Thursday, 02 June 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
Foreign Flows and Currencies When looking at the strength or weakness of the rand over the long term (10 years) we believe that it will revert to its Purchasing Power Parity (PPP) level, but over the short to medium term it will be heavily influenced by other factors that may or may not have the same drivers as the long term inflation differential of two countries (essentially the method used to calculate PPP exchange rate).
One such factor that has a large impact on any currency is flows into (out of) a country. These can typically be split into two categories: portfolio flows and Foreign Direct Investment (FDI). Naturally flows into a country help to strengthen the currency. From Economics 101 we know that increased demand for a product (in this case a currency), with a stable supply, will lead to an increase in price (in this case currency strength).
FDI is typically preferred to portfolio flows as it’s stickier. With FDI, the investor is generally making a long term investment, as there are large transaction costs – i.e. it would be very expensive to repatriate the investment over the short term. FDI is a good indicator that the investor has faith in the country’s economy and growth prospects. The acquisition of a controlling interest in Massmart by Walmart is an example of FDI.
On the other hand portfolio flows (investments into security markets – i.e. share and bond purchases) are more fluid. Here the investor is looking for a good return on investment, but either doesn’t have the resources or mandate for direct investment, or doesn’t have confidence in the long term prospects of the country, and wants to have the ability to withdraw the investment on short notice. South Africa is an easy target for so called ‘hot money’ as we have highly developed and liquid capital markets (i.e. it is easy for investors to get in and out quickly) when compared to other emerging markets and have favourable trading hours when compared to most of Europe which makes it easier for them to trade in and out of our market on an intraday basis.
Over the past seven or eight years we have seen net capital inflows into our equity market, although there have been periods of heightened volatility where capital has been rapidly withdrawn from our market. In the chart below showing monthly net purchases of local equity versus the movement of the rand we can see that there is a high correlation between money flowing into our equity market and the rand strengthening, and vice versa.
Source: I-Net
These types of investments are typically dependant on the risk appetite of the large global investors and shorter term news flow which is difficult or even impossible to predict. We therefore stick to our valuation based approach of looking at the rand, fully cognisant that it may not revert to fair value over the short term – as a result of the above mentioned factors – but confident that over the longer term valuation will trump sentiment.
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Take care,
Mike Browne
info@seedinvestments.co.za
www.seedinvestments.co.za
021 9144 966
Thu, 02 Jun 2011
Top News
The South African rand gained 1.4 percent on the dollar to hit a fresh 3-week high on Thursday as soft U.S. data kept the greenback weak and offshore bond buying lent support to the local currency. Full story
South Africa's wheat futures closed flat in quiet local trade on Thursday and in line with U.S. prices, while maize and soybeans futures edged up. Full story |
