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 The Sharenet Daily 
Thursday, 14 July 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
Top News
SA Business
Company News
Company Results
World Markets (Spot Prices)
JSE Today
JSE Trading Statistics
Major Moves
Index Summary
Latest Consensus Changes / Results Expected
Recent Dividends / Ex Div
Upcoming AGMs
Stock Exchange News Service (SENS)

European Debt Crisis

The European sovereign debt crisis, which started in late 2009, has continued almost unabated as it moves from one European country to another.

The problems in Portugal, Spain, Ireland, Greece, and now also Italy weigh heavily on the European Union as a whole. At its most basic level, the issue is one of public debt levels that are not sustainable, with ongoing and rising budget deficits adding to the overall debt levels.

In May 2010, the European Financial Stability Facility was created, which is essentially a rescue package operation of around EUR 440 billion, with the aim to try and ensure a degree of stability across Europe.

Initial rescue packages aimed at providing states with the ability to roll over debt as it matures have been agreed with Greece, Ireland, and Portugal, but these negotiations are ongoing.

These European countries were able to borrow at low rates of interest after the introduction of the Euro. This in turn allowed their economies to perform well on the back of them taking on greater and greater levels of debt. But now it is payback time for the debtor nations.

The European Financial Stability Facility was put in place in May 2010, aimed at preserving financial stability through providing financial assistance to struggling Eurozone states. It is going to be replaced by the more permanent crisis mechanism, the European Stability Mechanism (ESM), which is expected to come into force in early to mid-2013.

Government bonds
A government bond is a bond issued by a national government denominated in the country's own currency. Bonds issued by national governments in foreign currencies are normally referred to as sovereign bonds. Bonds issued by governments are usually referred to as risk-free bonds, because the government can raise taxes to redeem the bond at maturity. For a foreign investor or indeed where a government issues a bond in a currency other than its own, there is the currency risk.

In addition to the currency risk is the risk of inflation. At a bond’s maturity, the purchasing power of the principal repaid is often likely to be less than the original investment. A bond is a debt instrument, where the issuer owes the holders the principal at a defined maturity date as well as interest or coupon payments on pre agreed dates, typically every 6 months.

In essence then a bond is nothing more than a loan, where the issuer – normally a government – is the debtor and the lenders are a variety of creditors.

Sovereign bond spreads
Sovereign-bond spreads is the extra interest rate of one bond compared with bonds issued by another country. In the case of the Eurozone, Germany is considered the safest credit.

The Eurozone debt problem:
The map below gives an indication of the problem countries. Greece has a debt to GDP ratio of 143% - some indications are that it’s close to 160%, Italy’s debt runs at 119%, Ireland at 96%, and Portugal at 93%.

Debt to GDP: Euro Map

Source: Economist

The chart below gives an indication of the debt of some of the major economies by way of comparison. Japan is by far the highest. It has however managed to continue to roll over debt as it matures because the bulk is yen denominated. By way of comparison, South Africa is running with a ratio of 40%.

Government debt to GDP: major economies

For over 10 years from 1998 to 2011 the yield on Greece’s 10 year government bond averaged 5,3%, reaching a record low of 3,2% in September 2005. But in 2011 it spiked up to 16,9% in June. It is currently trading at around 16,7%.

Source: tradingeconomics.com

The spike in yields is a clear reflection of the problems facing this economy. Politicians seem to be divided as to how to deal. Up until now it’s been a matter of kicking the problem down the road, extending some life-saving credit in return for some budgets austerity measures. But there is also growing dissatisfaction, especially from the camp that have to pay up for Greece’s profligate spending and low tax collections.

It is increasingly looking like holders of debt are going to have to realise a knock on their capital.

Italy's Government Bond Yield for 10 Year Notes rallied 122 basis points during the last 12 months. From 1993 until 2011 Italy's Government Bond Yield for 10 Year Notes averaged 5.9 percent reaching an historical high of 13.7 percent in March of 1995 and a record low of 3.2 percent in September of 2005.

Yesterday, however, Italy issued treasury bills for the first time since borrowing costs started blowing out – they came to the market looking for 6,75 billion euros. The spread above the German bonds moved up to 3,27% and the yields traded at over 6% for the first time since 1997.

The extent of the selloff can be clearly seen from the chart below, where yields had been trading around 5%. The 6% level has been highlighted.

Source: tradingeconomics.com

From 1997 until 2011 Portugal's Government Bond Yield for 10 Year Notes averaged 4.7 percent reaching an historical high of 12.9 percent in July of 2011 and a record low of 3.2 percent in September of 2005.

