Daily Market Review: Aveng, Mpact, Spur, Nedbank

  • Market Overview
  • Editor's Pick

SOUTH AFRICA MARKET REVIEW

  • South African markets closed in the red yesterday, as investors focus on increasing tensions over Russia’s military build-up near Ukraine.
  • Construction companies, Aveng, Raubex Group (JO: RBXJ ) and Murray & Roberts Holdings Ltd (JO: MURJ ) plummeted 18.7%, 6.2% and 1.3%, respectively.
  • Retailers, Cashbuild (JO: CSBJ ), Cie Financiere Richemont SA (JO: CFRJ ) and Massmart Holdings (JO: MSMJ ) shed 3.8%, 3.2% and 2.4%, respectively.
  • On the flipside, gold miners, Gold Fields (JO: GFIJ ), AngloGold Ashanti (JO: ANGJ ) and Harmony Gold Mining surged 11.0%, 8.3% and 6.4%, respectively.
  • Real estate companies, Delta Property Fund (JO: DLTJ ), Emira Property Fund (JO: EMIJ ) and Fortress REIT soared 7.0%, 4.6% and 1.3%, respectively.
  • Platinum miners, Royal Bafokeng Platinum (JO: RBPCBe ) and Impala Platinum (JO: IMPJ ) Holdings advanced 2.1% and 1.9%, respectively.
  • The JSE All Share index declined 0.8% to close at 75,765.16.

UK MARKET REVIEW

  • The UK market finished weaker yesterday, dragged down by broad based losses in travel and leisure stocks amid geo-political tensions between Russia and Ukraine.
  • International Consolidated Airlines Group (LON: ICAG ) S.A., InterContinental Hotels Group (LON: IHG ) and Whitbread (LON: WTB ) plummeted 5.6%, 1.7% and 1.3%, respectively.
  • Financial companies, Barclays (LON: BARC ), Lloyds Banking Group (LON: LLOY ) and NatWest Group (LON: NWG ) plunged 5.1%, 4.2% and 4.1%, respectively.
  • JD Sports Fashion (LON: JD ) shed 3.5%, after the company was fined by the Competition and Markets Authority for breaching the rules around a merger blocked by the watchdog.
  • On the contrary, miners, Fresnillo (LON: FRES ), Antofagasta (LON: ANTO ) and Anglo American (JO: AMSJ ) soared 7.0%, 1.7% and 1.1%, respectively.
  • Tobacco company, British American Tobacco (JO: SNHJ ) added 1.2%.
  • The FTSE 100 index declined 1.7% to close at 7,531.59.

US MARKET REVIEW

  • US markets ended lower yesterday, on worries over an imminent Russian invasion of Ukraine and concerns of inflation and interest rates.
  • Dave plunged 36.9%, after Marshall Wace LLP stated that it no longer has a stake in the company.
  • Cisco Systems (NASDAQ: CSCO ) declined 1.3%, after the company made a $20.00bn offer for software maker, Splunk.
  • Eli Lilly (NYSE: LLY ) & Co. eased 0.5%, even after the US Food and Drug Administration issued an emergency-use authorization for bebtelovimab, the company’s antibody treatment for COVID-19.
  • The S&P 500 index fell 0.4% to settle at 4,401.67, while the DJIA index declined 0.5% to close at 34,566.17.
  • The NASDAQ index marginally eased to end the trading session at 13,790.92.

ASIA MARKET REVIEW

  • Asian markets are trading lower this morning, tracking overnight losses on Wall Street.
  • In Japan, agricultural machinery company, Kubota Corporation has plunged 11.3%.
  • On the other hand, Keisei Electric Railway Co., Ltd. (T: 9009 ) has advanced 2.5%.
  • In Hong Kong, insurance company, China Life Insurance Company (NYSE: LFC ) has shed 2.9%.
  • Meanwhile, pharmaceutical company, WuXi Biologics (HK: 2269 ) has soared 8.1%.
  • In South Korea, electronics company, LG Electronics (KS: 066570 ) has eased 0.4%.
  • On the contrary, beverage company, Muhak Company (KS: 033920 ) has surged 12.5%.
  • The Nikkei 225 index is trading 0.5% lower at 26,953.63.
  • The Hang Seng index has declined 0.7% to trade at 24,396.24, while the Kospi index is trading 0.4% lower at 2,694.72.

