|
Related Topics |
|
We take a look at the Johannesburg Stock Exchange (JSE) trading statistics for the week ended 8 May 2020 and compare the numbers to that of a year ago.
South Africans are getting more or more frustrated with the lockdown, especially since lockdown Level 4 currently in effect does not allow for the purchase of cigarettes or alcohol |
|
Our highlight over the last week
Last week we covered the latest trade statistics that shows South Africa's imports from and exports to the rest of the world for March 2020
Top 5 countries South Africa exported to:
Top 5 countries South Africa exported to:
Trade Balance for March 2020: R 24,248,008 839
The image below shows South Africa's imports, exports and trade balance per month since the start of January 2010. And as the image shows the trade balance in March 2020 was the biggest positive trade balance over the course of this period.
Read the full article here
Top 5 countries South Africa exported to:
- Germany (11.2%)
- China (8.2%)
- United States (6.7%)
- United Kingdom (4.4%)
- Botswana (4.2%)
Top 5 countries South Africa exported to:
- Germany (11.9%)
- China (11.4%)
- United States (6.8%)
- Saudi Arabia (5.7%)
- India (5.5%)
Trade Balance for March 2020: R 24,248,008 839
The image below shows South Africa's imports, exports and trade balance per month since the start of January 2010. And as the image shows the trade balance in March 2020 was the biggest positive trade balance over the course of this period.
Read the full article here
JSE Trading Statistics for the week ending 8 May 2020
Number of trades:
Number of trades (2020): 1 807 408
Number of trades (2019): 1 235 253
% change year on year: 46.32%
Volume traded:
Volume traded (2020): 2 198 165 000
Volume of traded (2019): 1 041 149 000
% change year on year: 111.13%
Value of trades:
Value of trades (2020): R101 556 477 000
Value of trades (2019): R77 043 915 000
% change year on year: 31.82%
Foreign purchase/selling:
Net sales/Purchases (2020): R 4 348 549 000
Net sales/Purchases (2019): -R1 903 010 000
So year to date (YTD) foreigners have been net seller/buyers:
Net sales/Purchases (2020): -R28.025 billion
Net sales/Purchases (2019): -R28.767 billion
So a year ago foreigners were net sellers of SA listed shares to the value of -R28.767 billion for the YTD while this year they have been net sellers to the tune of -28.025 billion in the year to date (YTD). So foreigners remain massive sellers of SA listed stocks, and the pace of their selling seems to be increasing every year. Which is not good news for the Rand, which keeps getting pummeled.
With South Africa in lockdown the South African Reserve Bank estimated the direct impact of the 21 day lockdown to drag down GDP growth by -2.6%. So assuming the economy was set to grow by 0% this year, based on the bank's estimates the South African economy will shrink by 2.6% just due to the 21 day lockdown. So with the additional 2 weeks lockdown one can deduce that South Africa's economy will shrink by at least -4.3% due to the 35 day lockdown. And add to the fact that South Africa is now into its second week of Level 4 lockdown, which is almost as restrictive as full on national lockdown we now estimate the economy to contract by at -6.1%, if the lockdown is completely lifted tomorrow which it wont be, so the impact of the different lockdown levels is expected to continuing dragging South Africa's economy ever lower and deeper into recession and potentially depression.
The data above still shows that foreign capital is still leaving South African equities in vast amounts. This while the South African government continues to try and convince investors that South Africa is open for business. But the large scale corruption, poor government service delivery, slow economic growth, restrictive labour laws, worries about property rights, crime and general public disorder in the forms of strikes and looting are keeping potential investors away from South Africa.
JSE total market capitalisation:
Market Cap (2020): R16.083 trillion
Market Cap (2019): R15.957 trillion
% change year on year: 0.79%
So while the markets retreated by over 30% during March 2020, the recovery to levels before the Coronavirus triggered sell offs has happened pretty quickly in April. See our JSE Calendar tracker for more.