The country saw the downgrade of its credit rating on government debt 4 notches to junk status by Moody rating agency last week. This had an immediate impact on the cost of funding for both government and corporates.

The chart below reflects the spike in the yields on 10 year bonds. These yields moved up to 14,4% or a massive 10,7% above German bond yields.

Source: tradingeconomics.com

In a very similar way, yields traded at low levels throughout the decade, reaching a low of 3,1% in September 2005. However the crises saw yields jump up massively.

Source: tradingeconomics.com

The spikes in the yields, the ongoing talks and wrangling about debt bailouts for these countries and the rating downgrades, all point to a high possibility of actual defaults on the debts.

Bonds as an investment
Traditional investment portfolio theory has advocated the inclusion of bonds in a portfolio. Bonds have different risk and return characteristics compared to other investors such as equities, which has made them attractive additions to a balanced portfolio. However as with all investments, the recent past can never be extrapolated into the future as a given. The charts above reflect the fact that for many years while yields remain fairly steady, bonds gave the appearance of a low risk investment. As the risks however materialised and yields spiked to a truer pricing level, so holders of these bonds have and continue to sustain massive losses.

With the yields at 12-16% there may now be an argument that these bonds represent value. This may well be the case, but we would not be advising an increase in exposure, because it is not that clear that there is true value. In general we continue to advocate a minimal exposure to global bonds.

Kind regards,

Ian de Lange
021 9144 966

Thu, 14 Jul 2011
Top News
South Africa's rand softened against the dollar on Thursday, with dealers saying the Reserve Bank came into the market to buy foreign exchange after it rallied from 6-week lows.  Full story

Strikes in South Africa escalated on Thursday after workers in the paper industry joined a walk-out across the petroleum sector that had raised concerns about fuel supplies in Africa's biggest economy.  Full story
Indian police sifted through forensic evidence and security camera footage and questioned members of a home-grown Islamist militant group for clues to the worst bomb blasts in Mumbai since Pakistan-based militants attacked the financial hub in 2008, officials said on Thursday.  Full story
A suicide attacker who appears to have concealed his explosives inside a turban killed a senior cleric and at least four other people on Thursday at a funeral service for the assassinated brother of the Afghan president in southern Kandahar city.  Full story
The Italian austerity budget worth nearly 48 billion euros was approved by the upper house of parliament on Thursday, overcoming its first parliamentary hurdle.  Full story
Gold pared gains on Thursday after hitting a record near $1,600, as the dollar erased losses after Federal Reserve Chairman Ben Bernanke crushed. . .  Full story
European stocks ended lower on Thursday, losing ground for the fourth time in five sessions as Moody's warning on U.S. debt and rising. . .  Full story
Falls among commodity issues sapped the strength of Britain's top share index on Thursday, as worries over global growth clouded the demand outlook. . .  Full story
Gold prices hit another record high and the U.S. dollar slid to a fresh low against the Swiss franc on Thursday in the. . .  Full story

European shares fell on Thursday after Moody's warned the United States may lose its top credit rating if politicians fail to agree an. . .  Full story
Australian stocks fell 0.5 percent to the lowest close in two weeks on Thursday, pulled down as department store David Jones plunged 18. . .  Full story
The Nikkei stock average fell but did not decisively break a major support on Thursday after Moody's said it may cut the United. . .  Full story
U.S. stocks stopped a three-day slide, but ended well off the highs on Wednesday as investors took the suggestion of further Federal Reserve stimulus. . .  Full story
SA Business
South Africa's MTN Group said on Thursday it has launched trials of its faster LTE network, as it gears up to. . .  Full story
Telecoms carrier Zain Sudan is in talks with South Sudan to pay a fee to extend its Sudan licence to the. . .  Full story
South Africa's gold output fell 5.8 percent in volume terms in May while total mineral production rose 9.6 percent compared with. . .  Full story
South African assets continued a recovery from multi-week lows in early Thursday trade, finding support in record gold prices as investors. . .  Full story

DRDGold, South Africa's fourth-largest gold producer, said on Thursday it has appointed a company rescue specialist for its distressed Blyvoor mine,. . .  Full story
South Africa's Wesizwe Platinum will look at consolidation with neighbouring mines as it aims for full production at its new mine. . .  Full story
South Africa's most prominent corruption buster accused the police and bureaucrats on Thursday of improper behaviour in $265 million lease deals that have embarrassed. . .  Full story
South African maize futures scaled new 2-1/2 year highs on Thursday as technical factors and healthy exports pushed prices up, and. . .  Full story

