Exxon sees volatile Q3 earnings amid oil swings, stronger refining margins, and restructuring costs

South Africa

The local Top 40 index added 0.12% yesterday to reach 102,817.2 points, while the All Share index gained 0.13% to close at 109,925.9 points. Investors await SA gold and forex reserves and manufacturing data for economic signals. Meanwhile, diplomatic tensions have flared as South Africa downgraded Taiwan’s representation, prompting backlash after attempts to remove its de facto ambassador. Separately, SA issued a flight permit to Abakan Air, a US-blacklisted Russian operator, claiming ignorance of sanctions. The plane landed with cargo and departed empty, raising eyebrows amid geopolitical scrutiny. With China as SA’s top trade partner, such actions highlight Pretoria’s delicate balancing act amid increasing global geopolitical pressures.

European Union

European stocks steadied after early losses from French PM Sebastien Lecornu’s surprise resignation, with the STOXX 600 closing flat. French markets dropped sharply, and bond yields spiked as political uncertainty re-emerged. However, a rally in semiconductor shares—following AMD's supply deal with OpenAI—helped offset losses, lifting BESI and ASML. Oil and gas stocks also rose after OPEC+ announced a smaller-than-expected output increase. Despite France's political instability, the broader European market showed resilience, reflecting investor focus on tech and energy tailwinds amid mixed macro signals.

United States

The S&P 500 and Nasdaq hit record closes, buoyed by AMD's AI chip deal with OpenAI, which sent AMD shares soaring 23.7%. The government shutdown entered its sixth day, delaying key economic data and increasing investor reliance on secondary indicators. Despite inflationary concerns, markets are pricing in a 94.6% chance of a 25bps Fed rate cut in October. With earnings season approaching, analysts expect 8.8% year-on-year S&P 500 profit growth. Financials will kick off reporting next week, providing fresh direction in a data-light environment due to the shutdown.

Asia

Japan’s Nikkei 225 hit consecutive record highs, driven by tech sector optimism after AMD’s OpenAI deal. Major chipmakers like Advantest and Renesas posted strong gains. Political shifts also supported sentiment, with conservative Sanae Takaichi poised to become Japan's first female prime minister. Bond yields surged, reaching multi-decade highs, while household spending data surprised to the upside. Despite Takaichi’s dovish fiscal stance, data supports the Bank of Japan’s gradual tightening approach. Overall, optimism over tech and a resilient economy are bolstering Japanese markets amid broader global uncertainties.

Currencies

The South African rand weakened as global uncertainty over the U.S. shutdown lingered. In Japan, the yen dropped to a two-month low versus the dollar and hit an all-time low against the euro as fiscal dove Sanae Takaichi ascended politically. Japanese officials warned of excessive market movements. The euro remained fragile after France’s PM resigned, while ECB members hinted at possible rate cuts. With official U.S. data limited due to the shutdown, traders are closely monitoring speeches from Fed officials for clues on future monetary policy direction.

Commodities

Gold surged to a record high amid U.S. government shutdown concerns and rising bets on an imminent Fed rate cut. Oil prices also climbed, supported by OPEC+’s modest November output hike of 137,000 barrels per day—far lower than expected. Though supply from non-OPEC+ producers continues to rise, geopolitical tensions, including Russia’s refinery fire following a drone strike, are helping stabilize prices. Still, global economic risks, such as U.S. tariffs and slowing growth, could weigh on future demand and pressure prices if supply continues to outpace consumption.

Mondi plc (MNP) -16.48%

Mondi plc reported Q3 2025 underlying EBITDA of €223 million, including a €20 million forestry fair value gain, amid continued market softness. Lower sales volumes and declining paper prices impacted both Corrugated and Flexible Packaging segments, while Uncoated Fine Paper faced significant demand and pricing pressure. The Group remains focused on cost control, operational efficiency, and cash generation, having completed its major capex cycle. Mondi reorganised into two units—Corrugated and Flexible Packaging—and is integrating the Schumacher acquisition, now targeting €32 million in synergies. While near-term headwinds persist, Mondi is strategically positioned to benefit from future market recovery.

Sirius Real Estate Limited (SRE) -1.11%

For the half-year ended 30 September 2025, Sirius Real Estate reported a 15.2% year-on-year increase in rent roll, with 5.2%* like-for-like growth driven by strong renewal rates across Germany and the U.K. Despite macroeconomic headwinds, the Group maintained robust occupancy and rental performance, excluding contributions from the large-scale Vantage Point acquisition. €300 million in acquisitions have been completed year-to-date, fully deploying capital from its 2024 equity raise. The Group also secured a €150 million undrawn RCF and now holds ~€400 million in free cash. Sirius is well positioned for further acquisitions, particularly in Germany, as asset valuations are expected to improve.

Altron Limited (AEL) +1.49%

Altron expects solid earnings growth from continuing operations for the six months ended 31 August 2025 (H1 FY26), with HEPS rising 16%–24% to 92–98 cents and EPS up 7%–15% to 80–86 cents. Group-level performance, which includes discontinued operations, reflects a more muted outcome, with HEPS increasing 12%–19% to 83–88 cents, while EPS is anticipated to decline by 4%–11% to 62–67 cents, reflecting prior-period earnings from disposed units. Continuing operations include Netstar, Altron FinTech, and other core businesses, excluding Altron Nexus. Final results will be released on 3 November 2025. These figures have not been reviewed by external auditors.

Jubilee Metals Group Plc (JBL) -6.49%

Jubilee Metals has advanced its strategic repositioning as a pure-play Zambian copper producer, receiving the first US$15 million tranche from the disposal of its South African chrome and PGM operations. Completion is expected by year-end, pending audit and regulatory approvals. Proceeds will support Jubilee’s Three-Pillar Zambia Copper Strategy: Roan (processing third-party feedstock), Sable (mine-to-metal operations), and the Large Waste Project. Q1 FY2026 Roan production reached 915 tonnes of copper concentrate, while Sable’s expansion and Molefe (Munkoyo) mine ramp-up are on track. Jubilee aims for 25,000 tpa copper output, supported by non-dilutive funding and ongoing joint venture and financing discussions.

Exxon Mobil Corporation (XOM) +0.83%

Exxon Mobil expects Q3 2025 upstream earnings to range from a $100 million loss to a $300 million gain, driven by crude price fluctuations. Stronger refining margins could boost earnings by $300 million to $700 million quarter-on-quarter. However, restructuring costs, including 2,000 global job cuts, are projected to impact earnings by $400 million to $600 million. U.S. natural gas price movements may swing upstream results by ±$200 million. Exxon posted $5.4 billion in upstream earnings in Q2. Analysts forecast Q3 adjusted EPS of $1.79. Final results are due 31 October, ahead of TotalEnergies (30 Oct) and BP (4 Nov).

Constellation Brands Inc. (STZ) -2.45%

Constellation Brands reported Q2 FY2026 net sales of $2.48 billion, down 15% but slightly above estimates. EPS came in at $3.63, beating expectations of $3.38. Despite economic pressures and immigration policy impacts dampening demand among key Hispanic consumers, the company reaffirmed its full-year outlook. Beer, its core segment, outperformed the industry, though depletion volume declined 2.7% and shipments fell 8.7%. Tariff increases on aluminium cans and soft U.S. spirits demand continue to pressure margins. Shares rose 4% post-earnings, though down 37% YTD. FY2026 organic sales are expected to decline 4%–6%, with EPS guidance of $11.30–$11.60.

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