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Japanese Prime Minister Naoto Kan on Thursday survived a no-confidence vote by offering to resign once he has overcome the worst of the country's nuclear crisis, a last-minute deal with ruling party rebels who had threatened to oust him from office. Full storyForces loyal to President Ali Abdullah Saleh battled with tribal fighters in Yemen's capital on Thursday in overnight clashes that killed dozens as a U.S. envoy flew around the region to try and stop a civil war. Full storySyrian forces killed at least 13 civilians in the central town of Rastan on Thursday, activists said, in the latest attempt to quell a revolt against the 11-year rule of President Bashar al-Assad. Full story |
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Markets | Gold slid more than 1
percent on Thursday to post its biggest one-day decline in a
month as the yellow metal was sold. . . Full story | | The S&P 500 rebounded from
earlier losses on Thursday following news of a fresh funding
plan to help Greece pay off its mountain. . . Full story | | European shares fell sharply for
a second straight session to a six-week closing low on Thursday
as more U.S. data raised concerns about. . . Full story | | World stocks and oil slumped
for a second straight day on Thursday as U.S. data kept
investors on edge, with a slight drop. . . Full story |
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| Britain's top shares slid for a
second day as worries over weak economic data drove investors
from risky assets ahead of Friday's. . . Full story | | Japanese share prices fell sharply
on Thursday, after disappointing U.S. data added to suspicions
that the global economy may be losing traction, prompting
traders. . . Full story | | Australian stocks fell 2.3
percent on Thursday, the largest one-day percentage fall in a
year, after disappointing U.S. economic signs sent global share
markets. . . Full story | | Asian stocks slid on Thursday,
with a steady stream of weak U.S. data putting a damper on risk
taking ahead of Friday's payrolls. . . Full story |
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SA Business | | | South Africa's rand firmed slightly against the dollar on Thursday and could re-test stronger levels in the mid-6.70's if the greenback remains on the back foot.. . . Full story |
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| South African paper maker Sappi plans to invest more in pulp production as its paper business remains under pressure from soft. . . Full story | | Diageo Plc, the world's biggest spirits group, expects 10 percent plus sales and profit growth in Latin America and Africa this. . . Full story | | South Africa will bid to host the
2022 Commonwealth Games having last week pulled out of the race
to stage the 2020 summer. . . Full story | | South African power utility Eskom said on Thursday it would auction up to 300 million rand of its ES23 bond due. . . Full story |
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Company News | Shareholders are advised that Mr. Graham Edward Ferns has resigned with effect from 31 May 2011. With effect from 1 June. . . Full story | | Further to the cautionary announcement on 13 September 2010 and subsequent renewals of the cautionary announcement released on the SENS, shareholders. . . Full story | | Mr. Edward Pan has decided to relinquish his role as the CEO of SOH with effect 1 July 2011. Mr Paul. . . Full story | | Shareholders are referred to the announcement released by BCX on SENS on Thursday 24 May 2011 and in the press on. . . Full story |
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| Ms Karabo Nondumo has resigned from the board as non-executive director with immediate effect. Mr. Nico de Waal ("Nico") has been. . . Full story | | The JSE advised that the auditors' reviewed reports on the PSV's provisional results for the year ended 28 February 2011 contain. . . Full story | | | | The company's audited results for the year ended 31 March 2011 are expected to be published on or about 9 June. . . Full story |
