Taking Stock - Yesterday Woolworths soared the most since 1998.

In todays taking stock, we discuss how yesterday retailer Woolworths soared the most since 1998 after an upbeat trading statement.

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MARKET COMMENTARY

SOUTH AFRICA

The All-Share index jumped 2.1% early yesterday, setting a fresh intraday record, as Naspers was lifted by a surge in partly owned Chinese online giant Tencent Holdings. Retailer Woolworths was also among the leading gainers, soaring the most since 1998 after an upbeat trading statement. Woolworths climbed 10.91% after saying it experienced improved trading momentum across all businesses in the final six weeks of the period ended December 27. At the close of trade, both the All-Share and Top 40 indices finished 0.89% higher.

 

 

EUROPE

European stocks closed sharply lower on Monday afternoon as investors monitored the coronavirus pandemic, and plans for US stimulus measures. The pan-European Stoxx 600 index slid 0.8% by the close, having gained more than 1.2% earlier in the trading session. Travel and leisure stocks fell 1.8% to lead losses on the back of further Covid-19 restrictions, while health care stocks gained 0.7%. Shares of Dutch health technology company Philips traded 2.3% higher after it reported a 7% rise in fourth-quarter core earnings, boosted by demand for its hospital equipment.

 

 

US

The S&P 500 erased earlier losses and rose slightly to a record on Monday as investors prepared for a busy week of earnings featuring reports from the largest tech companies. This coming week, 13 Dow components and 111 S&P 500 companies are set to report earnings. Among the quarterly reports on deck include those from Apple, Microsoft, Netflix, Tesla, McDonald’s, Honeywell, Caterpillar and Boeing. Apple shares gained 2.8% to an all-time high before its quarterly report Wednesday. Tesla, which also reports Wednesday, popped 4% to hit a record.

 

 

ASIA

Stocks in Asia declined this morning as major indices on Wall Street saw fresh closing highs overnight. Minutes from the Bank of Japan’s December monetary policy meeting showed members agreeing that the central bank would “not hesitate to take additional easing measures if necessary” as it monitors the impact of Covid-19. Markets in Australia and India are closed today for holidays.

 

 

 

CURRENCIES

The rand firmed early on Monday as hopes that a massive economic stimulus in the United States would be passed provided some support to markets, with traders expecting the currency to remain vulnerable to global risk-taking mood. At the close, the rand eventually traded at R15.24 versus the US dollar, 0.65% weaker than its close on Friday. The US dollar steadied this morning as rising coronavirus cases and doubts over the speed and size of US stimulus tempered financial markets’ upbeat mood, while investors were also cautious ahead of the Federal Reserve’s review later in the week.

 

 

COMMODITIES

Gold prices firmed this morning as US Treasury yields eased and the metal's appeal as an inflation hedge was boosted by expectations that a large US stimulus would be passed eventually. Oil prices eased in early trade today, giving up some of the previous session’s gains, as hopes for rapid approval of new US economic stimulus faded while new coronavirus infections around the world mount up.

LOCAL COMPANIES

Woolworths (WHL) +10.9%

A trading update by retail giant Woolworths on Monday showed that its food division continues to be a star performer, growing sales by a remarkable 12% for the last six weeks of its half-year to December 27, 2020. The six-week period is part of the festive season peak that includes Black Friday at the end of November and the December holidays. While food sales boomed on the back of more people staying home and eating in due to Covid-19, the pandemic continued to impact sales in the group’s fashion, beauty and home division (FBH), as well as its David Jones business in Australia. It said its food business “remained resilient” throughout the six-month/26-week period, with sales growing 10.9%. Comparable store sales grew 9.4%, while it still managed to grow new store space by 0.4%. The division’s 12% growth in the last six weeks of its half-year saw it gain further market share.

 

INTERNATIONAL COMPANIES

Apple (AAPL) +2.8%

Apple is warning customers that its smartphones could interfere with medical devices, including pacemakers. In a notice published on Apple's support page, the company expanded upon previously issued safety information, warning users that iPhones contain magnets and radios that emit electromagnetic fields, both of which "may interfere" with medical devices such as implanted pacemakers and defibrillators. The notice specifically warns users about "the magnets inside" all four iPhone 12 models, as well as MagSafe accessories. Apple (AAPL) notes that iPhone 12 versions contain more magnets than prior iPhone models, but it also said they don't pose a greater risk of magnetic interference with medical devices than earlier models. Apple said in the update that medical devices can contain sensors that may react to magnets or radio waves that come in close proximity. The company recommends keeping iPhones and MagSafe chargers a "safe distance" away from medical devices — which it defines as more than 6 inches apart, or 15 inches apart when wirelessly charging.

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Media, Sasfin Wealth

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