3 - 7 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
For the six months ending June 30, British American Tobacco Plc results showed group revenue to be up by 2.4% at constant rates of exchange, driven by good pricing. The reported revenue however was 5.9% lower as a result of adverse exchange rate movements. Basic earnings per share was 52.6% higher at 142.4p (2014: 93.3p), benefiting from gains as a result of the acquisition of Lorillard Inc. by the Group’s associate Reynolds American Inc.
Reinet Investments would have gained over the last week, as its primary asset holding is that of British American Tobacco Plc. Brait SE continues to defy gravity as it remains in the top gainers list once again as it has every week since being incorporated into the JSE Top 40 index (despite the absence of any new news relating). Brait SE is set to go ex-dividend on Monday the 3rd of August 2015.
Kumba Iron Ore has started to rebound from the depths of its multi-year lows following a rebound in iron ore as rumors surface in China that steel makers have been ordered to cut production.
The top decliners list sees a week where industrial counters have come under pressure. The MTN Group saw a sharp sell-off in its share price, following the release of a trading statement, in which the company guided that it expects headline earnings per share for the interim period to be 10% to 15% lower than the comparative 6-month period in 2014.
The decline in earnings follows a weaker Naira in Nigeria, MTN’s largest market. Naspers continues to react to market volatility in Asia, falling in sympathy with its Hang Seng listed counterpart Tencent Holdings.
|03-Aug||Peregrin Holdings Ltd||Ex-Dividend||R1.50|
|03-Aug||Brait SE (SA)||Ex-Dividend||R0.0589|
|05-Aug||MTN Group Ltd||Half-year earnings release||n/a|
|06-Aug||Old Mutual PLC (SA)||Half-year earnings release||n/a|
|06-Aug||SABMiller PLC (SA)||Q2 2016 trading statement release||n/a|
|06-Aug||Old Mutual PLC (SA)||Half-year 2015 earnings||n/a|
|07-Aug||Sappi Ltd||Q3 2015 earnings release||n/a|
|07-Aug||Liberty Holdings Ltd||Interim 2015 earnings release||n/a|
Source: Economic Calendar, as of 31/07/2015
The unemployment rate in South Africa fell to a level of 25.0% in 2Q15. The unemployment rate had registered a reading of 26.4% in the previous quarter.
On an annualised basis, the Producer Price Index (PPI) showed inflation at a factory level to have increased by 3.7%, in June 2015, slightly less than the consensus of estimates had predicted (3.9%). The PPI had recorded a rise of 3.6% in the previous month.
Private sector credit increased 8.14% on an annualised basis in June 2015, below market expectations predicting a 9.27% increase. Private sector credit registered a revised increase of 9.42% in the prior month.
In the U.S., the Federal Open Market Committee (FOMC) meeting revealed little in terms of certainty as to when policy makers would commence with monetary tightening in the world’s largest economy. While progression in economic conditions were cited as favourable on a number of fronts (including the labour market and wage improvements), the lacklustre level of inflation at present remained a headwind for the Federal Reserve. Advance Gross Domestic Product (GDP) data released for the region came in slightly below expectation with q/q growth being reported at 2.3% (est. 2.6%).
In the U.K, Preliminary GDP data showed growth for the second quarter realised at 0.7% q/q, which was in line with expectations.
The week ahead
Non-Farm employment change data out of the U.S. (on Friday) will once again be the dominant economic data point scheduled for the week, preceded by U.S trade balance data on Wednesday, and ISM Manufacturing PMI data on Monday.
At home, a quiet economic calendar will perhaps be overshadowed by the corporate calendar where blue chip companies Nedbank, MTN, Old Mutual and Liberty Holdings are scheduled to release interim results.
|03-Aug||03:45||CNY||Caixin final manufacturing PMI||48.2|
|03-Aug||16:00||USD||ISM manufacturing PMI||53.5|
|05-Aug||14:15||USD||ADP non-farm employment change||237K|
|05-Aug||16:00||USD||ISM non-manufacturing PMI||56|
|05-Aug||09:15||SA||HSBC whole economy PMI||49.2|
|05-Aug||11:30||SA||Business confidence index||84.6|
|06-Aug||10:30||GBP||Manufacturing production m/m||-0.60%|
|06-Aug||13:00||GBP||BOE inflatoin report||-|
|06-Aug||13:00||GBP||MPC official bank rate votes||0-0-9|
|06-Aug||13:00||GBP||MPC rate statement||-|
|06-Aug||13:45||GBP||BOE Gov Carney speaks||-|
|07-Aug||14:30||USD||Non-farm employment change||223K|
|07-Aug||08:00||SA||Gold & foreign exchange reserves (gross)||$46.83B|
|07-Aug||08:00||SA||Gold & foreign exchange reserves (net)||$41.59B|
Source: Economic Calendar, as of 31/07/2015
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Source: INET BFA, as of 31/07/2015