|
Related Topics |
|
In our continued efforts to give our readers a broad number of views, opinions and information, we continue to provide PSG's daily market updates and add our own daily inputs in at the end.
|
|
Short summary of PSG's market commentary for 28 October 2019
South Africa
The JSE closed lower on Friday as investors adopted a wait-and-see approach ahead of key events set to take place this week.
United States
The S&P 500 on Friday rose above its record closing high after Washington said it was close to finalising parts of a trade pact with Beijing. At 19h30, the S&P 500 traded up by 0.48%.
Europe
A late turnaround helped European stocks notch gains on Friday, as signs of progress in US-China trade talks and upbeat reports from luxury goods makers dispelled some fears about an earnings and growth slowdown. After the JSE closed the FTSE 100 was flat, France’s CAC 40 rose 0.67%, and Germany’s DAX 30 0.17%.
Hong Kong
Hong Kong stocks fell on Friday, as investors braced for uncertainty ahead of fresh US-China trade talks, local protests and the US Federal Reserve’s rate decision later this week. At the close of trade, the Hang Seng index was down 0.49%.
Japan
Japanese shares inched up on Friday as some positive earnings from overseas tech companies offset growth concerns, with semiconductor-related stocks leading the gainers. The Nikkei average rose 0.22%.
Rand
The rand was firmer against major global currencies on Friday amid progress in the US-China trade war and a possible date for another UK snap election. At 19h30, a dollar traded at R14.61.
Precious metals
Gold rose on Friday, holding above the $1 500/oz psychological level, as weak US economic data spurred expectations for another interest rate cut by the Federal Reserve later in October.
Oil
Oil prices fell on Friday but were on track for strong weekly gains as support from a surprise draw in US inventories and possible action from oil cartel Opec and its allies to trim production further outweighed broader economic concerns.
The JSE closed lower on Friday as investors adopted a wait-and-see approach ahead of key events set to take place this week.
United States
The S&P 500 on Friday rose above its record closing high after Washington said it was close to finalising parts of a trade pact with Beijing. At 19h30, the S&P 500 traded up by 0.48%.
Europe
A late turnaround helped European stocks notch gains on Friday, as signs of progress in US-China trade talks and upbeat reports from luxury goods makers dispelled some fears about an earnings and growth slowdown. After the JSE closed the FTSE 100 was flat, France’s CAC 40 rose 0.67%, and Germany’s DAX 30 0.17%.
Hong Kong
Hong Kong stocks fell on Friday, as investors braced for uncertainty ahead of fresh US-China trade talks, local protests and the US Federal Reserve’s rate decision later this week. At the close of trade, the Hang Seng index was down 0.49%.
Japan
Japanese shares inched up on Friday as some positive earnings from overseas tech companies offset growth concerns, with semiconductor-related stocks leading the gainers. The Nikkei average rose 0.22%.
Rand
The rand was firmer against major global currencies on Friday amid progress in the US-China trade war and a possible date for another UK snap election. At 19h30, a dollar traded at R14.61.
Precious metals
Gold rose on Friday, holding above the $1 500/oz psychological level, as weak US economic data spurred expectations for another interest rate cut by the Federal Reserve later in October.
Oil
Oil prices fell on Friday but were on track for strong weekly gains as support from a surprise draw in US inventories and possible action from oil cartel Opec and its allies to trim production further outweighed broader economic concerns.
Advertisement (and yes South Africans can buy from Amazon as they deliver to SA)
Our daily update
Struggling fast food and restaurant retailer Famous Brands released their latest results. Below a summay of their latest results
FINANCIAL PERFORMANCE/HIGHLIGHTS
Revenue - R3.6 billion
Headline earnings per share - 159 cents
Operating profit - R405 million
Operating profit margin - 11.3%
Interim dividend per share - 90 cents
COMMENTARY OVERVIEW
Famous Brands is Africa's leading food services franchisor. The Group's vertically integrated business model comprises a portfolio of 20 restaurant brands, represented by 2 879 restaurants across South Africa (SA), the rest of Africa and the Middle East (AME), and the United Kingdom (UK). The Brands division is underpinned by substantial Logistics and Manufacturing operations. OPERATING ENVIRONMENT Across our trading markets, consumer behaviour continued to be driven by the demand for convenience, value, and enhanced brand experiences. SA Locally, consumer and business confidence remained at low levels throughout the review period. Sustained financial hardship and subdued economic growth were exacerbated by country-specific risk factors which continued to cause general socio-political uncertainty and discontent. UK Uncertainty arising from the recent change in political leadership as well as progress regarding Brexit weighed heavily on consumer sentiment and spend during the review period.
