25 June 17:48
Crookes Brothers back in the black
In a trading update for the year to end-March, the agricultural company Crookes Brothers says its headline earnings per share will be between 262.2 cents and 282.2 cents - from a loss of 48.5 in the previous year.
The earnings increase is driven mainly by an improved performance in the groups sugar cane, deciduous fruit and macadamia operations and a reduction to the group's effective tax rate, the company says.
25 June 15:15
Wescoal eyes more business with Eskom
Wescoal narrowed its losses in the full 2021 financial year, but the coal producer saw lower sales volumes during period due to muted domestic demand.
The company reported a loss of R36 million in the year to end of March, down from the R136 million incurred in the previous year.
Although the sales target was lower, deliveries to Eskom, which is the company's major client, increased to R2.1 billion from R1.6 billion in 2020, thanks to its Moabsveden coal sale agreement.
Moabsvelden was a greenfield project in Mpumalanga developed in 2020, and the majority black-owned company previously said it expects it to supply three million tons a year of coal to Eskom's Kusile power station.
25 June 15:14
Steinhoff posts rise in profits, but says it may not survive without settlement deal
Steinhoff’s share price rose 2% on Friday after the company delivered its latest set of results for the six months to end-March.
The company – which owns two-thirds of Pepkor (Pep and Ackermans), a stake in the listed Eastern European cut-price retailer Pepco, the US mattress group Mattress Firm, along with other assets - saw its total revenue from continuing operations increased by 4% to €4 497 million, while its EBITDA (a profit indicator) rose by 7% to €686 million.
Pepco, which owns Poundland in the UK as well as the Dealz chain in Eastern Europe, delivered a 17% increase in underlying profit – despite lockdowns in Europe.
But Steinhoff’s current debts continue to exceed its total assets, with its net debt at €9.8 billion (~R165 billion) at the end of March, from €9.5 billion a year before. However, since the end of March, Pepco listed on the Warsaw Stock Exchange, which raised proceeds of approximately €1 billion for the group - most of which was used to reduce debt.
While the board said it is satisfied that Steinhoff will be able to operate within the levels of its facilities and resources for the foreseeable future, it added that there is "significant doubt" that it could continue as a going concern after December if its agreement with claimants does not go through.
25 June 15:12
JSE warns of profit knock
In a trading update for the six months ending 30 June, the JSE warned that its headline earnings will be between 24% and 32% lower than in the same period in the previous year.
This was partly due to the impact of the stronger rand, which impacted market data revenues and other income from forex cash holdings .
The company also saw a significant reduction in net finance income owing to lower interest rates, and also had technology expenditures associated with its mainframe migration.
The JSE's share price was down 1% to R112.32 in late trading on Friday.
25 June 10:10
Rand strengthens after tough week
After spiking to almost R14.40 earlier this week, the rand strengthened to R14.12/$ on Friday morning.
The dollar continued to retreat, as the reflation narrative ran out of steam, Citadel said in a note. "It is apparent that the Fed merely signalled the chance of higher-than-expected inflation and that no active steps are on the cards to counter it just yet".
The JSE's All Share Index was almost half a percentage stronger in early trading.
On Thursday, Old Mutual surged 6.1%, after the company announced plans to return more than R10 billion to its shareholders through the unbundling of its stake in Nedbank.
Asian markets closed higher on Friday as investors cheered news that Washington had reached an agreement over massive infrastructure spending plans.
The benchmark Nikkei 225 index rose 0.66%, or 190.95 points, to 29,066.18 while the broader Topix index added 0.80%, or 15.55 points, to 1,962.65.
Global shares soared the previous day as US President Joe Biden announced that he and a bipartisan group of lawmakers reached an agreement on huge plans to upgrade America's roads, bridges and broadband, among other items.
The news lifted New York shares, with the S&P 500 and Nasdaq marking new record finishes.
