24 - 28 August 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
It has been a tough week for markets, which continue to digest Chinese induced fears of slowing economic growth and deflation in conjunction with mostly weaker macro data reported globally.
Saudi Arabia and Iraq maintaining oil production at record levels, combined with the threat of Iranian crude exports entering the market, have weighed significantly on the price of crude oil. High levels of crude inventory being reported out of the U.S. in the last week has also added to the bearish sentiment for the commodity.
The impact of a falling oil price has negatively affected locally listed oil producer Sasol and telecommunications company MTN. MTN which derives the bulk of group earnings from oil producing nation Nigeria, falls victim to the potential economic impact of the declining commodity price. In addition emerging market woes have seen the Nigerian Naira depreciate more than the Rand, which could provide a negative contribution to earnings when repatriated to South Africa.
A relatively sparse gainers list tells the story of a difficult trading week.
The last remaining dedicated Platinum Group Metal (PGM) miner (Anglo Platinum) and gold miner (AngloGold Ashanti) in the Top 40 index, take top honours in terms of share price gains this last week.
Furthering gains realised over the last week from renewed safe haven demand for gold, AngloGold Ashanti saw strong gains in its share price following the release of its interim results. Amidst tough economic conditions the miner has managed to reduce all-in-sustaining costs to $928/oz (12%) while maintaining production levels ahead of guidance. The company also appears to be making headway in terms of reducing the large levels of debt which have haunted it over the last while.
|24-Aug||Oceana Group Ltd||Corporate actions||n/a|
|24-Aug||Anchor Group Ltd||Ex-Dividend||R0.11|
|24-Aug||Merafe Resources Ltd||Ex-Dividend||R0.01|
|24-Aug||MTN Group Ltd||Ex-Dividend||R4.80|
|24-Aug||Super Group Ltd||Full-year 2015 results||n/a|
|24-Aug||Sun International Ltd||Full-year 2015 results||n/a|
|26-Aug||Adcock Ingram Ltd||Full-year 2015 results||n/a|
|26-Aug||Growthpoint Properties Ltd||Full-year 2015 results||n/a|
|26-Aug||Imperial Holdings Ltd||Full-year 2015 results||n/a|
|26-Aug||Murray & Roberts Ltd||Full-year 2015 results||n/a|
|26-Aug||Santam Ltd||Interim 2015 results||n/a|
|27-Aug||Assore Ltd||Full-year 2015 results||n/a|
|27-Aug||Massmart Holdings Ltd||Interim 2015 results||n/a|
|27-Aug||Woolworths Holdings Ltd||Full-year 2015 results||n/a|
Source: Economic Calendar, as of 21/08/2015
Measured in nominal terms (current prices), motor trade sales increased by 2.8% year-on-year in June 2015. The highest annual growth rates were recorded for sales of accessories (9.3%), new vehicle sales (6.3%) and workshop income (4.7%).
Measured in real terms (constant 2012 prices), wholesale trade sales increased by 0.4% year-on-year in June 2015. Seasonally adjusted wholesale trade sales decreased by 0.5% in June 2015 compared with May 2015. This followed month-on-month changes of 3.4% in May 2015 and -6,0% in April 2015.
Measured in real terms (constant 2012 prices), retail trade sales increased by 3.5% year-on-year in June 2015. The highest annual growth rates were recorded for retailers in:
The headline CPI (for all urban areas) annual inflation rate in July 2015 was 5.0%. This rate was 0.3 of a percentage point higher than the corresponding annual rate of 4.7% in June 2015. On average, prices increased by 1.0% between June 2015 and July 2015.
In the U.S., Consumer Price Index (CPI) data and Core CPI data fell short of consensus showing inflation in both index baskets to be marginal at 0.1% m/m. Weekly jobless claims data saw more people claiming unemployment benefits than was expected. The highly anticipated Federal Open Market Committee (FOMC) meeting minutes saw comments from some Federal Reserve members suggesting that the outlook for inflation remained muted. Expectations for a September rate hike have diminished following the news as well as China’s recent currency devaluation threatening deflationary pressures in the U.S.
In China, Caixin Manufacturing PMI index data added to fears of an economic slowdown in the world’s second largest economy. The index reading came in at 47.1, alluding to industry contraction larger than that of the previous month (47.8) as well as that which was forecast (48.1).
The week ahead
The new week will continue to focus on the state of global economic growth. Local Gross Domestic Product (GDP) data is scheduled for release on Tuesday, while U.S. Preliminary GDP is scheduled for Thursday and Second GDP estimates out of the U.K. are scheduled for Friday.
|25-Aug||10:00||EUR||German Ifo business climate||108|
|25-Aug||16:00||USD||CB consumer confidence||90.9|
|26-Aug||14:30||USD||Core durable goods orders m/m||0.60%|
|27-Aug||14:30||USD||Prelim GDP q/q||2.30%|
|28-Aug||10:30||GDP||Second estimate GDP q/q||0.70%|
|28-Aug||14:30||USD||Goods trade balance||-62.3B|
Source: Economic Calendar, as of 21/08/2015
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Source: INET BFA, as of 21/08/2015