Global miner Rio Tinto said on Thursday that a strike at its Rossing Uranium mine in Namibia had entered its third day and it could not say yet what impact there. . .  Full story
South African stocks rose in line with global counterparts on Wednesday and got an extra lift from gold mining shares, which soared as bullion's spot price scaled new peaks.. . .  Full story
. . .  Full story
Company News
Shareholders are advised that for the six months ended 30 June 2011, the headline earnings per share are expected to be. . .  Full story
Vox is pleased to announce that it has received an offer from Business Venture Investments No 1542 (Proprietary) Limited ("BidCo"), a. . .  Full story
DRDGOLD shareholders ("Shareholders") are advised that the Company's distressed operating subsidiary, Blyvooruitzicht Gold Mining Company Limited ("Blyvoor") has accepted an offer. . .  Full story
Shareholders are referred to the announcement, dated 10 June 2011, regarding the disposal by PSV in terms of the Sale and. . .  Full story

Shareholders are advised that Zurich is currently finalising its results for the six months ended 30 June 2011 which should be released on SENS on or about 25 July 2011. Basic earnings per share and headline earnings per share are anticipated. . .  Full story
According to The Financial Mail, Hudaco is using tough economic times to expand through acquisitions and keep its bottom ine growing. Hudaco CEO Steve Connelly said because the firm is so closely linked to mining and growth has been brought to. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0032203.94-106.44-0.33%
JSE Top 4017:0028847.47-107.10-0.37%
JSE Gold17:002519.27-25.84-1.02%
JSE Financial17:0021761.3123.580.11%
JSE Industrial17:0033721.28-60.96-0.18%
JSE Indust 2517:0028356.75-52.65-0.19%
JSE Resource17:0053887.21-388.65-0.72%
DJ Futures20:0012420.0062.000.50%
DJ Ind19:4112469.13-22.48-0.18%
SP 50019:461313.54-4.18-0.32%
FTSE 10017:355846.95-59.48-1.01%
All Ords08:374561.30-21.90-0.48%
NZSE 5007:263409.55-14.80-0.43%
NameTimeRPMove% Move
Gold/R kg20:0034949737481.08%
Brent Crude19:56116.14-2.10-1.78%
Rand / Dollar19:596.84010.02820.41%
Rand / Pound19:5911.01780.02510.23%
Rand / Euro19:599.6926-0.0086-0.09%
Rand / NZD19:585.77230.03550.62%
Rand / AUD19:597.35030.00600.08%
Yen / Dollar19:5979.06000.25000.32%
Euro / Dollar19:590.70550.00320.46%
Dollar / Euro19:591.4172-0.0062-0.44%
Pound / Dollar19:590.61880.00070.11%

Click here for the Sharenet Spot Price page
The JSE Today
Trading Statistics

Major Moves Up
SharenameSaleMove% MoveVolume
1 EASTPLATS  669497.90.%105603
2 VERIMARK  171116.88.%171850
3 WITSGOLD  44002004.76.%538
4 AMA  17884.71.%113293
5 URONE  2173934.47.%129014
6 ILIAD  595254.39.%30275
7 HOSP-B  740304.23.%29758
8 TASTE  10344.04.%236256
9 TELEMASTR  14553.57.%10000
10 JASCO  10333.00.%24000
11 PAN-AF  14842.78.%1404288
12 NICTUS  19552.63.%143000
13 KELLY  390102.63.%21500
14 NORTHAM  40501002.53.%1953566
15 ROCKWELL  500122.46.%1000
16 ANGLOPLAT  6125213512.26.%1191479
17 IMPLATS  176003802.21.%5324602
18 ADCORP  2750552.04.%31069
19 ABIL  3552621.78.%4664747
20 PETMIN  30551.67.%1077797

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Major Moves Down
SharenameSaleMove% MoveVolume
1 LONAFRIC  150-20-11.76.%156
2 SOVFOOD  520-30-5.45.%26660
3 FREEWORLD  954-46-4.60.%1000
4 BELL  1400-65-4.44.%496560
5 HOSP-A  1405-44-3.04.%201503
6 BAUBA  170-5-2.86.%42375
7 PARACON  175-5-2.78.%274002
8 EHSV  4600-130-2.75.%26008
9 ONELOGIX  133-3-2.21.%55302
10 CBH  469-10-2.09.%38761
11 CITYLDG  6200-124-1.96.%260027
12 HARMONY  9564-188-1.93.%1985336
13 BILLITON  26348-483-1.80.%1794271
14 GFIELDS  10490-185-1.73.%1508141
15 MERAFE  114-2-1.72.%5040910
16 HUDACO  7950-135-1.67.%12804
17 EQSTRA  719-11-1.51.%252417
18 DRDGOLD  341-5-1.45.%579447
19 CLICKS  4100-60-1.44.%4189534
20 CASHBIL  9210-130-1.39.%33937

