14 - 18 September 2015
A look at local and international economic data, major events, economic releases and company news expected in the week to come.
By Shaun Murison, Market Analyst
South African investment house, Brait SE, announced that it intends to raise 350 million pounds ($541 million) via a convertible bond for the funding of acquisitions. The company (also listed in Luxembourg), saw an intraday share price decline in excess of 10% following the news on Friday.
Anglo American Platinum Ltd (Amplats) announced that the company had entered into a Sale and Purchase agreement with Sibanye Gold Limited to sell its Rustenburg mining and concentrating operations. The sale will amount to at least R4.5bn, R1.5bn (cash or Sibanye shares) is to be paid upfront and the balance equalling 35% of free cash flow generated by these operations is to be paid over the next few years. The share price of Amplats reacted favourably to the news initially, although has fallen in the latter part of the week on renewed rand strength and underlying platinum price weakness.
Anglo American Plc (Anglos) finds itself on the opposite end of the top movers list to that of its platinum mining subsidiary Amplats. Accompanied by resource peers BHP Billiton and Kumba, Anglo’s gains follow a rebound to 10-week highs in the underlying price of iron ore. Markets are hopeful that renewed infrastructure spend from the Chinese government will boost demand for commodities, particularly that of the steel making ingredient.
Steinhoff International’s share price reacted favourably to the release of its FY 2015 results. Over the reporting period, revenue from continuing operations increased by 15% while headline earnings from continuing operations increased by 36%. The dividend offering has been increased by 10% and the Net Asset Value for the group has increased by 22% to R48.24 per share.
|14-Sep||Ad Tech Ltd||Ex-Dividend||R0.125|
|14-Sep||Adcock Ingram Holdings Ltd||Ex-Dividend||R0.81|
|14-Sep||Distell Group Ltd||Ex-Dividend||R1.88|
|14-Sep||Growthpoint Properties Ltd||Ex-Dividend||R0.445|
|14-Sep||Massmart Holdings Ltd||Ex-Dividend||R1.46|
Source: Economic Calendar, as of 11/09/2015
Mining production increased by 5.6% year-on-year in July 2015. The highest positive growth rates were recorded for Platinum Group Metals (PGMs), manganese ore, chromium ore and diamonds. The main positive contributors to the increase were from PGMs and manganese ore.
Iron ore (-8.6% and contributing -1.9 percentage points) and gold (-7.4% and contributing -1.2 percentage points) were significant negative contributors to the figure.
Manufacturing production increased by 5.6% in July 2015 compared with July 2014. This increase was mainly due to higher production in the following divisions:
In China, trade balance data revealed a $60.2bn surplus for August 2015. Exports for the month declined by 6.1% while imports for the month fell by 13.8% to realize the trade surplus figure.
In the U.K., the Monetary Policy Committee (MPC) meeting yielded little in the way of surprises as the official bank rate was left unchanged at 0.50%.
In the U.S., jobless claims data showed 275 000 people to have filed for unemployment benefits in the previous week, which less than what was forecast as well as the previous weeks figure.
The week ahead
The moment markets have been anticipating will be realized in the new week, at the Federal Open Market Committee (FOMC) meeting on Thursday. Market volatility is likely to climax into the meeting as we await the answer to the question “Will the Fed raise rates in September?” when the central bank announces changes (if any) to the Federal funds rate. Inflation data out of the U.S. on the Wednesday, which precedes the event, is also likely to influence the rates decision and will be closely monitored.
|13-Sep||07:30||CNY||Industrial production y/y||6.30%||6.00%|
|15-Sep||11:00||EUR||German ZEW economic sentiment||-||25|
|15-Sep||14:30||USD||Core retail sales m/m||-||0.40%|
|15-Sep||14:30||USD||Retail sales m/m||-||0.60%|
|16-Sep||10:30||GBP||Average earnigs index 3m/y||-||2.40%|
|16-Sep||13:00||SA||Retail trade sales y/y||-||3.50%|
|16-Sep||14:30||USD||Core CPI m/m||-||0.10%|
|17-Sep||10:30||GBP||Retail sales m/m||-||0.10%|
|17-Sep||16:00||USD||Philly Fed manufacturing index||-||8.3|
|17-Sep||20:00||USD||FOMC economic projections||-||-|
|17-Sep||20:00||USD||Federal funds rate||<0.50%||<0.25%|
|17-Sep||20:30||USD||FOMC press conference||-||-|
|17-Sep||10:00||SA||Wholesale trade sales y/y||-||0.40%|
|17-Sep||11:30||SA||Motor trade sales y/y||-||2.80%|
Source: Economic Calendar, as of 11/09/2015
IG provides an execution-only service. The material on this website does not contain (and should not be construed as containing) investment advice or an investment recommendation, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. This communication must not be reproduced or further distributed. The price levels provided are derived from ProRealtime Charts (IT-Finance)
Source: INET BFA, as of 11/09/2015