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Tuesday, 05 April 2011 - 20:00
Sharenet is pleased to announce the launch of our new publication, The Sharenet Daily. We have built on the success of our Daily Equity Report, while adding more content and helpful information. The result is a publication that gives readers a quick, easy to read and informative synopsis of market activity, company results and news on the JSE for the day, as well as an overview of what transpired on important overseas markets.The Sharenet Daily includes helpful charts that give a graphical impression of events, and our news content is sourced from a number of contributors, including Reuters. In addition, Sharenet's popular price information is available in our Spot Price format which provides a snapshot of the JSE and world indices, currencies and commodities.
All the JSE trading statistics; major movers; latest dividends; upcoming AGM dates and more are provided to insure that you keep abreast of market developments. The Sharenet Daily is published at 8pm each day on the website and also distributed via email for your convenience. As always, we welcome your comments, feedback and suggestions at support@sharenet.co.za
Charts
What will increased interest rates do to risk aversion?
G10 countries are slowly but surely shifting into gear to raise interest rates. Low interest rates have been key to fuelling the global economy and to the lower risk aversion. Higher interest rates tend to increase risk aversion and are therefore typically negative for asset prices.
Today China raised its interest rates again – the fourth increase in 5 months. They increased by 0,25% to help tame inflation.
The European Central Bank is set to raise its interest rates this week. The general consensus is that rates will be hiked by 0,25% on Thursday from a record low 1%.
A Standard Bank report says that the Bank of England (BoE) looks like it may be “dragged kicking and screaming to hike rates.”
The US Federal Reserve still has some time to play with, but increasingly it is being pressured around the fringes of the Board of Governors, to increase interest rates and so tighten monetary policy.
All three of the globes main central banks are now likely to be pushing in the same direction – but there is going to be a big discrepancy in the timing of these hikes.
At this stage, the US Federal Reserve is not overly concerned that higher commodity prices will translate into higher core inflation. Ben Bernanke - the US Federal Reserve Chairman, said that as long as inflation expectations remain stable and well anchored, the increase in inflation caused by higher commodity prices will be transitory.
An increase in risk aversion?
The fixed income research team from Standard Bank does not believe that at this stage higher interest rates will spark increased risk aversion.
Their reasoning is that this is only likely to happen should the US dollar enjoy a significant rally across the board. At this stage the weaker dollar is helping reserve accumulation, which in turn is helping global liquidity and so would offset any negative impact of higher interest rates.
For the prospect of higher risk aversion to play out the US dollar would need to rally against the reserve accumulating currencies – i.e. The Asian currencies – not against the euro and sterling.
On this basis they don’t think that higher US interest rates in time will negatively impact risk assets.
Using similar logic, the thinking is that higher interest rates from the ECB – which is now the consensus - may likely weaken the US dollar against the main reserve accumulating currencies and so in this sense “higher rates may lead to stronger global liquidity, not weaker liquidity.”
So far the prospect of firmer interest rates has not affected risk aversion.
