South Africa Market Review
- South African markets closed in the red yesterday, led by losses in retail and banking sector stocks and as investors assessed the impact of the Silicon Valley Bank (NASDAQ:SIVB) failure.
- Retailers, Mr Price Group (JO:MRPJ), Cie Financiere Richemont S.A. (JO:CFRJ), Clicks Group (JO:CLSJ) and SPAR Group (JO:SPPJ) shed 4.6%, 3.3%, 1.9% and 1.4%, respectively.
- Lenders, Standard Bank Group (JO:SBKJ), Capitec Bank Holdings (JO:CPIJ), Nedbank Group (JO:NEDJ) and Resilient REIT (JO:RMHJ) declined 3.0%, 2.2%, 2.1% and 1.9%, respectively.
- Property developers, Redefine Properties (JO:RDFJ), Growthpoint Properties (JO:GRTJ) and Resilient Property Income Fund Ltd (JO:RESJ) declined 1.9%, 1.4% and 1.2%, respectively.
- On the flipside, gold miners, Gold Fields (JO:GFIJ) and AngloGold Ashanti (JO:ANGJ) jumped 11.7% and 9.9%, respectively.
- Platinum miners, Northam Platinum (JO:NHMJ), Impala Platinum (JO:IMPJ) and Anglo American Platinum (JO:AMSJ) climbed 6.2%, 5.2% and 3.4%, respectively.
- The JSE All Share index declined 1.2% to close at 75,502.28.
UK Market Review
- The UK market finished weaker yesterday, amid strength in the British Pound and amid sell off in banking stocks.
- Banking firm, HSBC Holdings (LON:HSBA) declined 4.1%, after the company acquired the British subsidiary of SVB for GBP1.00.
- Peers, Standard Chartered (LON:STAN), Barclays (LON:BARC), Lloyds Banking Group (LON:LLOY) and NatWest Group (LON:NWG) shed 6.9%, 6.3%, 5.1% and 4.8%, respectively.
- Retailers, Burberry Group (LON:BRBY), JD Sports Fashion (LON:JD) and B&M European Value Retail S.A. (LON:BMEB) dropped 5.8%, 4.2% and 3.1%, respectively.
- Energy companies, BP (LON:BP) and Shell (LON:RDSa) fell 4.9% and 4.2%, respectively, on weaker oil prices.
- Miners, Glencore (LON:GLEN), Antofagasta (LON:ANTO) and Rio Tinto (LON:RIO) declined 3.0%, 2.6% and 1.5%, respectively.
- Real estate companies, Land Securities Group (LON:LAND), Barratt Developments (LON:BDEV) and British Land Company (LON:BLND) eased 1.9%, 1.7% and 1.2%, respectively.
- The FTSE 100 index declined 2.6% to close at 7,548.63.
US Market Review
- US markets ended mostly lower yesterday, as shutdown of the Silicon Valley Bank (SVB) renewed concerns over financial crisis.
- Financial services company, Charles Schwab Corporation (NYSE:SCHW) plunged 11.6%, after the company reported a 28% decline in average margin balances and a 4% fall in total client assets for February.
- Peers, American Express (NYSE:AXP), Goldman Sachs Group (NYSE:GS), JPMorgan Chase (NYSE:JPM) and Visa (NYSE:V) shed 4.9%, 3.7%, 1.8% and 0.8%, respectively.
- Media and entertainment companies, Warner Bros Discovery and Walt Disney (NYSE:DIS) declined 2.3% and 1.0%, respectively.
- The S&P 500 index fell 0.2% to settle at 3,855.76, while the DJIA index declined 0.3% to close at 31,819.14.
- The NASDAQ index climbed 0.4% to end the trading session at 11,188.84.
Asia Market Review
- Asian markets are trading lower this morning, tracking overnight losses on Wall Street.
- In Japan, financial services company, Sumitomo Mitsui Financial Group (TYO:8316) has shed 7.3%.
- On the flipside, pharmaceutical company, Daiichi Sankyo (TYO:4568) has added 0.8%.
- In Hong Kong, insurance company, AIA Group (HK:1299) has dropped 3.1%.
- On the other hand, real estate company, Sun Hung Kai Properties (HK:0016) has gained 1.8%.
- In South Korea, electronics company, Jahwa Electronics (KS:033240) has plummeted 8.2%.
- On the contrary, chemical company, KG Chemical Corporation (KS:001390) has advanced 2.8%.
- The Nikkei 225 index is trading 2.1% lower at 27,259.40.
