South African Market Overview 1 February 2022

Sharing our Daily Market Overview with you, ensuring that you do not miss out on any important market changes!


Local Market Update

  • Local stocks were boosted yesterday by mobile operator MTN, technology stocks and a rise in commodity prices. The Johannesburg All-Share Index rose 1.16% to 74,304 points, while the Top 40 Index climbed 1.19% to 67,820 points. MTN led the blue-chip index, rising 10.11% to a six-year high. The group’s largest company, MTN Nigeria Communications, reported strong full-year results Friday, with improved margins across the board and a jump in profits.
  • The rand rebounded Monday after weakening last week as the country’s central bank signalled a gradual tightening of monetary policy and expectations for aggressive U.S. rate hikes increased. At the close of trading, the rand was trading 1.17% firmer at R15.37 to the dollar. The local trade surplus narrowed to 30.14 billion rand ($1.94 billion) in December from 35.83 billion rand in November.
  • Gold prices were unchanged this morning as a weaker dollar countered concerns about possible interest rate hikes, while investors awaited a slew of economic data to gauge the strength of global economies. Meanwhile, oil prices edged higher on Tuesday, trading near seven-year highs reached last week, as investors bet that supply will remain tight as major oil producers increase production only on a limited scale and fuel demand recovers strongly after the pandemic.

In Local News

High court dismisses Peter Moyo’s R250 million claim
The Gauteng Local Division of the High Court has ruled that former Old Mutual CEO Peter Moyo failed to produce evidence that Old Mutual did anything wrong in connection with the termination of his employment in June 2019. The court even went so far as to Old Mutual as well as its non-executive directors, who were cited as defendants, absolution from the instance. Old Mutual said in a statement that this relief meant it would not have to name witnesses to testify against Moyo’s claims.

Above-average results in Nigeria send MTN stock soaring
MTN Group’s largest company, MTN Nigeria Communications, has reported strong results for the year ending Dec. 31, 2021, with improved margins across the board and a jump in profits. Operating margins – calculated using earnings before interest, tax, depreciation and amortisation (Ebitda) – rose 2.1 percentage points to 53%. Profit after tax and earnings per share each rose 45.5% to ₦ 298.7 billion (R11.2 billion) and 14.67 kobo, respectively. The company increased its full-year dividend by almost 40% to 8.57 kobo per share. The strong figures, which pushed shares in MTN Group to a nearly seven-year high in Johannesburg on Monday morning, came despite a 10.6% drop in the Nigerian company’s mobile subscriber base caused by regulatory restrictions on the sale and activation of new sims.