Daily Market Overview 16 September 2021

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Local Market Update

– Johannesburg-listed stocks inched up on Wednesday, but slowing Chinese factory output and retail
sales kept gains in check as elsewhere on global equities markets. The fortunes of some
heavyweight South African companies such as tech investor Naspers, luxury goods maker
Richemont and mining firms are inextricably linked to China. Trading on the Johannesburg Stock
Exchange was subdued for much of the day but two key indices ended in positive territory: the
blue-chip Top-40, which closed up 0.2% at 58,230 points, and the All-share index, which ended up
0.13% at 64,385 points.

– The rand fell on Wednesday as a drop in retail sales added to evidence that riots and tight COVID19 restrictions dealt the economy a severe blow at the start of the third quarter. At the close, the
rand was trading around R14.41 to the dollar or 0.57% softer.

– Gold prices were steady this morning as investors awaited signals on the Federal Reserve’s timeline
for tapering pandemic-era stimulus measures, after softer-than-expected U.S. inflation data fuelled
some uncertainty. Oil prices slipped earlier today, but kept most of the previous day’s gains after a
larger-than-expected drawdown in crude oil stocks in the United States, the world’s largest oil
consumer.

In Local news

Impact of Covid-19 pandemic on Hyprop is diminishing
Hyprop’s distributable income performance improved by 19% in the second half of its financial
year compared to the first half. This was led by the South African portfolio, which achieved R571
million of distributable income in the second half compared to R470 million in the first half. The
increase in the number of ordinary shares in issue by 21% to R53 million from support for the
‘dividend reinvestment alternative’ in the 2020 financial year, which raised R77 million in equity,
and the accelerated book build in April 2021 that raised R358 million, contributed to the decrease
in distributable income per share.

SA’s largest JSE-listed property fund declares full-year dividend
Growthpoint Properties – South Africa’s largest JSE-listed real estate income trust (Reit) with
investments locally, as well as in Australia and Europe – is continuing to pay out dividends to
shareholders even in the face of the continued impact of the Covid-19 pandemic. The group on
Wednesday declared a final dividend of 60 cents per share (cps) for its full-year ended June 30,
2021. Despite a sharp drop in DPS and Dips, the group reported a 6.2% increase in overall revenue
to R13.13 billion, compared with R12.36 billion for the prior comparative period. Operating profit
increased by 6.2% to R9.08 billion, while its headline earnings per share increased by 112.7% to
169.98 cents compared with 79.93 cents for the comparative period.

International Market Update

– European markets closed lower on Wednesday as traders reacted to economic data out of the U.K.
and China. The pan-European Stoxx 600 provisionally ended Wednesday’s session down 0.7%, with
utilities shares dropping 2.7% to lead the losses as most sectors and major bourses dipped into the
red. U.K. inflation soared to a nine-year high in August, with consumer prices rising 3.2% year-on-year after a 2% annual rise in July, according to the Office for National Statistics. The 1.2 percentage
point incline was the sharpest since records began in 1997.

– The Dow Jones Industrial Average rebounded Wednesday after a string of negative trading sessions
this September. Some bullish economic news released before the bell Wednesday helped stabilize
investor sentiment. The New York Fed’s Empire Index, a measure of manufacturing in the region,
came in at 34.3 for September, way ahead of the 18 consensus estimate from FactSet. It marked an
acceleration from August. Rising U.S. Treasury yields helped lift bank stocks, with Citigroup up 2.4%
and Morgan Stanley 1.1% higher. Higher interest rates typically boost bank profits.

– Shares in Asia-Pacific were mixed in early morning trade, with casino shares in Hong Kong mostly
seeing another day of losses. Australia’s unemployment rate decreased to 4.5% on a seasonally
adjusted basis in August, data released Thursday showed, lower than the 4.9% forecast in a
Reuters poll.

In International news

Bitcoin protests in El Salvador
Thousands of protesters have taken to the streets in El Salvador, angry at the introduction of
Bitcoin as its legal tender. President Nayib Bukele says the cryptocurrency will help Salvadorans
working abroad to send money back home. But demonstrators fear it will bring instability and
inflation to the impoverished Latin American country. Some protesters set fire to a brand-new
Bitcoin machine, while others held signs reading “Bukele Dictator”. Last week, El Salvador became
the first country to use the virtual currency as a legal tender, alongside the US dollar.

Canva: Australian online design platform valued at $40bn
Australian graphic design business Canva has become one of the world’s biggest privately-owned
companies after being valued at $40bn (£29bn). The online design platform said it had grown
during the pandemic as more customers worked from home. It has revealed a fresh $200m round
of private equity investment – more than doubling the company’s value in five months.