24 June 15:04
Kumba profit more than doubles
Anglo American subsidiary Kumba Iron Ore expects to see a jump of 150% in earnings to around R12.6 billion, as the company continues to benefit from higher commodity prices.
Kumba will release its interim financial statements on 27 July 2021."The period under review has to date seen higher average export iron ore prices and a stronger rand/dollar exchange rate relative to the comparative six months ended 30 June 2020," the company said.
Iron ore prices have skyrocketed in recent months, driven by strong global demand and the recovery of economies from the Covid-19 pandemic, particularly China, which is the top importer.
Kumba's share price gained almost a percent to R622.30 in early afternoon trading.
24 June 09:57
Old Mutual share price rockets after Nedbank announcement
Old Mutual's share price jumped by almost 6% to R13.65 in opening trading on Thursday.
The company yesterday announced that it would unbundle another 12% of its stake in Nedbank to shareholders.
For every 100 Old Mutual ordinary shares, shareholders will receive one Nedbank share and a fractional entitlement to 0.31954 of a Nedbank share.
Old Mutual said in a statement that this will help to "simplify" the group, "allowing investors to focus on the core operations of Old Mutual". Also, it will allow shareholders "to participate more directly in the differentiated investment cases of Old Mutual and Nedbank". Old Mutual will be left with a 7% share in Nedbank.
In 2018, Old Mutual unbundled 33% of its 53% stake in Nedbank to shareholders.
The rand was last at R14.26/$, with the JSE's all share index flat 65 783 points.
Meanwhile, European stocks advanced in opening deals on Thursday, ahead of an interest rate decision from the Bank of England.
London's benchmark FTSE 100 index gained 0.2% to 7 090.18 points, with the BoE widely forecast to hold rates at a record low 0.1% at 1100 GMT. In the eurozone, Frankfurt's DAX 30 climbed 0.5% to 15 530.31 points and the Paris CAC 40 also won 0.5% to 6 586.25.
Asian equities meanwhile traded mixed as investors took a breather after the latest rally, while they try to assess when the Federal Reserve will begin to wind down its vast monetary easing programme.
- AFP and Fin24
23 June 17:32
Nedbank profit to double
In a trading update for the six months to end-June, Nedbank says its headline profit will increase by more than 100% compared to the same period last year. It will also resume dividend payments when its interim profit is announced.
The group recorded a "material reduction" in bad debt write-offs, and says that its credit loss ratio – impairments as a percentage of loans – has remained below 110 bass points.
While this is a very encouraging start to the year, it is too early to reduce our full year guidance for the CLR, given the uncertain outcome of the third wave of Covid-19 infections, risk of a delay in vaccine supply and the slow rollout thereof.
The bank says that client demand for home loans remains strong, and there has been an increase in unsecured lending (via the group’s expanded digital channels), notwithstanding lower loan approval rates due to tighter credit criteria. Growth in net interest income will be around 3%.
23 June 16:08
US indices rise at open as rally continues
Wall Street opened higher on Wednesday, continuing a rally that began earlier in the week as traders bet that inflation was less of a threat than once feared.
Investors have been divided for months over whether the US economy's reopening would cause persistent price increases, and a combination of new data and a shift in Federal Reserve sentiment appears to have convinced them inflation will be temporary.
About 15 minutes into trading, the broad-based S&P 500 was up 0.1% at 4 249.90. The tech-rich Nasdaq Composite Index added 0.3% to 14 290.21, building on Tuesday's record close. The benchmark Dow Jones Industrial Average was flat at 33 942.77.
23 June 12:43
Inflation hits 30-month high
Annual consumer inflation has reached its highest level in 30 months, rising to 5.2% in May from 4.4% in April, Statistics SA reported on Wednesday.
This was due in part to large increases in food and non-alcoholic beverage prices, which rose by 6.7% year-on-year.
But it was also because of base effects: inflation a year ago was very low because of weak demand and a slump in oil prices during stricter lockdown regulations across the world.
