Local Market update
Johannesburg-listed stocks fell, ending the day with their biggest monthly drop since the concerns about Chinese growth and a crackdown on tech companies, as well as signals from the U.S. to scale back stimulus measures, weighed on sentiment. The benchmark all-share index fell 0.13% to 64,282, ending the third quarter of the year with a monthly decline of 4.96%. The blue-chip index of the 40 largest companies fell 0.27% to 57,863 points. South African miners and technology investor Naspers, which indirectly owns about 30% of China’s Tencent, are among the main companies that have dragged the indexes lower this month.
The rand surged on Thursday as the country’s trade surplus rose more than expected last month, lending picked up and the dollar fell in global markets. At the close of trading, the rand was trading around R15.06 to the dollar, up 0.78%. Revenue data showed the trade surplus widened to 42.4 billion rand ($2.8 billion) in August, while economists had expected a surplus of 39.0 billion rand.
Gold prices slipped this morning after hitting a one-week high above the key $1,750 level in the previous session as the dollar rebounded, making the metal expensive for holders of other currencies. Oil prices fell this morning on the prospect that the Alliance of Petroleum Suppliers
(OPEC+) may increase its planned output to improve supply as rising gas prices prompt power producers to switch from gas to oil.
Local News Headlines
Capitec results show recovery – and further growth
Capitec delivered strong results in the six months to August 2021. All metrics applicable to a bank showed a remarkable year-on-year recovery, while shareholders should be very pleased that the numbers that matter to them recovered even faster. CEO Gerrie Fourie even let slip in an online presentation of the results that customer growth and adoption of the Capitec brand was “scary”. Headline earnings per share rose 513% to R34,47 and basic earnings per share rose by the same percentage.
Bidcorp beats hospitality blues
Bidcorp’s results for the financial year to June 2021, released on Thursday, showed a significant recovery from the turmoil of the previous year, when travel restrictions and restaurant closures around the world had severely impacted its business and ability to generate revenue. Earnings per share (Heps) increased by about 22% to almost R8,70 and free cash flow improved from R2,7 billion to R4,7 billion. However, the group is still a long way from the figures it posted before the Covid 19 pandemic broke out. Bidcorp supplies a wide range of food products to restaurants, airlines, hospitals, hotels and other renders catering services in 35 different countries, was hit hard by lockdowns and operating restrictions worldwide during 2020.