SIKI MGABADELI: Good evening and welcome to the SAfm Market Update with Moneyweb. My name is Siki Mgabadeli.
It’s winter and it’s been bitterly cold in many parts of the country over the past few days and some residents have complained about power outages, despite Eskom and the President telling us that there will be no load-shedding. So we are going to find out from City Power, because there’ve been quite a few complaints in social media about power outages in Johannesburg, specifically in parts of the northern suburbs. We will speak to City Power about that.
Then we are going to talk about what Fincheck.co.za is calling a “blame game” between borrowers and lenders in South Africa. They are saying that neither party wants to take responsibility for their borrowing and lending decisions and that is what’s been fuelling the escalating spiral into debt in this country.
In this week’s SME Corner Tumisang Ndlovu speaks to the founder of Energy House, Noxolo Kahlana.
David Shapiro of Sasfin is watching the markets for us today. But first, Tumisang has your business news headlines.
TUMISANG NDLOVU: Thanks, Siki. Good evening.
Analysts say South African retail stocks are set for the longest losing streak in six months as weak growth prospects for the economy cast doubts over consumers’ ability to spend. This comes as the country’s retail sales slowed in April, showing growth of only 1.5%. That’s after expanding by a revised 2.9% in March, according to the latest data from Statistics South Africa.
The rand remains under pressure along with other emerging market currencies, reacting to uncertainty over the upcoming Brexit referendum expected next week. Lehumo Capital’s MD, Maudi Lentsoane adds that the local currency is also reacting to expectations from the US Federal Reserve meeting today which is expected to announce its decision on rates.
MAUDI LENTSOANE: The possibility of Britain leaving the Eurozone – that’s a big one coming through next week on 23rd. The Fed announcement that’s coming out as well, another event risk. Of course, the market expects the Fed to remain on hold, especially because with the job numbers that came out we are slightly weaker. But it just means that they are postponing. Eventually we will have to deal with the Fed having to hike at some stage.
TUMISANG NDLOVU: And finally, weak demand continues to dog the South African manufacturing sector. According to the Absa Manufacturing Survey released today, the output indicator is stuck in negative territory for the sixth consecutive quarter, while employment fell to multi-year lows.
Financial indicators this hour: the rand is at R15.26/dollar, R21.63/pound and R17.17/euro. Gold is at $1 284.70/oz, platinum at $977/oz and Brent crude oil at $49.30/barrel.
More on these stories and other business news on our website.