23 June 09:32
Renergen asks for trading halt ahead of announcement
Renergen has requested an immediate trading halt in its shares, until 24 June 2021, pending an announcement regarding a capital raise.
"The company is raising the proceeds for the completion of the Phase 2 studies of the Virginia Gas Project, [and to] build up additional financial resources following delays suffered last year as a result of the wide-scale lock-downs and to bolster the already successful drilling campaign." Renergen, the only on-shore gas producer in SA, is currently exploring for gas and helium in the Free State. An announcement about the capital raise will be made before trading resume on 25 June.
23 June 07:57
Market rally boosts Old Mutual profit
In a trading update, Old Mutual said its profitability has been bolstered by higher asset-based fees due to an increase of 13% in average funds under management. Its FUM at the end of May was 17% above May 2020. After sharp falls at the start of global lockdowns last year, share markets have rallied hard over recent months.
The JSE’s All Share Index gained more than 40% in the year to May. Old Mutual says its life insurance [annual premium equivalent] sales were 6% ahead of the prior year, while single-premium annuity sales were above 2019 levels. Its Wealth Management business delivered “significant fixed bond sales” and higher risk sales were recorded in China. These were partially offset by lower umbrella and risk sales in Old Mutual Corporate.
Its “results from operations” – an indicator of profitability - grew by 52% in the year to end-March.
23 June 07:37
Nasdaq at new record as Wall Street gains
The Nasdaq powered to a fresh record Tuesday as Wall Street rallied for a second straight session on fading worries about shifting US monetary policy.
The tech-rich Nasdaq Composite Index climbed 0.8 percent to 14,253.27, easily topping a record set earlier this month.
The Dow Jones Industrial Average gained 0.2 percent to 33,944.58, while the broad-based S&P 500 advanced 0.3 percent to 4,246.44.
22 June 15:15
Bitcoin drops below $30,000 for first time since January
Bitcoin’s decline amid a crypto crackdown from China has pushed it below $30,000 for the first time since January, nearly pulverizing its entire 2021 gain.
The original cryptocurrency has lost roughly 50% from its mid-April high of around $64,000, leaving it up just 5% for the year. That compares with a 12% gain for the S&P 500 since the end of December.
The coin started 2021 trading around $29,000.It’s a remarkable comedown for the digital asset which just weeks ago was trekking higher amid a warmer embrace from Wall Street as well as retail investors. But negative press about its energy use, brought on largely by Tesla Inc.’s Elon Musk, as well as a clampdown from China have pushed it lower in recent weeks.
22 June 14:23
Aluminium is outperforming copper as China cracks down on prices
Aluminium has overtaken copper as the second-best performer on the London Metal Exchange this year as a tight global market helps to offset worries about China’s planned release of strategic reserves.
Prices for the metal used in cars and cans are up more than 21% this year on the LME, compared with an 18% gain for copper and 48% for leading performer tin. Copper and aluminium have both been buffeted by China’s efforts to tame price inflation in commodities markets over the past month, but so far aluminium is proving more resilient as signals from the physical market point to diverging supply conditions.T
hat divergence is highlighted by the premiums paid by buyers to receive metal in the Asian market, which are widely watched as a barometer of spot demand. In Japan, aluminium consumers are paying the biggest surcharges since 2015, while Chinese buyers are enjoying the lowest premiums for copper since at least 2017.
22 June 12:17
Big payouts for Omnia shareholders
Following a successful turnaround at the fertiliser, chemicals and mining explosives producer Omnia, the company has resumed dividends - and is also paying a special dividend. This follows a two-year restructuring process the company undertook to deal with a R7 billion debt pile.
This included a rights offer and various disposals, which has wiped out all its debt. The company now has net cash of R1.3 billion on hand. On Tuesday, the group’s annual results for the year ended 31 March 2021 showed that its operating profit rose by 61% to R1.2 billion from R744 million in 2020. Its revenue from continuing operations remained flat at R17.8 billion.
