Taking Stock - Anglo American Platinum.

In todays taking stock, we discuss how Anglo American Platinum, Successfully Completes the Rebuild of it ACP Phase A Unit.

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MARKET COMMENTARY

SOUTH AFRICAN MARKET COMMENTARY

The All-Share index added 0.18% yesterday (now at 59,528 index points) as it posted its fifth straight daily gain, while the Top 40 index added. Resources added 0.84%, while financials and industrials dropped 0.04% and 0.45% respectively. Investors are awaiting the latest GPD data which is expected later today. Third quarter GDP is expected to come in around 52.6%, while the year-on-year consensus is at -7.2%. In fixed income, the yield on the benchmark 10-year government bond was down 4 basis point to 8.95%.

 

 

EUROPEAN MARKET COMMENTARY

 

European stocks closed lower Monday as market focus in the region centred on a last-ditch effort between the UK and EU to reach a post-Brexit trade deal. The pan-European Stoxx 600 index closed 0.3% lower, with the majority of sectors finishing in negative territory. The UK and EU are making last efforts to reach a post-Brexit trade deal this week, with Britain’s chief negotiator going to Brussels on Sunday in a bid to salvage talks that had to be paused on Friday, due to outstanding issues that remain to be resolved, including fishing rights and competition rules.

 

 

US MARKET COMMENTARY

 

The Dow Jones Industrial Average and S&P 500 fell on Monday following a record-setting session as traders worried about rising coronavirus cases and searched for clues on additional fiscal aid. Value stocks lagged their growth counterparts on Monday as uncertainty grew over the near-term economic outlook. Intel was the worst-performing Dow stock, falling 3.4%. The energy sector led the S&P 500 lower, sliding 2.4%. Facebook rose 2.1%, and Apple gained 1.2% to lead the Nasdaq higher. Tesla also contributed to the Nasdaq’s gains, advancing 7.1% and reaching an all-time high.

 

 

ASIAN MARKET COMMENTARY

Asian markets traded mixed this morning as investors remained cautious over rising coronavirus cases, US stimulus negotiations as well as Brexit talks between the UK and the European Union. Australia’s benchmark ASX 200 reversed earlier losses to trade up 0.2%. The energy subindex erased some of its losses but was still down 0.65%. It happened after oil prices slipped in the overnight session on Monday. In Hong Kong, the Hang Seng index fell 0.53% in early trade. The health-care arm of Chinese e-commerce giant JD.com made its trading debut in Hong Kong and saw its share price surge compared to the company’s issue price.

 

 

CURRENCY MARKET COMMENTARY

 

The rand steadied in early trade on Monday, as investors stayed away from taking big positions ahead of a slew of data, which will give some insights into the health of Africa’s most industrialised economy. Statistics South Africa will publish third-quarter gross domestic product (GDP) figures today, while consumer price inflation (CPI) and retail sales data is due on Wednesday. At the close, the rand traded at R15.15 versus the US dollar or 0.53% firmer.

 

 

COMMODITIES MARKET COMMENTARY

Gold prices held steady near a two-week high this morning as mounting COVID-19 cases and fresh restrictions boosted hopes for a US pandemic stimulus package. Oil prices fell this morning, adding to losses from the previous session that came as California tightened its pandemic lockdown through Christmas and coronavirus cases continued to surge in the United States and Europe. California on Monday faced a raft of new COVID-19 restrictions, while a ban on indoor restaurant dining loomed in New York City.

 

LOCAL COMPANIES

Long4Life (L4L) +1.0%

The investment holding company founded by CEO Brian Joffe, which predominantly invests in lifestyle assets, such as Sorbet beauty franchises, Sportsman’s Warehouse and Outdoor Warehouse stores, reported it will buy back its own shares to the tune of R113.8 million. The lack of investment opportunities in the current low growth environment, forced the group to opt for buy backs rather than sitting on cash. The group will spend a maximum of R3.16 per share to purchase as much as 36 million shares, or around 4.7% of its outstanding issue, between 7 and 14 December. Company directors had undertaken not to sell their shares during the duration of the share buyback, the group said in a statement.

 

Anglo American Platinum (AMS) +4.7%

Anglo American Platinum, one world’s leading platinum miners, announced on Monday it has successfully completed the rebuild of its Anglo Converter Plant (ACP) Phase A unit, which production expected to ramp up to full capacity by the end of the year. Both the ACP Phase A and Phase B units were shut down in March, following an explosion at the plant, forcing the miner to declare a force majeure to suppliers. CEO Natascha Viljoen: “We were able to procure and deliver long lead-time items to site six months ahead of schedule, despite the impact of Covid-19 on supply chains, enabling us to bring forward the rebuild to the end of 2020, ahead of our initial expectations of Q2 2021”. Due to the early completion of the unit, the group has upgraded refined production guidance for 2020 to between 2.6 – 2.7 million PGM ounces, up from the previous guidance of 2.5 million PGM ounces.

 

INTERNATIONAL COMPANIES

JD.com (JD) -2.0%

China e-commerce giant JD.com announced it has become the first online platform to accept the country’s new digital currency, known as the digital yuan. The digital yuan, which is controlled and issued by the People’s Bank of China, is what’s known as a central bank digital currency. Global central banks are aiming to close the gap on cryptocurrencies like bitcoin and ethereum, as they promise to be more efficient cross-border payment mechanisms as many countries moves towards a cashless society. Residents of Suzhou were given free digital yuan as part of a test, with 100,000 digital currency vouchers are valued at about 20 million yuan ($3 million), with the e-commerce group accepting it as payment.

 

Walmart (WMT) -0.5%

The discount retailing giant has hired Goldman Sachs to assist with listing its India-based online retailer Flipkart in the US, as the retailer is considering to divest around 25% of its holding for $10Bn. "Work on the IPO (initial public offering) is on in full swing and the advent of the pandemic has only hastened the process, given the spectacular surge in demand on e-commerce platforms”, a source told Indian financial newspaper Mint. If successful, it will be the largest IPO by an Indian based company on overseas stock exchange. The retail group bought a 77% stake in Flipkart for $16Bn in 2018, and pledged to take the group public in four years.

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Media, Sasfin Wealth

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