Ericsson beats Q4 earnings and launches first share buyback

South African Market Summary

South African equities closed higher, with the All Share Index gaining 0.64% to 122,281.28 points and the Top 40 rising 0.76% to 114,357.72. Strength in Resources, which advanced 3.41%, offset declines in Financials and Industrials. Corporate focus centred on Nissan Motor, which announced plans to sell its Rosslyn manufacturing assets to Chery Automobile’s local unit, subject to regulatory approval. The proposed disposal forms part of Nissan’s global restructuring and reflects intensifying competition in South Africa’s light commercial vehicle market.The CEO of Chery South Africa had said in October that the company was considering using another manufacturer's facility, forming a joint venture or building its own greenfield site in South Africa.

European Market Summary

European equities ended lower and recorded weekly losses as investors weighed geopolitical uncertainty linked to rising tensions with the United States. The STOXX 600 snapped a five-week winning streak, with insurance stocks underperforming amid a sell-off in longer-dated bonds. Elevated energy and mining prices helped cushion broader declines, reflecting persistent risk aversion. On the corporate front, Ericsson rallied sharply after a fourth-quarter earnings beat and the announcement of a share buyback, while Adidas and Puma weakened following broker downgrades and valuation concerns.

American Market Summary

US markets finished mixed after a volatile week, with the Dow Jones easing and the S&P 500 broadly flat. Sentiment was dented by a sharp sell-off in Intel, which issued weaker-than-expected guidance amid challenges in meeting AI-related server chip demand. Despite geopolitical noise around potential US tariffs, investors remain broadly constructive on US economic resilience. Mega-cap technology stocks rebounded, supported by ongoing AI optimism, while Nvidia gained after reports of potential renewed demand from major Chinese technology groups.

Asian Market Summary

Asia-Pacific markets traded mixed as investors assessed geopolitical risks and regional data. China reported a year-on-year decline in foreign direct investment during 2025, highlighting ongoing structural and confidence challenges, although inflows from select European and Middle Eastern countries improved. In corporate developments, Chinese energy drink producer Eastroc Beverage is pursuing a sizeable Hong Kong listing to fund capacity expansion, while South Korea’s S-Oil posted a sharp rise in quarterly operating profit and guided to resilient refining margins, supported by supply disruptions and steady demand.

Currency Market Summary

The South African rand softened modestly but remained close to the 16-per-dollar level as markets positioned ahead of the upcoming central bank interest rate decision. In global markets, the Japanese yen strengthened sharply, fuelling speculation around potential coordinated intervention and pressuring the US dollar. The euro traded at multi-month highs, while strength in the yen and euro coincided with a renewed surge in precious metals prices. Currency moves reflect heightened sensitivity to policy signals, geopolitical risk and relative interest rate expectations across major developed and emerging markets.

Commodity Market Summary

Oil prices stabilised after recent gains as supply disruptions in the United States and heightened Middle East tensions continued to underpin the market. Weather-related production losses and geopolitical risk premia offset concerns around demand momentum. Kazakhstan’s Caspian Pipeline Consortium returned to full capacity following maintenance, easing some supply pressure. Meanwhile, gold surged to fresh record highs as investors sought safety amid rising geopolitical uncertainty and currency volatility. The continued strength in precious metals underscores a defensive shift in positioning, with investors increasingly favouring hard assets as hedges against geopolitical and macroeconomic risk.

Valterra Platinum Limited (VAL) +3.55%

Valterra Platinum flagged a materially stronger earnings outcome for FY25, with headline earnings and HEPS expected to rise 85%–105% year on year, supported by a 26% higher PGM dollar basket price and R5 billion in operational cost reductions. Basic earnings are forecast to increase 105%–125% despite lower sales volumes following prior-period work-in-progress drawdowns and flooding at Amandelbult, partially offset by insurance proceeds. Results also reflect demerger-related costs and non-recurring asset write-offs.

Reinet Investments S.C.A. (RNI) -0.22%

Reinet Investments reported a modest decline in net asset value (NAV) during the December 2025 quarter, with NAV easing 1.0% quarter on quarter to EUR 6.6 billion and NAV per share falling to EUR 36.24. Long-term performance remains robust, reflecting an 8.4% compound annual growth rate in euro terms since 2009, including dividends. During the quarter, EUR 15 million of commitments were funded. The agreed sale of Pension Insurance Corporation Group to Athora, expected to close in 2026, remains a key near-term portfolio catalyst.

Mr Price Group Limited (MRP) -0.19%

Mr Price Group provided a progress update on its acquisition of NKD Group GmbH, confirming continued advancement towards meeting conditions precedent. The key remaining approval relates to the European Commission’s Foreign Subsidies Regulation, with the formal review period now underway and no material delays anticipated. The Group also confirmed plans to host an investor presentation in Cape Town on 17 March 2026, where management will outline NKD’s strategic fit and growth prospects, offering investors deeper insight into the transaction rationale and medium-term opportunities.

Telefonaktiebolaget LM Ericsson Class B (ERIC.B) +10.52%

Ericsson reported a strong fourth-quarter performance, materially beating earnings expectations and announcing its first-ever share buyback programme, returning SEK 15 billion to shareholders through 2027. Improved profitability reflected disciplined cost control, restructuring progress and resilient demand across Europe, the Middle East and Africa, offsetting softer global 5G investment trends. A strengthened cash position, supported by asset disposals, underpinned both the buyback and a higher dividend. Management highlighted potential longer-term upside from European initiatives to reduce reliance on high-risk network equipment suppliers.

SLB Limited (SLB) -0.34%

SLB delivered a fourth-quarter earnings beat, supported by the integration of ChampionX, which materially lifted North American revenues and profitability despite softer underlying activity. ChampionX expanded SLB’s exposure to production chemicals and artificial lift, strengthening margins and cash generation. While management guided to a sequential revenue and profit decline in the first quarter due to seasonal weakness, shareholder returns were enhanced through a higher dividend and planned buybacks. Longer term, SLB highlighted optionality from a potential ramp-up in Venezuela, subject to licensing and compliance conditions.

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