The group has declared a gross cash dividend of R2 per ordinary share, as well as a special dividend of R4 per ordinary share.
22 June 11:59
China crypto clampdown sends Bitcoin closer to key $30,000 level
China’s intensifying cryptocurrency crackdown has left Bitcoin flirting with $30,000, a price level seen as key to the short-term outlook for the largest virtual currency.
Bitcoin fell as much as 4.3% Tuesday to $31,171, and for some a breach of $30,000 would hurt sentiment and raise the risk of a steeper selloff. It was trading at $32,850 as of 8 a.m. in London.
“We’re most likely going to continue to trade within the $30,000 to $40,000 range and, hopefully, $30,000 will hold as the low of the year,” said Antoni Trenchev, co-founder of crypto lender Nexo in London. “If not, we should revisit $25,000 and even $20,000 before the next leg up.”
22 June 09:51
JSE, rand slightly firmer after Wall Street rally
The rand has recovered a small part of its recent losses on Tuesday morning, last trading at around R14.28/$ - after almost reaching R14.40 on Monday.
The JSE's All Share Index is also slightly higher at 65 695 points in early trading. This is despite more weakness among mining shares, as the meltdown in commodity prices continued.
Naspers and Prosus lost more than 3% of their value in opening trading. Yesterday, their share prices gained following positive results.
22 June 09:47
Wall Street bounces back
Wall Street stocks rallied Monday, staging a strong bounceback from last week's rout that was led by financial, industrial and energy shares."The market is correcting the overcorrection from last week," Maris Ogg of Tower Bridge Advisors said of Monday's session.
The Dow last week suffered its worst week since October 2020, dropping 3.4 percent, due in part to unease at the Federal Reserve's shift towards a more hawkish stance on monetary policy.
But the blue-chip index led the market Monday, winning 1.8 percent to finish at 33,876.97.
21 June 16:12
Dow opens higher, bouncing back from last week's rout
Wall Street stocks mostly rose early Monday, with the Dow bouncing back from last week's rout as markets monitor Capitol Hill talks on a large infrastructure package.
The Dow, which experienced its worst week since October last week as the Federal Reserve shifted to a more hawkish posture, climbed in early trading as investors try to assess the odds Washington will produce a large infrastructure deal.
A bipartisan group of senators is crafting a $1.2 trillion package that could potentially break the logjam on Capitol Hill. But the proposal has garnered a sceptical response from progressive lawmakers who want greater investment.
21 June 15:57
Burger King seller, buyer ‘actively engaging’ commission over blocked deal
Grand Parade Investments said on Monday that the company, as well as the prospective buyer of Burger King South Africa, are “actively engaging” the Competition Commission, following the latter’s decision to prohibit the Burger King takeover due to the buyer’s lack of black shareholding.
Emerging Capital Partners (ECP) – an Africa-focused private equity firm founded in the US – was set to buy the local Burger King franchise (plus a food producer that supplies the chain with patties) from Grand Parade Investments. But the commission halted the sale on public interest grounds, namely that the shareholding of historically disadvantaged persons would drop from nearly 70% to zero.
Competition Commissioner Tembinkosi Bonakele told Parliament's portfolio committee on trade and industry the watchdog had had "no choice" but to block the transaction. He described the public interest issue as "glaring".
Grand Parade also said in a statement that the dates for the fulfilment or waiver of the transaction conditions have been extended to 19 July 2021. “Shareholders will be further updated in due course.”
21 June 12:33
Gold suffered biggest weekly loss in 15 months, but some investors lured back
Gold climbed higher amid investor buying following the biggest weekly decline in 15 months.
Prices slumped to the lowest since April after policy makers at the Federal Reserve brought forward their expectations for when monetary tightening would start. That prompted exchange-traded funds to add the most gold in three months on Friday, according to an initial tally by Bloomberg, a sign some investors saw bullion’s decline as a buying opportunity.“Technically, gold was massively oversold, which would bring in the professionals, and retail interest in south-east Asia had been picking up on an underlying basis already,” said Rhona O’Connell, an analyst at StoneX.
