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Port Elizabeth - Local shares continued their gallop to new records at the beginning of last week, until Wednesday when it seems that investors decided to cash in a bit of their profits.
By Friday the main indices were all a few hundred points below the mid-week highs.
It seemed that the futures market was leading the way down all through Thursday and Friday with share prices following a few minutes later.
This slight weakness came without any specific negative news.
To date, companies announced steady results, except for African Bank [JSE: ABL] that warned investors that their earnings will show a drop of around 90% in the current 12 months when the company announce their results in a few weeks' time.
The culprit is much higher provisions for bad debt on their largely unsecured lending book.
Clicks Stores [JSE: CLS] announced that their earnings increased by just more than 9%, which the market rewarded with a small increase in its share price.
PicknPay [JSE:PNP] said that their headline EPS increased by 36% in the first half year and that prospects for the second half look promising.
Following last week's announcement of steady retail sales and these selected solid results, retail and related shares ended the week quite strong.
It was noticeable that one or two of the larger companies in each sector ended the week lower.
Amongst these were Amplats [JSE: AMS], Anglo American [JSE: ANG], Kumba Iron Ore [JSE: KMB], Barloworld [JSE: BAW], Imperial [JSE: IPL] and most banks.
The week ahead
Banks and financial services should be watched following Abil's announcement of an increase in bad debt.
Although the banks service different markets, they are operating under the same economic environment and might also show increases in their provisions for doubtful debt.
These provisions are written off against profit, nowhere else.
In addition, the Reserve Bank will anounce money supply figures this week, which include the growth in private credit extension.
This is another indicator of how banks are doing.
StatsSA will announce unemployment figures for the quarter to September and the change in the producer price index for September.
Company news to watch out for include a trading update from Nedbank [JSE: NED] and results from Arcelor Mittall [JSE: ACL].
- Fin24
By Friday the main indices were all a few hundred points below the mid-week highs.
It seemed that the futures market was leading the way down all through Thursday and Friday with share prices following a few minutes later.
This slight weakness came without any specific negative news.
To date, companies announced steady results, except for African Bank [JSE: ABL] that warned investors that their earnings will show a drop of around 90% in the current 12 months when the company announce their results in a few weeks' time.
The culprit is much higher provisions for bad debt on their largely unsecured lending book.
Clicks Stores [JSE: CLS] announced that their earnings increased by just more than 9%, which the market rewarded with a small increase in its share price.
PicknPay [JSE:PNP] said that their headline EPS increased by 36% in the first half year and that prospects for the second half look promising.
Following last week's announcement of steady retail sales and these selected solid results, retail and related shares ended the week quite strong.
It was noticeable that one or two of the larger companies in each sector ended the week lower.
Amongst these were Amplats [JSE: AMS], Anglo American [JSE: ANG], Kumba Iron Ore [JSE: KMB], Barloworld [JSE: BAW], Imperial [JSE: IPL] and most banks.
The week ahead
Banks and financial services should be watched following Abil's announcement of an increase in bad debt.
Although the banks service different markets, they are operating under the same economic environment and might also show increases in their provisions for doubtful debt.
These provisions are written off against profit, nowhere else.
In addition, the Reserve Bank will anounce money supply figures this week, which include the growth in private credit extension.
This is another indicator of how banks are doing.
StatsSA will announce unemployment figures for the quarter to September and the change in the producer price index for September.
Company news to watch out for include a trading update from Nedbank [JSE: NED] and results from Arcelor Mittall [JSE: ACL].
- Fin24