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New Highs
SharenameSaleHighMove% MoveVolume
1 NICTUS  19519552.63.%143000
2 MONDILTDP  57345750360.63.%356439
3 MMI-HLDGS  1728187690.52.%585015
4 EOH  2283235080.35.%54416
5 MONDIPLCP  71427212220.31.%598934
6 DATATEC  39904180-5-0.13.%143546
7 WOOLIES  30953148-5-0.16.%7579373
8 MEDCLIN  31153280-14-0.45.%509068
9 BIDVEST  1658016748-150-0.90.%343277

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New Lows
SharenameSaleLowMove% MoveVolume
1 CITYLDG  62006111-124-1.96.%260027
2 HOSP-B  740700304.23.%29758

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Index Summary
Index NameRPMove% Move
Top 4028,847.47-107.10-0.37%
Mid Cap42,694.97-44.83-0.10%
Small Cap32,505.89-59.27-0.18%
Resource 2053,887.21-388.65-0.72%
Industrial 2528,356.75-52.65-0.19%
Financial 158,181.3415.730.19%
Financial & Ind. 3031,397.22-16.44-0.05%
All Share32,203.94-106.44-0.33%
Oil & Gas 26,982.98-31.47-0.12%
Mining 35,384.88-286.76-0.80%
Gold Mining2,519.27-25.84-1.02%
Platinum Mining67.281.402.13%
Oil & Gas Producers 14,508.25-16.92-0.12%
Basic Materials 30,080.66-229.86-0.76%
Chemicals 14,177.75-27.39-0.19%
Forestry & Paper 15,112.01-15.57-0.10%
Industrial Metals 30,684.80-142.37-0.46%
Industrials 28,807.902.730.01%
General Industrials 79,289.69-191.15-0.24%
Consumer Goods 28,389.48-174.62-0.61%
Automobiles & Parts 3,625.402.270.06%
Household Goods149.3500.00%
Health Care 33,061.10-50.62-0.15%
Beverages 87.51-.55-0.62%
Food Producers 49,326.49-199.05-0.40%
Index NameRPMove% Move
Personal Goods 455.44-3.49-0.76%
Consumer Services 53,481.67-105.12-0.20%
General Retailers 42,295.01-178.09-0.42%
Travel & Leisure 3,765.66-22.18-0.59%
Media 82.76-.12-0.14%
Support Services 2,390.0436.521.55%
Telecommunications 70,375.74430.470.62%
Financials 21,761.3123.580.11%
Banks 40,556.92185.730.46%
Non-life Insurance 31,766.31.000.00%
Life Insurance 16,011.49-29.34-0.18%
General Financial 2,319.387.850.34%
Technology 23,201.72-45.79-0.20%
SHARIAH TOP40 3,174.40-16-0.50%
FTSE/JSE SHARIAH ALL3,237.72-14-0.45%
COAL MINING23,534.21-74-0.31%
FTSE JSE Fledgling 4,606.74110.23%
FTSE/JSE Alt X 1,153.02-21-1.79%
CAPPED PROPERTY 317.97-0.60%
RESOURCE 29,761.93-214-0.71%
DIVIDEND PLUS171.1800.09%
FTSE/JSE RAFI 406,704.86-13-0.20%
Capped Top 4015,071.33-40-0.26%
Capped All Share16,233.90-46-0.28%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
15 Jul 2011ROCKWELLMay 2011 (Q)
19 Jul 2011FOORDJune 2011 (Interim)
19 Jul 2011FOORDCMPSJune 2011 (Interim)
19 Jul 2011FOORDDPJune 2011 (Interim)
19 Jul 2011FOORDPPJune 2011 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
REUNERT5.511-07-1111-07-2211-08-01R 0.0550
NICTUS11-06-3011-07-1511-07-25R 0.0950
BEIGE11-06-3011-07-1511-07-25R 0.0015
HUDACO11-06-2911-08-1211-08-22R 1.3000
PRIMESERV11-06-2911-07-1511-07-25R 0.0250
Ex Div**
Share NameDec-DateLDTPay-DateAmount
TONGAAT11-05-3011-07-0811-07-21R 1.4000
ADCORP11-05-2511-07-0811-07-18R 1.2100
CADIZ11-05-3011-07-0811-07-18R 0.2000
MERCHANT11-06-2011-07-0811-07-18R 0.1100
DCENTRIX11-06-2011-07-0811-07-18R 0.0918