Kind regards
Ian de Lange
info@seedinvestments.co.za
www.seedinvestments.co.za
021 9144966
Top News
![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=%252Fnewsimages%252F2011-04-05T121419Z_01_AJOE7340XZX00_RTROPTP_3_OZABS-MAIZE-SAFRICA-EXPORTS-20110405.JPG "-PHOTO TAKEN 23FEB06- Black South African commercial farmer Motsepe Matlala inspects the maize growi..") South Africa recorded a big jump in maize exports last week, lifted by sales to Brazil and South Korea, data showed on Tuesday, and maize futures edged down as the rand held firm against the dollar. Full story ![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=%252Fnewsimages%252F2011-04-05T090925Z_01_AJOE7340PFR00_RTROPTP_3_OZABS-SAFRICA-INVESTMENT-20110405.JPG "Shopping carts are seen outside a Wal-Mart Supercenter in Coolidge") South Africa is not against foreign investment, Business Day reported on Tuesday, amid worries that its intervention in takeover hearings involving Wal-Mart and Kansai Paint could put off investors. Full story |
 Ivory Coast's Laurent Gbagbo was negotiating the terms of his departure from power on Tuesday following a fierce assault by forces loyal to his presidential rival backed by U.N. and French helicopter airstrikes. Full story  The operator of Japan's crippled Fukushima nuclear power plant said it had reduced the flow of highly radioactive water out of a reactor, a possible sign of progress in an almost month-long battle to contain the world's biggest nuclear disaster in quarter of a century. Full story  The International Criminal Court has evidence Muammar Gaddafi's government planned to put down protests by killing civilians before the uprising in Libya broke out, the ICC's prosecutor said on Tuesday. Full story |
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Markets |
U.S. stocks rose on Tuesday,
led by tech shares after the proposed merger of two major
semiconductor companies and an updating of a. . . Full story |
Gold jumped to an all-time
high above $1,450 an ounce on Tuesday, as new peaks for crude
and corn prices fanned inflation fears. . . Full story |
European shares edged up to
their highest close in nearly four weeks on Tuesday, with energy
firms gaining after further unrest in the. . . Full story |
Britain's top share index edged
lower on Tuesday as miners fell on concerns that an interest
rate hike in China could hurt demand. . . Full story | |||
Spot gold notched a record
high on Tuesday as a downgrade of Portugal's debt stirred a bid
for safety, while on Wall Street. . . Full story |
Australian shares climbed 0.3 percent on
Tuesday to a six-week high as takeover activity in the resources sector and
speculation of more to. . . Full story |
Silver jumped to its highest
since early 1980 on Tuesday on inflation concerns, a rise in ETF
holdings to another record and growing. . . Full story |
The S&P 500 met tough
resistance on Monday, failing to break a level that has held
since mid-February and ending flat even as. . . Full story | ||||
SA Business |
Harmony Gold, the world's fifth largest gold miner, said on Tuesday that a mine in South Africa it had shut after a fatality last week will reopen with the morning shift on Wednesday.. . . Full story |
South Africa's rand hovered near early January highs against the dollar on Tuesday and should hold its ground during the session as risky assets remain in favour with investors globally.. . . Full story | |||||
. . . Full story | General Motors East Africa
(GMEA), Kenya's top vehicle assembler, expects sales to grow by
50 percent this year driven by demand for public. . . Full story | Sudani, the mobile phone unit of Sudan's state-owned Sudatel telecoms company, is expanding its subscriber base and grabbing market share thanks. . . Full story | . . . Full story |
The exodus of investors from
emerging market equities that began late last year is reversing,
in part due to the prospects for higher interest rates in
developed economies and partly due to them. . . Full story | Orascom Telecom (OT) has made no progress in a dispute with the Algerian government and will bring the matter to international arbitration if it is not resolved, OT's chairman said on. . . Full story | The controlling shareholder of India's
Idea Cellular is mulling a sale of its stake in the
mobile carrier and has held talks with potential bidders
including MTN Group , Bloomberg reported, citing sources
with knowledge. . . Full story |
Company News |
At the second (2nd) annual general meeting of shareholders of the company held today, Tuesday, 05 April 2011 at 10h00, all. . . Full story |
