South African Market Overview 9 November 2021

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

 

Local Market Update

  • The local market traded higher yesterday as this month’s upward momentum continued. Both the JSE All Share Index and the Top 40 Index ended the session 0.33% firmer. The commodity sector gave the biggest boost to the overall market as commodity prices continue to rise. Other news: Eskom on Monday announced power outages for the third consecutive week following a drop in power generation in Zambia over the weekend, which impacted the Southern African Power Pool.
  • The rand trended firmer on Monday as investors’ risk appetite improved ahead of Finance Minister Enoch Godongwana’s first medium-term budget speech this week. At the close of trading, the rand was trading R14.92 firmer against the dollar, or 0.77%. The rand has been volatile in recent sessions, with domestic politics and US monetary policy driving price swings.
  • Gold prices were steady this morning, consolidating near a two-month high reached in the previous session as a weak dollar offset firm US bond yields. Oil prices rose for a third straight session today as the passage of a U.S. infrastructure bill, Chinese exports and the global post-pandemic recovery improved the outlook for fuel demand. US President Joe Biden’s long-delayed infrastructure bill, passed by Congress over the weekend, and better-than-expected Chinese exports helped paint a picture of a more expansionary global economy.

In Local News

MTN is said to be making a takeover attempt for Telkom

MTN Group recently made a takeover attempt for Telkom, which would have seen South Africa’s second and third largest telecoms providers merge, according to people familiar with the matter. Telkom has so far shown no interest in a sale, said the people, who wished to remain confidential as the talks are confidential. It remains unclear whether the larger rival will continue its pursuit, the people said. “There is no deal on the table in this matter,” MTN said in a statement when asked by Bloomberg, declining to comment further. A representative for Telkom did not immediately comment.

Redefine pays dividend again

JSE-listed diversified property investment trust (Reit) Redefine Properties officially resumed paying a full-year dividend on Monday. At the same time, Redefine Properties made a surprise announcement that it would take full control of Polish property company EPP and delist the company. In announcing its annual results for the year ended 31 August 2021, the group declared a dividend of 60.12 cents per share with a payout ratio of 100%, unlike many of its Reit peers who have opted for a lower payout ratio as the Covid 19 pandemic continues to impact the commercial real estate sector. This comes after Redefine made the tough decision not to pay a dividend for the 2020 financial year, after the financial impact of Covid-19 was initially tougher in 2020. “Distributable earnings per share for the financial year ending 31 August 2021 were 52.96 [FY20: 51.50] cents, an increase of 2.8% on the prior year,” Redefine noted in its latest earnings announcement Sens.