Unum Market Commentary: JSE and USA Closes Weaker While Asia Buc
South African equity markets continued to trade with a downside bias, this time being held back by financial sector as stocks such as Firstrand, Standard Bank and Absa fell sharply. For the session, the All Share declined by 0.40% while the Top 40 index shed 0.45%. On the upside, winners included British American Tobacco benefited as the US Food and Drug Administration announced that that they have given JUUL and four other makers of flavored e-cigarette 60 days to submit plans to curb the use of their products by youths or risk having them pulled from the market. This came as a positive for the BTI share price which closed the session 5.26% higher. In Europe, markets closed in the green with the DAX, FTSE100 and CAC40 adding 0.52%, 0.55% and 0.92% respectively. Overnight, US markets closed weaker, while this morning Asian equities are bouncing back strongly on the back of a slightly weaker US Dollar. With Tencent having been oversold and showing signs of recovery in the US last night, the stock is up nearly 3% in Hong Kong today, which increases the likelihood of a firmer open on the JSE today. The ALSI, having traded at the bottom of the range, could find support and rebound at this range low.
JSE Major Sectors
Resources 10 +0.77%
Industrial 25 -0.60%
Financial 15 -1.36%
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It's a data-heavy Thursday on the international economic calendar, with Australia having reported strong job growth, while later we also have releases out of the UK, Eurozone and USA. You may view the Unum Capital Economic Calendar by clicking on this link: unum.co.za/economic-calendar/
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In currencies, the South African Rand trades as follows:
USDZAR -0.03% to 14.95
GBPZAR -0.08% to 19.50
EURZAR -0.01% to 17.38
Gold trades at $1210
Platinum at $803
Brent Crude Oil at $79.30
International Markets
This morning, Asian equities are as follows:
Nikkei 225 (+0.90%)
Hang Seng (+1.17%)
Shanghai Composite (-0.03%)
Latam Markets closed as follows:
Merval 25 (+1.99%)
Bovespa (+0.63%)
INMEX (+0.88%)
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Company News
QUANTUM FOODS HOLDINGS LIMITED - Trading Statement
In terms of the Listings Requirements of the JSE Limited, a listed company is required to publish a trading statement once it is satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported on next will differ by at least 20% from the financial results for the previous corresponding period.
Shareholders are hereby advised that for the twelve-month period ending 30 September 2018, a reasonable degree of certainty exists that:
• headline earnings per share (HEPS) of the Company will be at least 219% or 107.5 cents per share higher than reported in the comparable period; and
• earnings per share (EPS) of the Company will be at least 181% or 100.6 cents per share higher than reported in the comparable period.
This implies that for the twelve months ending 30 September 2018:
• HEPS is expected to be at least 156.5 cents per share, compared to HEPS of 49.0 cents per share reported in the comparable period ending 30 September 2017; and
• EPS is expected to be at least 156.3 cents per share, compared to EPS of 55.7 cents per share reported in the comparable period ending 30 September 2017.
HEPS for the first six months of 2018 was 82.5 cents per share and EPS for the first six months of 2018 was 82.4 cents per share. Earnings expected for the second six months of the 2018 financial year compared to the first six months of the 2018 financial year was impacted by:
• Continued high levels of profitability in the egg business, although margins declined with an increase in feed costs and a decline in egg prices;
• Proceeds of R22 million, received from insurers compensating partly for the Avian Influenza losses that occurred in 2017 and in the first half of 2018;
• Slightly weaker margins in the feeds and broiler farming businesses; and • Improved contribution from the other African operations benefiting from the favourable trading conditions.
A further trading statement will be issued as soon as there is a reasonable degree of certainty as to the likely range within which the Company’s HEPS and EPS is expected to increase.
Shareholders are advised that no further incidents of Avian Influenza have been experienced. Shareholders are reminded that an outbreak of Avian Influenza before the end of the reporting period could have a significant impact on the expected HEPS and EPS reflected in this trading statement. The results for the twelve months ending 30 September 2018 is expected to be published on SENS on or about 29 November 2018.
The financial information on which this trading statement is based, has not been reviewed or reported on by the Company’s external auditors.
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Aus miners:
BHP Billiton (+1.03%)
Rio Tinto (+1.96%)
S32 (+1.51%)
FANGs
Facebook (-2.37%)
Amazon (+0.14%)
Netflix (+3.94%)
Google (-1.55%)
FTSE Miners:
Anglo American plc (+1.29%)
BHP Billiton plc (+1.44%)
Glencore plc (+2.86%)
Alibaba Holdings (+2.54%)
Tencent Holdings (+2.72%)
Share Link: bit.ly/JoinUnum
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The Unum Capital Trading Desk
For anty trading related queries, please contact the Unum Trading desk : 011 384 2929
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