Shareholders are advised that the annual financial statements were distributed to shareholders on 04 April 2011 and contain no modifications to. . . Full story |
Alexander Scott MacDonald tendered his resignation as a CEO of Evraz Highveld Steel and Vanadium Ltd, part of the Evraz Group. . . Full story |
Resgen released a presentation to update investors on its progress with the development of the boikarabelo mine in the Waterberg region.. . . Full story | |||
World Markets (Spot Prices)
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The JSE Today
Trading Statistics| Date | Adv. | Decl. | Unch. | Actives | Volume | Value | Trades | Orders |
|---|---|---|---|---|---|---|---|---|
| 05/04/2011 | 219 | 132 | 78 | 429 | 251,738,134 | R10,439,040,904 | 78531 | 1807082 |
| 04/04/2011 | 197 | 145 | 73 | 415 | 219,118,224 | R9,815,944,176 | 89949 | 1694363 |
| 01/04/2011 | 200 | 136 | 81 | 417 | 278,937,111 | R13,076,718,578 | 106885 | 2036488 |
| 31/03/2011 | 190 | 154 | 86 | 430 | 317,069,149 | R16,915,811,553 | 121859 | 1962439 |
| 30/03/2011 | 280 | 92 | 72 | 444 | 292,592,061 | R16,907,826,853 | 134331 | 2036044 |
Major Moves Up
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Major Moves Down
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Index Summary
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Stock Exchange News Service
| Date | Time | Headline |
| 05/04/2011 | 17:40 | Iquad Group Limited - Trading statement |
| 05/04/2011 | 17:35 | JD Group Limited - Update on proposed transaction with Steinhoff |
| 05/04/2011 | 17:06 | Datacentrix Holdings Limited - Voluntary trading statement |
| 05/04/2011 | 16:14 | RDFIVB - Investec Warrants - Amendment to the declared interest distribution |
| 05/04/2011 | 16:13 | RDFIVC - Investec Warrants - Amendment to the declared interest distribution |
| 05/04/2011 | 15:48 | Old Mutual Plc - Information update for the period up to 4 April 2011 |
| 05/04/2011 | 15:35 | Jasco - Change to the board of directors |
| 05/04/2011 | 15:18 | Imuniti Holdings Limited - Change in auditors |
| 05/04/2011 | 15:10 | NAI/NAN - NAIL - Advance Agterskot Payment and Dividend Declaration (No 6) |
| 05/04/2011 | 15:00 | Raubex Group Limited - Trading Statement in respect of the year ended 28 |
| 05/04/2011 | 15:00 | Platmin Limited - Appointment of Mr Craig Shaw as Platmin`s new Chief |
| 05/04/2011 | 14:44 | SCIB/SBR003 - The Standard Bank of South Africa Limited - Interest Rate |
| 05/04/2011 | 14:04 | Oando - Recommendation of dividend and bonus issue of ordinary shares |
| 05/04/2011 | 13:33 | Trans Hex - Resignation of a Director |
| 05/04/2011 | 13:00 | Royal Bafokeng Platinum Limited - Report on proceedings at annual general |
| 05/04/2011 | 12:40 | Nedbank Group Limited - Dealing in Securities by Non-executive Director |
| 05/04/2011 | 12:30 | Control Instruments Group Limited - No change statement and notice of |
| 05/04/2011 | 11:46 | Peregrine Holdings Limited - Voluntary announcement regarding |
| 05/04/2011 | 11:45 | Vunani Limited - Sale of Vunani`s Ordinary Shareholding and Preference |
| 05/04/2011 | 11:35 | Distell Group Limited - Dealings in Securities by a Director of a Major |
| 05/04/2011 | 11:19 | Trading of Exxaro ordinary shares on behalf of the Exxaro Resources |
| 05/04/2011 | 11:03 | EXT - Extract Resources Limited - Definitive Feasibility Study demonstrates |
| 05/04/2011 | 11:02 | EXT - Extract - Extension of EPL 3138 |
| 05/04/2011 | 10:53 | Nedbank Group - Dealings in Securities by Executive Directors and Company |
| 05/04/2011 | 09:44 | JSE Limited - No Change Statement and Notice of Annual General Meeting |
| 05/04/2011 | 09:19 | TAW/TAWA - Tawana Resources NL - Expired Options |
| 05/04/2011 | 09:12 | Oceana Group Limited - Appointment of director |
| 05/04/2011 | 09:00 | Naspers - Appointment of New CEO of MIH Holdings Limited |
| 05/04/2011 | 09:00 | Evraz Highveld Steel and Vanadium Limited - Resignation of Director and |
| 05/04/2011 | 08:05 | Resgen - Investor Presentation Update |
| 05/04/2011 | 08:00 | GLD - NewGold Issuer Limited - Listing of additional Newgold Debentures |
| 05/04/2011 | 08:00 | Jubilee Platinum Plc - Cautionary announcement update |
| 05/04/2011 | 07:30 | Metorex Limited - Operational Update - quarter ended March 2011 |
| 05/04/2011 | 07:13 | Gold One International Limited - March 2011 quarterly production exceeds |
| 05/04/2011 | 07:10 | British American Tobacco p.l.c - Transaction in own shares |
| 05/04/2011 | 07:05 | CoAL - Appendix 3X - Initial Director`s Interest Notice |
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