Upcoming AGMs**
CodeCompany NameDateStatus
ATNAllied Electronics Corporation Ltd15/07/2011Confirmed
MMGMICROmega Holdings Ltd15/07/2011Confirmed
ATNPAllied Electronics Corporation Ltd15/07/2011Confirmed
ILVIllovo Sugar Ltd19/07/2011Confirmed
BELBell Equipment Ltd19/07/2011Confirmed

Stock Exchange News Service
14/07/201117:45 MICROmega Holdings Limited - Trading statement
14/07/201117:30 Reinet Investments S.C.A. Depositary Receipts - Net asset value of Reinet
14/07/201117:29GEN - FTSE/JSE Africa Index Series - African Bank Investment Pref. (South
14/07/201117:20 Lewis Group Limited - Directors dealings in securities
14/07/201116:45 Northam Platinum Limited - Operations resume at Northam`s Zondereinde Mine
14/07/201116:31BIFR1 - FirstRand Bank Limited - Interest Rate Reset Announcement
14/07/201116:30 Metorex Limited - Update regarding vale offer and Jinchuan offer
14/07/201116:30BIFR1 - FirstRand Bank Limited - Interest Rate Reset Announcement
14/07/201116:29BIFR1 - FirstRand Bank Limited - Listing of financial instruments
14/07/201116:21MAPPSG - Newfunds Mapps Growth ETF Portfolio - Distribution and Re-Investment
14/07/201116:20MAPPSP - NEWFUNDS MAPPS PROTECT ETF PORTFOLIO - Distribution and Re-investment
14/07/201116:19BBTNIA - Nedbank Limited - Finalised distribution announcement in relation to
14/07/201116:14RAFISA - NewFunds eRAFI(TM) Overall SA Index ETF Portfolio - Distribution
14/07/201116:13RAFRES - Newfunds eRAFI(TM) SA Resource 20 Index ETF - Distribution Finalisation
14/07/201116:12RAFIND - Newfunds eRAFI(TM) SA Industrial 25 Index ETF - Distribution
14/07/201116:07 Vox - A firm intention to make an offer to acquire the entire issued share
14/07/201116:05 AngloGold Ashanti Limited - Anglogold Ashanti to sell mining area to
14/07/201116:00NFSH40 - Newfunds Shariah Top 40 Index ETF - Distribution Finalisation
14/07/201116:00 DRDGold Limited - Blyvoor Accepts Offer of Assistance from Anglogold
14/07/201115:58RAFFIN - Newfunds eRAFI(TM)SA Financial 15 Index ETF - Distribution Finalisation
14/07/201115:58KIOSIB - Standard Bank of South Africa Limited - Notice of expiry of Standard
14/07/201115:55THG - Trackhedge - Distribution finalisation announcement
14/07/201115:53NEWFSA - NEWFUNDS NEWSA Index Portfolio - Distribution finalisation announcement
14/07/201115:37GRT03 - Growthpoint Properties Limited - New Financial Instrument Listing
14/07/201114:20 PSV Holdings Limited - Financial effects of the disposal of Group Line
14/07/201112:56 Nictus Limited - Dealing in securities by Directors
14/07/201112:21 Famous Brands Limited - Dealings in securities
14/07/201112:05 BSI STEEL Limited - Dealing in securities by Directors
14/07/201112:00 Zurich Insurance Company South Africa Limited - Trading statement
14/07/201111:06BIIVU - iVuzi Investments Limited - Full Capital Redemption
14/07/201111:00INVS - Investec Bank Limited - Amendment to notice sent at 7h28 - Issue of
14/07/201110:54 Gold One International Limited - Update on AUD0.55 per share Cash
14/07/201109:24NBAGL1 - Nedbank Limited - Expiry and delisting announcement in relation
14/07/201108:56BBET40 - The BettaBeta Equally Weighted Top 40 portfolio - Distribution
14/07/201108:04DBXWD - db x-trackers MSCI World Index ETF - Distribution announcement - Six
14/07/201108:03DBXUS - db x-trackers MSCI USA Index ETF - Distribution announcement - Six
14/07/201108:02DBXUK - db x-trackers FTSE 100 ETF - Distribution announcement - Six months
14/07/201108:01DBXJP - db x-trackers MSCI Japan Index ETF - Distribution announcement - Six
14/07/201108:00DBXEU - db x-trackers DJ Euro Stoxx 50 ETF - Distribution announcement - Six
14/07/201107:28INVS - Investec Bank Limited - Issue of Autocall Index Warrants (Autocalls)
14/07/201107:15 Anglo American plc - Treasury Shares - Transfers
14/07/201107:10 British American Tobacco p.l.c - Transaction in own shares
14/07/201107:05 Metrofile Holdings Limited - Withdrawal of cautionary announcement

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