Key issues for the market and South Africa during 2020 will be:
Number of trades (2020): 1 807 408
Number of trades (2019): 1 235 253
% change year on year: 46.32%
Volume traded:
Volume traded (2020): 2 198 165 000
Volume of traded (2019): 1 041 149 000
% change year on year: 111.13%
Value of trades:
Value of trades (2020): R101 556 477 000
Value of trades (2019): R77 043 915 000
% change year on year: 31.82%
Foreign purchase/selling:
Net sales/Purchases (2020): R 4 348 549 000
Net sales/Purchases (2019): -R1 903 010 000
So year to date (YTD) foreigners have been net seller/buyers:
Net sales/Purchases (2020): -R28.025 billion
Net sales/Purchases (2019): -R28.767 billion
So a year ago foreigners were net sellers of SA listed shares to the value of -R28.767 billion for the YTD while this year they have been net sellers to the tune of -28.025 billion in the year to date (YTD). So foreigners remain massive sellers of SA listed stocks, and the pace of their selling seems to be increasing every year. Which is not good news for the Rand, which keeps getting pummeled.
With South Africa in lockdown the South African Reserve Bank estimated the direct impact of the 21 day lockdown to drag down GDP growth by -2.6%. So assuming the economy was set to grow by 0% this year, based on the bank's estimates the South African economy will shrink by 2.6% just due to the 21 day lockdown. So with the additional 2 weeks lockdown one can deduce that South Africa's economy will shrink by at least -4.3% due to the 35 day lockdown. And add to the fact that South Africa is now into its second week of Level 4 lockdown, which is almost as restrictive as full on national lockdown we now estimate the economy to contract by at -6.1%, if the lockdown is completely lifted tomorrow which it wont be, so the impact of the different lockdown levels is expected to continuing dragging South Africa's economy ever lower and deeper into recession and potentially depression.
The data above still shows that foreign capital is still leaving South African equities in vast amounts. This while the South African government continues to try and convince investors that South Africa is open for business. But the large scale corruption, poor government service delivery, slow economic growth, restrictive labour laws, worries about property rights, crime and general public disorder in the forms of strikes and looting are keeping potential investors away from South Africa.
JSE total market capitalisation:
Market Cap (2020): R16.083 trillion
Market Cap (2019): R15.957 trillion
% change year on year: 0.79%
So while the markets retreated by over 30% during March 2020, the recovery to levels before the Coronavirus triggered sell offs has happened pretty quickly in April. See our JSE Calendar tracker for more.
Key issues for the market and South Africa during 2020 will be:
- Exchange Rate (seems to be see sawing a lot. See our exchange rate page)
- Coronavirus and the impact it will have on not just Chinese demand for resources from South African commodity firms but the impact it will have on global trade, tourism, supply chains and ultimately global economic growth
- The pressure is starting to mount on the South African Reserve Bank with central banks across the world cutting rates in order to try and fight off the negative effects the Coronavirus has and will have on global demand and growth. The bank obliged and cut rates by a significant 100 basis points from 6.25% to 5.25%. In a shock move the Bank moved forward their May 2020 meeting to mid April and cut interest rates by a further 100 basis points.
- ESKOM's financial woes and continued loadshedding and weaker than expected tax collections is forcing government to borrow more money, which is negatively affecting the South African exchange rate, and potential credit rating cuts coming for South Africa's government which pushes up the cost of borrowing, and this at a time when government is borrowing more and more
- Expropriation of land without compensation (EWC) has gone quiet in recent months but we are sure the EFF will bring it up again soon to get some airtime
- Potential expansionary monetary policy coming considering the very weak economic growth numbers
- Sluggish economic growth. See our SA GDP page and high levels of unemployment
- SA being downgrade to junk status by Moody's. All three major ratings agencies now rate South Africa's government bonds as "junk status" or sub investment grade
- Impact of the Coronavirus on South Africa's economic growth
- Impact of the nation wide lockdown on employment and economic growth in South Africa and the slow (risk adjusted levels of lockdowns) and gradual reopening the country after a full lockdown. If not enough is done to open up firms to operate quicker its a fact that millions in South Africa will lose their jobs.