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Company Results | Revenue improved by 14.2% to R4.5 billion (R4 billion) and operating profit rose by 11.5% to R505.5 million (R453.3 million). Net. . . Full story | | Investment income for the year ended 28 February 2011 fell to R11.8 million (2010: R32.3 million). Operating loss rose to R3. . . Full story | | Interest income declined by 32% to R309 million (R454.1 million). Operating income decreased by 44% to R303.5 million (R544.9 million). The. . . Full story | | |
World Markets (Spot Prices)
Name | Time | RP | Move | % Move | JSE Overall | 17:00 | 31877.77 | -444.33 | -1.37% | JSE Top 40 | 17:00 | 28572.67 | -461.16 | -1.59% | JSE Gold | 17:00 | 2557.65 | -59.99 | -2.29% | JSE Financial | 17:00 | 21681.05 | -165.39 | -0.76% | JSE Industrial | 17:00 | 33052.17 | -292.25 | -0.88% | JSE Indust 25 | 17:00 | 27819.80 | -267.11 | -0.95% | JSE Resource | 17:00 | 53698.12 | -1254.57 | -2.28% | DJ Futures | 19:56 | 12240.00 | -21.00 | -0.17% | DJ Ind | 19:31 | 12243.67 | -46.47 | -0.38% | SP 500 | 19:50 | 1312.84 | -1.71 | -0.13% | Nasdaq | 19:50 | 2771.19 | 2.00 | 0.07% | FTSE 100 | 17:35 | 5847.92 | -80.69 | -1.36% | DAX | 18:00 | 7074.12 | -143.31 | -1.99% | CAC40 | 17:46 | 3889.87 | -74.94 | -1.89% | Nikkei | 08:32 | 9555.04 | -164.57 | -1.69% | Shanghai | 09:32 | 2705.18 | -38.79 | -1.41% | Hang-Seng | 10:26 | 23253.84 | -372.59 | -1.58% | All Ords | 08:41 | 4683.20 | -105.40 | -2.20% | NZSE 50 | 07:26 | 3525.82 | -25.72 | -0.72% |
| | Name | Time | RP | Move | % Move | Gold | 19:58 | 1535.29 | -4.67 | -0.30% | Gold/Rand | 19:58 | 10311.74 | -206.70 | -1.97% | Gold/R kg | 19:56 | 331547 | -5265 | -1.56% | Silver | 19:58 | 36.2480 | -.5670 | -1.54% | Platinum | 19:58 | 1811.00 | -3.25 | -0.18% | Palladium | 19:58 | 768.50 | 2.02 | 0.26% | R157 | 17:06 | 7.42 | -.01 | -0.13% | R204 | 17:06 | 8.10 | .01 | 0.06% | Brent Crude | 19:56 | 115.09 | .41 | 0.36% | Rand / Dollar | 19:58 | 6.7184 | -0.1102 | -1.61% | Rand / Pound | 19:55 | 10.9702 | -0.1478 | -1.33% | Rand / Euro | 19:55 | 9.7419 | -0.0436 | -0.45% | Rand / NZD | 19:58 | 5.4875 | -0.0705 | -1.27% | Rand / AUD | 19:55 | 7.1733 | -0.0767 | -1.06% | Yen / Dollar | 19:57 | 80.8700 | -0.0100 | -0.01% | Euro / Dollar | 19:58 | 0.6898 | -0.0081 | -1.16% | Dollar / Euro | 19:58 | 1.4498 | 0.0173 | 1.21% | Pound / Dollar | 19:55 | 0.6108 | -0.0015 | -0.24% |
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The JSE Today
Trading Statistics
Date | Adv. | Decl. | Unch. | Actives | Volume | Value | Trades | Orders |
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02/06/2011 | 101 | 238 | 80 | 419 | 250,824,272 | R12,193,489,656 | 103922 | 1555471 | 01/06/2011 | 121 | 215 | 74 | 410 | 225,795,481 | R9,863,692,055 | 87696 | 1709465 | 31/05/2011 | 232 | 145 | 60 | 437 | 616,515,278 | R25,230,651,310 | 128797 | 1542631 | 30/05/2011 | 170 | 121 | 105 | 396 | 155,601,505 | R4,458,300,212 | 52198 | 970938 | 27/05/2011 | 233 | 108 | 93 | 434 | 253,129,406 | R10,705,830,537 | 90949 | 1458401 |
Index Summary Index Name | RP | Move | % Move | Top 40 | 28,572.67 | -461.16 | -1.59% | Industrial | 33,052.17 | -292.25 | -0.88% | Mid Cap | 42,090.02 | -100.80 | -0.24% | Small Cap | 32,184.06 | -14.22 | -0.04% | Resource 20 | 53,698.12 | -1254.57 | -2.28% | Industrial 25 | 27,819.80 | -267.11 | -0.95% | Financial 15 | 8,178.07 | -72.00 | -0.87% | Financial & Ind. 30 | 30,952.26 | -316.78 | -1.01% | All Share | 31,877.77 | -444.33 | -1.37% | Oil & Gas | 26,696.97 | -615.31 | -2.25% | Mining | 35,334.09 | -797.29 | -2.21% | Gold Mining | 2,557.65 | -59.99 | -2.29% | Platinum Mining | 71.76 | -.70 | -0.97% | Oil & Gas Producers | 14,354.47 | -330.84 | -2.25% | Basic Materials | 29,903.37 | -658.61 | -2.15% | Chemicals | 13,845.23 | -67.05 | -0.48% | Forestry & Paper | 14,837.46 | -86.07 | -0.58% | Industrial Metals | 28,268.51 | -775.24 | -2.67% | Industrials | 27,980.69 | -153.58 | -0.55% | General Industrials | 76,793.42 | -478.06 | -0.62% | Consumer Goods | 27,383.59 | -449.49 | -1.61% | Automobiles & Parts | 3,204.21 | .00 | 0.00% | Household Goods | 152.02 | -4 | -2.72% | Health Care | 33,303.55 | 11.17 | 0.03% | Beverages | 83.89 | -1.72 | -2.01% | Food Producers | 47,606.89 | -477.15 | -0.99% |
| | Index Name | RP | Move | % Move | Personal Goods | 439.46 | -4.99 | -1.12% | Consumer Services | 54,007.43 | -225.42 | -0.42% | General Retailers | 41,353.40 | -26.16 | -0.06% | Travel & Leisure | 3,636.57 | -13.07 | -0.36% | Media | 88.08 | -.15 | -0.17% | Support Services | 2,372.69 | 1.18 | 0.05% | Telecommunications | 69,783.44 | -102.20 | -0.15% | Financials | 21,681.05 | -165.39 | -0.76% | Banks | 40,545.13 | -419.53 | -1.02% | Non-life Insurance | 30,311.37 | 121.25 | 0.40% | Life Insurance | 15,904.34 | -128.17 | -0.80% | General Financial | 2,321.76 | -5.06 | -0.22% | Technology | 21,413.00 | -215.87 | -1.00% | SHARIAH TOP40 | 3,147.45 | -62 | -1.92% | FTSE/JSE SHARIAH ALL | 3,210.80 | -58 | -1.78% | COAL MINING | 21,022.03 | -472 | -2.20% | FTSE JSE Fledgling | 4,634.46 | -2 | -0.04% | FTSE/JSE Alt X | 1,042.46 | -22 | -2.03% | SA LISTED PROPERTY | 379.24 | | -0.21% | CAPPED PROPERTY | 315.05 | | -0.52% | RESOURCE | 29,684.07 | -672 | -2.21% | DIVIDEND PLUS | 169.63 | -1 | -0.40% | FTSE/JSE RAFI 40 | 6,665.64 | -87 | -1.29% | Capped Top 40 | 14,937.95 | -224 | -1.48% | Capped All Share | 16,072.29 | -213 | -1.31% |
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Click here for the Sharenet Index Summary page
Latest Consensus Changes** Code | Company Name | Status | Updated | AIP | ADCOCK INGRAM HLGS LD | HOLD | 31 May | NED | NEDBANK GROUP LTD | SELL | 30 May | SBK | STANDARD BANK GROUP LIMIT... | SELL | 30 May | PFG | PIONEER FOODS GROUP LTD | HOLD | 30 May | BTI | BRITISH AM. TOBACCO PLC | BUY | 30 May |
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Results Expected** Expected | Company Name | Fin. Date | 03 Jun 2011 | BJM | March 2011 (Final) | 03 Jun 2011 | BRAIT | March 2011 (Final) | 03 Jun 2011 | BRC DIAM | March 2011 (Q) | 03 Jun 2011 | HUGE | February 2011 (Final) | 03 Jun 2011 | INVPROP | March 2011 (Final) |
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Recent Dividends** Share Name | Dec-Date | LDT | Pay-Date | Amount | INVICTA | 11-06-01 | 11-07-01 | 11-07-11 | R 1.2600 | PERGRIN | 11-06-01 | 11-07-15 | 11-07-25 | R 0.3500 | CROOKES | 11-05-31 | 11-07-01 | 11-07-11 | R 0.6500 | TONGAAT | 11-05-30 | 11-07-08 | 11-07-21 | R 1.4000 | TIGBRANDS | 11-05-30 | 11-06-24 | 11-07-04 | R 2.8100 |
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Ex Div** Share Name | Dec-Date | LDT | Pay-Date | Amount | OASIS | 11-05-11 | 11-05-27 | 11-06-03 | R 0.4616 | MVELA RES | 11-05-20 | 11-05-27 | 11-06-06 | R 0.3100 | BASREAD | 11-03-24 | 11-05-27 | 11-06-06 | R 0.3000 | LIFEHC | 11-05-10 | 11-05-27 | 11-06-06 | R 0.2000 | ELBGROUP | 11-03-16 | 11-05-27 | 11-06-06 | R 0.1500 |
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Upcoming AGMs** Code | Company Name | Date | Status | HWN | Howden Africa Holdings Ltd | 02/06/2011 | Confirmed | UNI | Universal Industries Corporation Ltd | 02/06/2011 | Confirmed | CPI | Capitec Bank Holdings Ltd | 03/06/2011 | Confirmed | CPIP | Capitec Bank Holdings Ltd | 03/06/2011 | Confirmed | SLMB | Sanlam Ltd | 08/06/2011 | Confirmed |
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Stock Exchange News Service Click here for more SENS news
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