The focus will now turn to speeches by Fed officials for more clues on the direction of monetary policy. Chairman Jerome Powell is due to testify on Tuesday at a House Subcommittee hearing on the Fed’s pandemic emergency lending and its asset purchase programs.
21 June 12:16
European markets hit by interest rate fears
Europe's stock markets swung lower Monday on growing expectations the Federal Reserve will begin lifting interest rates as early as next year, dealers said.
In opening deals, London's benchmark FTSE 100 index slid 0.7 percent to 6,969.79 points, compared with Friday's close.Frankfurt's DAX 30 index fell 0.8 percent to 15,325.98 points and the Paris CAC 40 also shed 0.8 percent to 6,515.55, after earlier sharp losses in Asia.
Investors were spooked by comments from St. Louis Federal Reserve President James Bullard that the US central bank could start hiking interest rates as soon as late 2022."Comments from a Federal Reserve official acted to further fan the flames of inflationary fears and deal a blow to markets," said Richard Hunter, head of markets at Interactive Investor."
The observation from James Bullard that inflation was stronger than anticipated and could even result in a 2022 rate hike followed a hawkish switch from the Fed last week, when the likelihood of two interest rate rises in 2023 came to the fore."
21 June 10:07
Japanese market plummets
Tokyo's key Nikkei index plunged more than 3.2 percent on Monday, tracking losses on Wall Street as investors digested Federal Reserve messaging on more restrictive monetary policy.
The benchmark Nikkei 225 index fell 3.29 percent, or 953.15 points, to close at 28,010.93 while the broader Topix index lost 2.42 percent, or 47.11 points, to 1,899.45.
21 June 10:07
Prosus, Naspers see strong revenue growth
For the year to end-March, Prosus - which holds a stake of almost 29% in the Chinese tech giant Tencent - reported a 33% increase in group revenues to $28.8bn.
While Tencent saw 38% revenue growth, the Prosus Ecommerce portfolio saw a 54% year-on-year increase in revenue to $6.2 billion, while the portfolio's trading loss shrank from $782 million to $429 million.
Naspers, which owns a controlling stake in Prosus, saw its group revenue growing 32% to $29.6bn, with its trading profit up 45% to $5.6bn.
Naspers reported that its South African Takealot business (Takealot.com, Superbalist and Mr D Food) grew its revenues by 65% to $606m, "while trading losses decreased to near breakeven". Mr D Food's order volumes grew 117%, resulting in a 103% growth in revenues year-on-year.
Fin24 is in the Naspers-owned Media24 stable.
21 June 10:07
Rand continues to bleed
The rand started the week at R14.34/$, from R13.73 a week ago.
The dollar has been rallying after the US central bank indicated last week that it would raise interest rates and end bond-buying sooner than expected.
As the dollar boomed, this has hit the gold price, which was last trading at $1 777 per ounce. Also, platinum and palladium prices have been crushed after the Chinese government announced a crackdown on commodity prices, which will include the release of reserves of key metals, including copper and aluminium, according to Reuters.
Following a big slump last week, mining shares on the JSE continued their losing streak on Monday, with Kumba (-1.5%) taking the biggest hit in early trading. The JSE's All Share Index was down 0.4% in opening trading.
21 June 10:05
Strong cement demand from rural areas, informal sector helps PPC
PPC’s revenue for the past year grew by 3% to R8.9 billion. Cost of sales reduced by 1% to R6.9 billion, while EBITDA increased by 16% to R1.6 billion.
Cement South Africa and Botswana saw a 6% increase in cement volumes driven by sales in the retail sector with robust demand experienced from the rural and informal markets, the company said.
Gross debt ended at R2.6 billion, reflecting a R3.2 billion decline from the comparative period, mainly relating to the removal of the debt liability of R2.5 billion attributable to the DRC which is now treated as a discontinued operation.