GROUP PERFORMANCE
The business delivered solid results in a challenging environment. Particularly pleasing was the good performance reported in the Brands division. Disappointingly, this improved performance did not pull through to the Supply Chain, which experienced weaker sales and significant margin pressure. Rewarding progress was achieved across our key strategic focus areas: - to ensure that the total value chain delivers franchisee profitability; - to entrench the gold standard in the GBK Restaurants Limited (GBK) business resulting in a more focused and relevant offering and an improvement in costs and efficiencies; and - to focus on working capital management; ensure the best return on investment in key areas of the business; and exit non- core business.
Read more about Famous Brands here
FINANCIAL PERFORMANCE/HIGHLIGHTS
Revenue - R3.6 billion
Headline earnings per share - 159 cents
Operating profit - R405 million
Operating profit margin - 11.3%
Interim dividend per share - 90 cents
COMMENTARY OVERVIEW
Famous Brands is Africa's leading food services franchisor. The Group's vertically integrated business model comprises a portfolio of 20 restaurant brands, represented by 2 879 restaurants across South Africa (SA), the rest of Africa and the Middle East (AME), and the United Kingdom (UK). The Brands division is underpinned by substantial Logistics and Manufacturing operations. OPERATING ENVIRONMENT Across our trading markets, consumer behaviour continued to be driven by the demand for convenience, value, and enhanced brand experiences. SA Locally, consumer and business confidence remained at low levels throughout the review period. Sustained financial hardship and subdued economic growth were exacerbated by country-specific risk factors which continued to cause general socio-political uncertainty and discontent. UK Uncertainty arising from the recent change in political leadership as well as progress regarding Brexit weighed heavily on consumer sentiment and spend during the review period.
GROUP PERFORMANCE
The business delivered solid results in a challenging environment. Particularly pleasing was the good performance reported in the Brands division. Disappointingly, this improved performance did not pull through to the Supply Chain, which experienced weaker sales and significant margin pressure. Rewarding progress was achieved across our key strategic focus areas: - to ensure that the total value chain delivers franchisee profitability; - to entrench the gold standard in the GBK Restaurants Limited (GBK) business resulting in a more focused and relevant offering and an improvement in costs and efficiencies; and - to focus on working capital management; ensure the best return on investment in key areas of the business; and exit non- core business.
Read more about Famous Brands here
Our JSE All Share index daily performance calendar
Visit our JSE Calendar tracker page for a expanded version of the calendar below
The graphic below provides the daily returns of the JSE All Share Index (J203) on a calendar chart. Provides a great overview of the All share index over the course of the month. It will be updated daily with our daily investment update as received from PSG.
So for the month September 2019 the JSE All Share Index ended the month down -2.01%. Midway through the trading month of October 2019 and the JSE All Share Index is up by 1.28%. Question is whether it can hold on to the gains made for the rest of the month. There seems to be a softening of the trade wars rhetoric as both the USA and China looks to avoid further damage being caused to their economies and it looks like the UK might be striking a deal with the EU to leave the EU. Seems Brexit might finally be happening (unless the UK parliament delays matters and more extensions to the Brexit deadline is required)
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article
For more on daily market movements see our 2019 Calendar tracker.
But we as South African investors are losing out in Dollar terms. Largely due to continued Rand weakness not only over the short term but over the last couple of years. We continue to advise investors to take money out of South Africa and invest it offshore. Looking for ideas for investments to make? Go read this article