COMMODITIES

  • At 06:00 SAST today, Brent spot prices fell 1.5% to trade at $96.18/bl, reversing the previous session’s gains.
  • Yesterday, Brent spot prices rose 0.1% to settle at $97.67/bl, after Ukraine's President, Volodymyr Zelensky declared a "day of unity" for 16 February, which is expected as a possible start of a Russian invasion.
  • Yesterday, the Illinois North Central No.2 Yellow corn spot prices rose 1.1% to $6.39/bushel.
  • At 06:00 SAST today, gold prices advanced 0.3% to trade at $1,877.51/oz. Yesterday, gold gained 0.7% to close at $1,871.18/oz, as a weaker greenback gave a boost to the safe haven yellow metal.
  • Yesterday, copper rose 0.9% to close at $9,984.50/mt. Aluminium closed 3.8% higher at $3,265.75/mt.

CURRENCIES

  • Yesterday, the South African rand strengthened against the US dollar. The International Monetary Fund (IMF) announced that South Africa could lift its economic growth rate above 3.0% within two years if it implements a strong package of reforms and fixes its public finances.
  • The yield on benchmark government bonds mostly rose yesterday. The yield on 2026 bond rose to 7.76%. Further, the yield on 2023 bond declined to 5.34%, while that for the longer-dated 2030 issue rose to 9.20%.
  • At 06:00 SAST, the US dollar is trading 0.5% lower against the South African rand at R15.0585, while the euro is trading 0.4% lower at R17.0437. At 06:00 SAST, the British pound has declined 0.4% against the South African rand to trade at R20.3865.
  • Yesterday, the euro declined against most of the major currencies. In the eurozone, the European Central Bank (ECB) President, Christine Lagarde stated that the bank will take action at the right time to achieve its 2.0% inflation goal, adding that inflation is likely to remain high and bottlenecks will still persist for some time. The ECB views the risks to the economic outlook as broadly balanced. However, risks to the outlook for inflation are tilted to the upside. although inflation is expected to decline over the course of the year.
  • At 06:00 SAST, the euro advanced 0.1% against the US dollar to trade at $1.1318, while it has marginally gained against the British pound to trade at GBP0.836.

ECONOMIC UPDATES

  • The producer and import price index advanced 0.6% in Switzerland on a MoM basis, in January. In the previous month, the producer and import price index had registered a drop of 0.1%.
  • In 4Q21, on a QoQ basis, the flash annualized gross domestic product ( GDP ) recorded a rise of 5.4% in Japan, less than market expectations for a rise of 5.8%. In the previous quarter, annualized GDP had fallen 3.6%.
  • In 4Q21, on a quarterly basis, the flash nominal GDP in Japan advanced 0.5%. In the previous quarter, nominal GDP had fallen 1.0%.
  • REINZ house sales in New Zealand slid 28.6% in January on an annual basis. In the prior month, REINZ house sales had dropped 29.4%.

CORPORATE UPDATES

SOUTH AFRICA

  • Shoprite Holdings Ltd (JO: SHPJ ): The retail company, in its 1H22 trading update, indicated that it expects its basic EPS to be between 471.90c and 495.10c as compared with 386.10c reported in the corresponding period of the previous year. It expects its basic HEPS to be between 519.30c and 543.70c as compared with 406.40c posted in the same period of the prior year.
  • Nedbank Group (JO: NEDJ ) Limited: The bank company, in its FY21 trading statement, reported that it expects its basic EPS to be between R22.80 and R23.52 as compared with R7.17 recorded in the previous year. It expects its diluted HEPS to be between R23.42 and R24.55c as compared with R11.26 recorded in the previous year.
  • Mpact Limited (JO: MPTJ ): The paper and packaging company, in its FY21 trading statement, reported that it expects its EPS to be between 340.00c and 360.00c as compared with 188.60c recorded in the previous year. It expects its diluted HEPS to be between 330.00c and 350.00c as compared with 196.10c recorded in the previous year.
  • Aveng Ltd (JO: AEGJ ): The construction company, in its interim trading statement, reported that it expects its diluted EPS to be between 35.00c and 44.00c as compared with 909.00c recorded in the previous year. It expects its diluted HEPS to be between 11.00c and 14.00c as compared with 226.00c recorded in the previous year.
  • Spur (JO: SURJ ) Corporation Limited: The restaurant company, in its 1H22 trading update, indicated that it expects its diluted EPS to be between 69.20c and 70.80c as compared with 31.89c reported in the corresponding period of the previous year. It expects its diluted HEPS to be between 69.18c and 70.77c as compared with 31.88c posted in the same period of the prior year.
  • Oil steady after hitting seven-year highs: Oil prices were steady after hitting their highest in more than seven years on fears that a possible invasion of Ukraine by Russia could trigger US and European sanctions that would disrupt exports from one of the world’s top oil producers.

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