NASTASSIA ARENDSE: Good evening and welcome to the SAfm Market Update with Moneyweb with me, Nastassia Arendse.
To take us through how the day’s market performance is David Shapiro from Sasfin Wealth. David, how did the market do today?
DAVID SHAPIRO: All over the place. At one time, when the US inflation numbers came they were worse than expected. Our market plunged from being in positive territory to deep into negative territory. It was almost a perpendicular flight downwards of about 1%. But, as the session continued, we actually clawed our way back.
I think generally markets are recovering. As I look now, it’s strange to see the rand very strong. At one point the rand was a bit weak, but it seems to be picking up steam now. I’m not quite sure whether that is dollar weakness. It’s very difficult to interpret what’s happening on markets because they are so fluid.
But just to give you a scorecard on how markets closed here, or just to go over it, we ended up 0.3%. Miners were under a little bit of pressure. I’m having difficulty understanding the mining market because broadly with the weaker dollar commodity prices were better. Yet I think we were influenced by more or less specific instances like Gold Fields, which came down 3.5%. That was on production results.
And then Sasol was down 1.5%, I think also on the lower oil price.
Among those worrying me is Assore. Assore is an iron-ore and manganese producer. That fell about 6%. If you measure it over the last month, we’ve lost about 30%. I think what’s troubling the market is that the rand is very strong, which is going to hurt them. Also there are concerns about the sustainability of iron-ore prices, even though they are holding up.
Similarly we’ve seen Kumba, which is down about 0.5% today. If you look, after the last month it’s about 18%. So that kind of gives you an idea of what’s happening on some of the commodity markets. It’s difficult to read where they are going to go.
But it we look at our industrial market, all the energy is in consumer stocks here. Bidcorp, which has fallen now, seems to be attracting a lot of interest from institutions and local investors – up about 5.5%. Distell up 4%. Dis-Chem, Foschini, Clicks all up around 3%.
Not much happening on the heavyweight division. Naspers up 2%, Richemont, AB InBev, Bidvest, Mondi all trading lower. And yet that could be a rand issue because I think if you look in their home market – I’m talking mainly of Europe – most of those shares seem to be strong.
And financials – Viceroy firing another shot at Capitec, maintaining its position that Capitec should impair its rescheduled loan. So Capitec was down 4%. PSG came down 2.5% also, in line with Capitec. But overall not much to talk about in financials.
And then property stocks are under pressure. The Resilient Group is still facing a lot of selling and also trying to restore its reputation in the market. Reports making certain allegations that UZASHONS against the company re circulating. So we saw Fortress B down about 10%, Resilient down 6%.
But I think consumer shares have been the winners.