- The Hang Seng index has shed 1.8% to trade at 19,337.92, while the Kospi index is trading 2.0% lower at 2,363.21.
Commodities
- At 06:00 SAST today, Brent spot prices fell 1.1% to trade at $79.51/bl.
- Yesterday, Brent spot prices fell 2.4% to settle at $80.43/bl, as the Silicon Valley Bank (SVB) collapsed raised concerns over a possible financial crisis.
- Yesterday, the Illinois North Central No.2 Yellow corn spot prices rose 0.2% to $6.34/bushel.
- At 06:00 SAST today, gold prices declined 0.5% to trade at $1,903.36/oz. Yesterday, gold gained 2.4% to close at $1,913.70/oz, as a weaker dollar and a drop in the US Treasury yields boosted demand for the safe haven yellow metal.
- Yesterday, copper rose 0.8% to close at $8,918.25/mt. Aluminium closed 0.9% higher at $2,283.00/mt.
Currencies
- Yesterday, the South African rand strengthened against the US dollar. In South Africa, the agribusiness confidence index fell to its lowest level since the early days of the Covid-19 pandemic in 1Q23.
- The yield on benchmark government bonds fell yesterday. The yield on 2026 bond fell to 8.40%. Further, the yield on the longer-dated 2030 issue fell to 10.01%.
- At 06:00 SAST, the US dollar is trading 0.2% higher against the South African rand at R18.2301, while the euro is trading 0.1% lower at R19.5134. At 06:00 SAST, the British pound has declined 0.1% against the South African rand to trade at R22.1598.
- Yesterday, the euro mostly advanced against most of the major currencies.
- At 06:00 SAST, the euro slipped 0.3% against the US dollar to trade at $1.0704, while it has marginally weakened against the British pound to trade at GBP0.8806.
Economic Updates
- In Australia, the Westpac consumer confidence index recorded a flat reading in March, compared to market expectations for a rise of 0.1%. In the prior month, the Westpac consumer confidence index dropped 6.9%.
- In Australia, business confidence dropped to a level of -4.00 in February, compared to a level of 6.00 recorded in the previous month.
Corporate Updates
South Africa
- MTN Group Limited (JO:MTNJ): The telecommunications company, in its FY22 results, indicated that revenues rose to R207.00bn from R181.65bn posted in the corresponding previous year. Its diluted EPS increased 40.3% from the prior year to R10.44.
- The Foschini Group Limited (JO:TFGJ): The retail company, in its voluntary trading update in respect of the continued impact of load shedding in South Africa, revealed that for the 2 month period retail TFG Africa’s turnover growth dropped from 12.6% for the nine months ended 31 December 2022. This in turn reduced retail turnover growth for the 48 weeks ended 25 February 2023 to 11.4%. Moreover, TFG Africa lost approximately 120,000 trading hours during the 2-month period due to continued load shedding across all provinces in South Africa.
- Transaction Capital Limited (JO:TCPJ): The investment management company, in its 1H23 trading update, revealed that it expects core EPS from continuing operations to be 20% and 50%, lower as compared with the previous year.
- Sun International Limited (JO:SUIJ): The hotel company, in its FY22 results, reported that its income advanced from the preceding year to R11.30bn. Further, its basic and diluted EPS stood at 222.00c, compared with 105.00c recorded in the corresponding previous year.
- Afrocentric Investment Corporation Limited (JO:ACTJ): The investment company, in its 1H23 results, revealed that its total income rose 1.3% from the same period of the preceding year to R4.34bn. Its diluted EPS stood at 21.27c, compared with 25.91c recorded in the corresponding period of the previous year.
- Grand Parade Investments Limited (JO:GPLJ): The investment company, in its trading update for the period ended 31 December 2022, revealed that it expects its HEPS to be 115.0% and 95.0%, higher as compared with 4.81c recorded in the previous year. Also, it expects its EPS to be 156.0% and 136.0%, higher as compared with 4.03c recorded in the previous year.
- Discovery (JO:DSBPp) still trying to negotiate an affordable price for cystic fibrosis treatment: SA’s most influential medical scheme says it has been negotiating with US pharmaceutical manufacturer Vertex (NASDAQ:VRTX) over the price of its blockbuster cystic fibrosis drug Trikafta for more than three years but is still “nowhere near” reaching an agreement.
- Pan African Resources (JO:PANJ) secures R400.00mn from RMB: Midtier gold producer Pan African Resources has secured R400.00mn from Rand Merchant Bank (RMB), which forms part of the R2.50bn funding package for construction of the Mintails project.