NHTSA Reviews Tesla's "Actually Smart Summon" Feature in 2.6M Vehicles After Reported Incidents

SOUTH AFRICAN MARKETS

The Top 40 index fell by 1.01% yesterday, closing at 75,404.5 points, while the All Share index dropped 0.71% to 84,141.5 points. Eskom Holdings' efforts to restructure its distribution unit are being hindered by South African municipalities owing the utility R95.4 billion ($5.1 billion) as of November, compounded by revenue collection challenges and mismanagement. Meanwhile, proposed tax changes to collective investment schemes (CIS) could significantly impact investors, particularly a suggestion to classify all income in CIS as revenue, potentially forcing annual income distributions to avoid income tax on gains.

EUROPEAN MARKETS

The UK's FTSE 100 edged lower on Tuesday as losses in banking stocks outweighed gains in energy shares, with investors awaiting global economic data to gauge monetary policy directions. A European Central Bank survey revealed that euro zone households raised their inflation expectations in November, highlighting ongoing inflation concerns. In Switzerland, inflation eased further in December, with prices rising 0.6% year-on-year, down from November’s 0.7%, strengthening expectations for more interest rate cuts by the Swiss National Bank. In France, consumer prices rose less than anticipated in December, with harmonized inflation at 1.8% year-on-year, slightly below economists’ expectations of 1.9%, according to preliminary data from INSEE.

US MARKETS

U.S. stocks declined on Tuesday as stronger-than-expected economic data raised concerns about inflation and its potential impact on the Federal Reserve's monetary policy easing. Early gains reversed after reports showed an unexpected increase in job openings for November and a surge in input prices within the services sector. Worries over potential tariffs by the incoming Trump administration added to the pressure. Most of the S&P 500 sectors fell, with healthcare and energy as exceptions. Investors are now focused on non-farm payrolls data and the minutes from the Fed’s December meeting later this week.

ASIAN MARKETS

Asian equities were under pressure this morning as a strong dollar kept the yen near six-month lows, with traders speculating that the Federal Reserve might delay rate cuts following stable U.S. economic and labor market data. Tencent Holdings faced selling pressure, with its stock declining over 7% on Tuesday and another 3% today, despite a $193 million share buyback after being added to the U.S. Department of Defense's list of "Chinese military companies." In Australia, annualized CPI rose by 2.3%, slightly surpassing expectations of 2.2%, as reported by the Australian Bureau of Statistics, compared to October’s 2.1% increase.

CURRENCY MARKETS

The South African rand weakened against a stronger dollar on Tuesday, as upbeat U.S. economic data dampened prospects for near-term rate cuts by the Federal Reserve. The pound advanced to a one-week high against the dollar, following reports that President-elect Donald Trump's advisers were considering tariffs only for critical imports. Meanwhile, the yen remained near six-month lows, with the dollar gaining strength overnight on robust U.S. data, driving yields higher and reducing expectations of imminent Federal Reserve rate cuts.

COMMODITY MARKETS

Gold prices edged lower this morning, pressured by a stronger dollar and higher U.S. Treasury yields, as data suggested the Federal Reserve might slow its pace of rate cuts. China's central bank reported an increase in gold reserves for the second consecutive month in December. Oil prices climbed earlier today, supported by tighter supplies from Russia and OPEC members, coupled with data showing unexpected growth in U.S. job openings, which signalled increased economic activity and oil demand. OPEC oil output fell in December due to field maintenance in the UAE, which offset production gains elsewhere in the group, according to a Reuters survey.

Schroder European Real Estate Investment Trust Plc (SCD) -8.60%

Schroder European Real Estate Investment Trust Plc, focused on investing in European growth cities, has announced the sale of a 4,525 sqm grocery-anchored retail asset in Frankfurt, Germany, for €11.8 million, aligning with its 30 September 2024 valuation. Acquired in April 2016 for approximately €11 million, the asset has benefited from management's recent initiatives, including securing long-term leases with Lidl and Fresnapf, enhancing its income profile. The transaction, set to complete on 31 March 2025, ensures the Company retains all income from the asset until completion.

Vunani Limited (VUN) +0.51%

Shareholders of Vunani are informed that negotiations regarding the disposal of a minority shareholding in a subsidiary, as outlined in the cautionary announcement dated 20 November 2024, remain ongoing. If successfully concluded, the Transaction could have a material impact on the Company’s share price. Shareholders are therefore advised to continue exercising caution when trading the Company’s securities until further updates are provided.

Tesla Inc. (TSLA) -4.06%

The National Highway Traffic Safety Administration (NHTSA) has initiated a preliminary investigation into approximately 2.6 million Tesla vehicles in the United States following reports of accidents linked to the "Actually Smart Summon" feature, which enables users to move their vehicles remotely. This new probe follows an October investigation into 2.4 million Tesla vehicles equipped with Full Self-Driving (FSD) software after incidents involving four collisions, including a fatal crash in 2023. According to NHTSA, the crashes under review involve vehicles failing to detect obstacles such as posts or parked cars while using the "Actually Smart Summon" feature. Additionally, the agency noted concerns about users having insufficient reaction time to prevent crashes due to limited visibility or delays in disengaging the app controlling the vehicle's movement.

Samsung Electronics (005930) -0.89%

Samsung Electronics has reported a preliminary operating profit of 6.5 trillion won ($4.47 billion) for the fourth quarter, falling significantly short of analysts’ expectations, which stood at 7.7 trillion won according to LSEG SmartEstimate. The profit reflects a 131% year-on-year increase but marks a 29% decline from the previous quarter. The company's earnings were impacted by rising research and development costs and investments in advanced chip manufacturing capacity, alongside weaker demand for conventional memory chips used in PCs and smartphones. Despite being the world’s largest producer of memory chips, Samsung lagged behind competitor SK Hynix in supplying high-bandwidth memory (HBM) chips to Nvidia, crucial for AI applications. The company did not provide an update on its progress in this sector. Samsung’s detailed fourth-quarter financial results, including performance breakdowns for individual business units, are set to be released on January 31.

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