share (30 September 2021: 1 228 cents per share). The earnings growth is measured against a low base in the prior comparable year that was severely impacted by COVID-19 related lockdowns that adversely affected the South African economy and poultry consumption patterns. Astral Foods shares fell more than 10%, after it warned that the next few months will be tough as it deals with load shedding and surging feed costs.
Impala Platinum said in a trading update, that load shedding contributed to a 5% fall in its production in its first quarter to end-September. However, Impala expects revenue to remain robust.
Tongaat Hulett was placed in business rescue as the company has more than R6.3bn in excess debt that it cannot repay, which is increasing as interest mounts.

SA Economy:
The Producer Price Inflation (PPI) fell for the second straight month to 16.3% in September 2022, from 16.6% in August, but above market estimates of 15.7%. PPI is considered a key indicator of future consumer inflation, and the latest reading suggests a continued squeeze on consumers’ pockets amid weak economic growth, high inflation, and interest rate hikes.
South Africa has secured $500 million (R9 billion) to aid its transition from coal to renewables. The Climate Investment Fund, a multilateral climate fund affiliated with the World Bank, had approved the funding.
The deputy minister in the presidency for State Security, Zizi Kodwa said that there is no immediate threat to national security and that there is no need to panic. These comments came after the US embassy in South Africa issued a terrorism alert on Wednesday.

Global Economy:
The European Central Bank (ECB) decided to raise the key interest rate by 75 basis points, as expected. It was the second consecutive such increase.
The American economy grew at an annualised 2.6% in the three months to end September 2022, rebounding from a contraction in the first half of the year. The figure beat market forecasts of a 2.4% rise.
The Bank of Japan maintained its short-term interest rate at -0.1% and that for 10-year bond yields at around 0% during its October meeting. The Japanese Yen fluctuated near 146 per dollar after the announcement.

Global Company:
The FTSE 100 closed 0.25% higher at 7 073.
Shell PLC reported a fall in third-quarter profit of 18%, but has still beaten market forecasts, and said that they plan to start a $4 billion share buyback program.
Asian equity markets were trading lower on disappointing quarterly results from big US tech companies, and economic concerns stemming from China’s Covid lockdowns.
The Hang Seng Index is lower by 3.45 % to 14 890.
In China, the Shanghai Composite is down 1.73% to 2 931.
The Dow Jones Industrial Average rose 0.61 % to 32 033, while the S&P 500 was lower by 0.61% to 3 830.
Comcast and Mc Donald’s added 1.2% and 3.4%, respectively, following earnings reports that surpassed market forecasts.
Facebook-parent, Meta fell almost 25% after missing earnings estimates and offering weak guidance for the fourth quarter.

Gold is down 0.25% to $1 660/oz, while Platinum is higher by 0.19% to $957.40/oz.
Brent crude was 0.12% lower at $94 a barrel.

The rand traded at R17.98 against the US Dollar, R20.80 against British Pound and R17.96 against the Euro.
The Euro is slightly weaker against the US Dollar to trade at $0.9969.



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Market Indicators

Commodities $ Cross Currencies ($) Major Indices
Gold 1659.67 -0.25% USD/ZAR 17.98 Top40 60470.00 -0.16%
Platinum 957.40 0.19% GBP/ZAR 20.80 Dow 30 32033.28 0.61%
Brent 93.99 -0.12% EUR/ZAR 17.96 S&P 500 3807.30 -0.61%
Copper 3.50 -2.31% EUR/USD 0.9969 FTSE 7073.69 0.25%
Palladium 1954.00 -1.17% USD/JPY 146.51 DAX 13211.23 0.12%
Iron Ore 89.00 -4.49% BITCOIN 20265.10 Shanghai 2924.90 -2.36%
Source:  Moneyweb & Investing.com