South African Market Overview 7 March 2022

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

 

Local Market Update

  • The Johannesburg All-Share Index slumped 3.43% to 74,734 points on Friday, while the Top-40 Index fell 3.56% to 68,357 points. The biggest losers were market heavyweights Naspers, which fell 10.64% to its lowest level since October 2018, while Prosus dropped 9.47% to a record low. In fixed income, the yield on the benchmark 2030 government bond rose a single basis point to 9.68%, reflecting slightly weaker prices.
  • The rand weakened Friday, while equities posted their biggest one-day decline since Jan. 24 after Russian invading forces seized Europe’s largest nuclear power plant in Ukraine in what Washington called a reckless attack that risked disaster. At the close of trading, the rand was trading at R15.40 to the dollar, 1.32% weaker. Risk appetite took a toll on markets around the world, while bonds, commodities and crude oil rallied as the escalating war in Ukraine fueled concerns about slowing growth and faster inflation, and investors bought commodities as a hedge.
  • Oil prices rose more than 10% in hectic trading today as the risk of a U.S. and European ban on Russian imports and delays in talks with Iran triggered a major stagflation shock to global markets. Meanwhile, palladium rose to a record high this morning, while gold hit the key $2,000 per ounce level as concerns over the Russia-Ukraine conflict drove investors into safe-haven assets.

 

In Local News

 

M&R’s R61.1 billion order book will boost sales and profits over the next three years 

Daily Market 360JSE-listed multinational engineering and construction company Murray & Roberts (M&R) expects its already substantial R61.1 billion order book to continue to grow, boosting both revenue and profit over the next three years. Group CEO Henry Laas said Thursday that it is a “phenomenal order backlog” and stressed the critical importance of an order backlog for an engineering and construction company. “Without an order backlog, there is no business, so we place great emphasis on our order backlog and pipeline. “We expect revenue and profit to grow over the next three years, and that is supported by the order backlog of 61.1 billion rupees and the upcoming orders of 12.8 billion rupees,” he said.

 

Non-functioning licensing bodies could jeopardize Takatso business from SAA 

Transport Minister Fikile Mbalula’s failure to appoint two key licensing boards, ostensibly to benefit South African Airways (SAA), could come back to haunt the same SAA as it seeks regulatory approval for the sale of 51% of its shares to the Takatso consortium. Very little is known about the contents of the sale agreement, and stakeholders are now taking steps to ensure proper disclosure. The government announced at the end of February that the contract with Takatso had been signed, subject to regulatory approval.