Daily Market Overview 15 October 2021

We are proud to share our Daily Market Overview with you, ensuring that you do not miss out on any information.

Local Market Update

– Stocks advanced, with the Johannesburg Stock Exchange’s Top-40 Index rising 1.47% to 60,391 points and the broader All-Share Index climbing 1.26% to 66,846 points. Miners topped the blue- chip index for the second day in a row as gold continued to rise to a one-month high. Platinum and other precious metals were also on the up. Impala Platinum was the biggest winner, rising 4.42%, followed by Glencore, Anglo American and BHP Group, all up more than 3%.

– The rand was steady against the dollar on Thursday, taking a breather after two days of strong gains. At the close of the session, the rand was trading around R14.78 to the dollar or 0.21% firmer. This week the rand has been boosted by market bets that the South African central bank would raise its main lending rate at its next monetary policy meeting in November, as well as an increase in the gold price XAU= and demand for local bonds.

– Gold was set for its best week in more than five months as a retreat in the U.S. dollar and Treasury yields lifted the metal’s appeal despite a looming Federal Reserve taper. Oil prices climbed earlier today, heading for gains of more than 2% for the week, on increasing signs of tight supply over the next few months as rocketing gas and coal prices stoke a switch to oil products. The International
Energy Agency on Thursday said the energy crunch is expected to boost oil demand by 500,000 barrels per day (bpd).

In Local news

PSG GROUP LIMITED – Unaudited financial results
At 31 August 2021, PSG Group’s net asset value per share was R110,09, representing an increase of 50% and 20% when compared to the net asset value per share of R73,27 and R91,76 as at 31 August 2020 and 28 February 2021, respectively; and sum-of-the-parts (“SOTP”) value per share was R110,50, representing an increase of 17% when compared to the R94,24 per share as at 28 February 2021. At 8 October 2021, PSG Group’s SOTP value per share was R112,13. For the six months ended 31 August 2021, PSG Group’s headline earnings per share amounted to R18,04 (2020: loss of R14,14) and fair value gains on investments at fair value through profit or loss amounted to R3,4bn (2020: loss of R5,2bn).

LONG4LIFE LIMITED – Results for the six months ended 31 August 2021
Group revenue of R1.8 billion was in line with the 2019 period, and gross profit of R771 million is a 7% increase on the 2019 period’s R719 million. Trading profit of R214 million exceeded the 2019 period by 6% with improved trading margins of 11.6% (Aug 2019: 10.9%). Headline earnings of R143.1 million translated into a 55% increase in headline earnings per share (‘HEPS’) of 22.5 cents from 14.5 cents in the 2019 period. HEPS is calculated on a weighted average number of shares in issue of 636.6 million (Aug 2019: 875.2 million shares).

International Market Update

– European stocks closed higher on Thursday as investors around the world reacted to recent inflation data and U.S. gains. The pan-European Stoxx 600 climbed 1.2% by the close, with the commodities sector leading the gains with a 3.3% gain, while all sectors closed in positive territory. Among individual stocks, shares of SoftBank-backed UK e-commerce company THG climbed 10.6%, trying to recover from a sharp drop earlier in the week after a capital markets day backfired.

– U.S. stocks rebounded Thursday after better-than-expected earnings reports from Walgreens Boots Alliance, UnitedHealth, Bank of America and other major companies. The three averages are now on track to finish the week higher, with the S&P 500 and Dow about 2% off their record highs and the Nasdaq Composite about 4% behind. Third-quarter earnings season opened before the bell on Thursday with the release of financial results from several major banks and Dow members. Eight companies in the S&P 500 reported their results this morning, and all eight beat Wall Street’s expectations for earnings per share.

– Stocks in the Asia-Pacific region rose in early morning trading after gaining overnight on Wall Street, with the S&P 500 jumping nearly 2 percent. Stocks in Hong Kong returned to trading on Friday after the city’s stock markets were closed for two days.

In International news

Bank of America beats estimates on reserve release
Bank of America on Thursday reported its third-quarter results that beat analysts’ expectations as it benefited from better-than-expected loan losses and record-high advisory and wealth-management fees. The company’s profit jumped 58% to $7.7 billion, or 85 cents a share, while revenue rose 12% to $22.87 billion. The results were helped by a $1.1 billion reversal of provisions, which led to a $624 million increase after write-downs. Net interest income, a metric closely watched by banks, rose 10% to $11.1 billion, beating the StreetAccount estimate of $10.6 billion.

Wells Fargo: profit jumps nearly 60% in quarter
Wells Fargo posted a jump in third-quarter profit Thursday, boosted by the release of loan-loss provisions as its recovery from the 2021 coronavirus pandemic accelerated. Net income was $5.1 billion, up 59% from $3.2 billion in the year-ago quarter. The result was helped by a $1.65 billion reversal of provisions, resulting in a $1.4 billion gain after write-downs, the bank said. Wells Fargo continued to liquidate funds it had set aside during the pandemic to hedge against widespread loan defaults.