Boeing to Lay Off Over 2,500 Workers in U.S. Amid 17,000 Global Job Cuts

LOCAL MARKET COMMENTARY

The Top 40 index gained 0.6% on Monday, closing at 76,224 points, while the All Share index rose 0.7% to 84,425 points. Investors are turning their attention to October inflation data and the South African Reserve Bank's interest rate decision on Thursday, where a 25-basis-point rate cut is anticipated. Despite net foreign outflows of $6.1 billion from South African stocks this year, November has seen a significant slowdown, with only $62 million in outflows month-to-date, according to Bloomberg and JSE data. Meanwhile, the National Transmission Company of South Africa (NTCSA) reported that the electricity system remains “adequate” as long as Eskom sustains its current strong plant performance.

EUROPEAN MARKET COMMENTARY

European markets dipped on Monday as investors shifted their focus to upcoming regional inflation data. Key economic indicators this week include the U.K.'s latest inflation figures, expected on Wednesday, following a disappointing GDP growth of just 0.1% in the third quarter. Additionally, the final reading of the euro zone's consumer price index and several purchasing managers' index (PMI) reports across the region are due on Friday. Investors will also be closely watching remarks from central bank officials, including European Central Bank (ECB) President Christine Lagarde, for any hints on potential interest rate cuts in December.

US MARKET COMMENTARY

The Nasdaq and S&P 500 ended higher on Monday, regaining some ground as investors looked ahead to Nvidia's upcoming quarterly earnings report. Nvidia, a key player in the AI market, is set to release its third-quarter results on Wednesday, with investors eager to evaluate the demand for its chips and the durability of the AI-driven market rally. Additionally, Tesla's stock surged on expectations of favourable policy shifts under the incoming Trump administration, boosting market sentiment.

ASIA MARKET COMMENTARY

Asia-Pacific markets opened higher this morning as investors analysed speeches from Chinese financial policymakers at an investment summit in Hong Kong. Chinese Vice Premier He Lifeng emphasized Beijing's support for Hong Kong's innovation and financial reforms, aiming to boost the city's competitiveness as an international financial hub. He Lifeng, a key figure in economic policy, delivered the opening keynote speech at the summit, highlighting China's commitment to strengthening Hong Kong's financial status.

CURRENCY MARKET COMMENTARY

South Africa's rand surged on Monday after S&P raised the country's credit rating outlook, boosting market sentiment. Meanwhile, the yen steadied this morning, trading stronger than 155 per dollar, helped by a retreat in the U.S. dollar. The dollar eased as traders took profits following its recent rally to a one-year high against a basket of major currencies, leading to a broader market pullback.

COMMODITY MARKET COMMENTARY

Gold prices rose to a one-week high this morning, supported by a weaker U.S. dollar as investors awaited insights from Federal Reserve officials on the future direction of U.S. interest rates. Meanwhile, oil prices pulled back after Monday's gains, which were driven by a temporary halt in production at Norway's Johan Sverdrup oilfield. However, market sentiment remained cautious due to ongoing concerns about a potential escalation in the Russia-Ukraine conflict, keeping investors on edge.

Naspers Limited (NPN) +0.72%

For the period ending 30 September 2024, the Group anticipates a significant increase in earnings from its continuing operations compared to the same period in 2023. Earnings per share (EPS) are expected to rise by 35.0% to 41.5%, headline EPS by 103.2% to 109.6%, and core headline EPS by 87.2% to 93.8%. For total operations, EPS is projected to grow by 44.0% to 51.0%, headline EPS by 125.0% to 132.0%, and core headline EPS by 99.0% to 106.0%.

Astral Foods Limited (ARL) +2.19%

For the 12 months ending 30 September 2024, the Group’s revenue increased by 6% to R20.48 billion. Operating profit rebounded strongly to R1.12 billion, compared to a loss of R620.88 million in the prior year. Net profit recovered to R752.9 million from a loss of R512.2 million last year. Total assets remained steady, while total equity rose by 18% and liabilities dropped by 15%. EPS improved to 1,959 cents from a loss of 1,333 cents, and headline EPS climbed to 1,920 cents from a loss of 1,324 cents. A final dividend of 520 cents per share was declared.

We Buy Cars Holdings Limited (WBC) -0.15%

For the year ending 30 September 2024, the Group recorded a 17.8% increase in units purchased and a 16.4% rise in units sold compared to 2023. Revenue grew by 16.5% to R23.32 billion. Core headline earnings increased by 23.4% to R815.4 million, with core headline EPS rising by 9.9% to 217.4 cents. However, basic earnings fell by 58.2% to R343.1 million, reducing basic EPS by 62.8% to 91.5 cents. Similarly, headline earnings declined by 58.0% to R343.9 million, with headline EPS down by 62.6% to 91.7 cents.

Telkom SA SOC Limited (TKG) +4.65%

For the first half of FY2025, the Group reported a 2.1% increase in revenue to R21.8 billion, with a 1.9% rise from continuing operations and an 11.3% boost from discontinued operations. EBITDA grew by 2.1% to R5.13 billion, while adjusted EBITDA showed a substantial 17.6% increase. Profit for the period rose by 9.7% to R1.07 billion, with adjusted profit up 67.9%. EPS increased by 8.7% to 217.6 cents, and adjusted EPS surged by 66.5% to 333.3 cents. Headline EPS decreased slightly by 1.8% but rose strongly by 57.5% on an adjusted basis. No dividends were declared for this period.

Archer-Daniels-Midland Company (ADM) -1.20%

Archer-Daniels-Midland (ADM) reported a sharp decline in third-quarter profits on Monday, impacted by weakness in its grain business and accounting irregularities that delayed the earnings release. Falling prices for key crops like corn and soybeans led to reduced profits and margins, particularly in ADM's grain origination and crushing segment. The company restated financial results for 2023 and the first half of 2024, revealing a 28.3% drop in total segment operating profit to $1.04 billion. ADM's largest segment, Ag Services & Oilseeds, saw a 43% profit decline. Net earnings plummeted to $18 million (4 cents per share) from $821 million ($1.52 per share) a year earlier. Despite the challenges, ADM reaffirmed its full-year earnings guidance of $4.50 to $5.00 per share, with shares edging up 0.2% in after-hours trading to $52.83.

Boeing Company (BA) +2.63%

Boeing is set to lay off over 2,500 workers in the U.S., impacting employees in Washington, Oregon, South Carolina, and Missouri, as part of a broader plan to cut 17,000 jobs—10% of its global workforce. Approximately 2,200 notices were issued in Washington, where commercial airliners are built, and 220 in South Carolina. Affected employees will remain on the payroll until January 17 to meet federal requirements for a 60-day advance notice under the Worker Adjustment and Retraining Notification (WARN) Act. Additional layoffs are anticipated in December. Boeing may also reduce its workforce through attrition, selective hiring, and subsidiary sales. The company declined to comment on the layoffs.

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