JSE heads back to record territory
The JSE’s all share index rebounded back above 56,000 points on Tuesday after gaining 1.05%, led higher by grocery chain Shoprite, which closed 8% higher at R217.11.
The all share index has closed above 56,000 only once before, on August 7.
The JSE top 40 index has been flirting with the 50,000-point barrier for the past few weeks, and closed 0.83% short of clocking this level for the first time.
Statistics SA is scheduled to release July’s consumer price index (CPI) at 10am today. Inflation, as measured by the annual change in CPI, is the primary factor used by the Reserve Bank to set its repo rate.
Investec Bank economist Kamilla Kaplan has said she expects July’s CPI report to show a sixth consecutive month of falling inflation. She predicts inflation slowed to 4.7% in July from 5.1% in June.
"Food price inflation has been moderating on the alleviation of the drought effects, whilst petrol and diesel prices decreased by a substantial 68c and 60c per litre respectively in July," Kaplan wrote in her weekly economics forecast e-mailed on Friday.
"July is also the measurement month for electricity prices. The National Energy Regulatory (Nersa) granted Eskom only a 2.2% tariff increase this year, compared with the 9.4% increase in 2016. As such, the contribution from the electricity component to monthly and headline CPI will be negligible compared with the prior year," she said.
Wednesday is another busy day for JSE market watchers, with Grindrod, Murray & Roberts, Brimstone and Transpaco scheduled to release results.
Logistics group Grindrod said in a trading statement on August 15 it expected to report that its headline loss per share for the six months to end-June narrowed by between 64% and 69% from the matching period’s 50.8c headline loss per share.
The loss was mainly due to a R255m impairment of its rail assembly business, the trading statement said.
The group said it had benefited from stronger mineral commodity exports. Its ports and terminals division recorded satisfactory profits and its shipping division recovered to above cash breakeven following a strengthening of dry bulk shipping rates.
Grindrod’s empowerment partner, Brimstone, is also releasing its interim results on Wednesday.
Brimstone said on Tuesday that it expected to report a basic headline loss per share of between 92.2c and 110.6c, compared with basic headline earnings per share of 11.5c reported for the six months to end-June 2016.
Murray & Roberts said in a trading statement on August 17 that it expected to report that its Middle East arm contributed a R570m loss.
Excluding the loss from its Middle East business — which "is to be abandoned", the trading statement said — diluted headline earnings per share (HEPS) would be in the range of R2.06 to R2.16, or between 5% and 10% higher than the prior year’s R1.97.
But including the loss contributed by the Middle East operation, diluted HEPS falls to between 66c and 76c, less than half the prior year’s R1.78 excluding losses contributed by the Middle East in 2016.
On Tuesday, Murray & Roberts announced it is raising its ownership of the Gautrain from 33% to 50% in a R405m deal.
Murray & Roberts owns the Gautrain in a partnership, Bombela Concession Company, with French construction group Bouygues Travaux, the UK arm of Canadian train and aircraft maker Bombardier Transportation, and an empowerment group called Loliwe Rail Contractors.
Tuesday’s statement said Bouygues and Bombardier had decided to divest from the Gautrain by each selling their remaining 8.5% of Bombela to Murray & Roberts.
M&R’s results are due at about 5pm on Wednesday.
Packaging group Transpaco said in a trading update on August 14 that it expected to report HEPS for the year to end-June decreased by between 18% and 23%.