The JSE closed out the first half of 2023 firmly in the green, triumphing over a rough six months characterised by weaker commodity prices, record load shedding, and a rand rout largely induced by South Africa’s relations with Russia. The benchmark All Share Index closed the first half just over 4% stronger.
Selloff of SA Inc gathers pace “The Chinese economic recovery has not been sustaining the recovery from Covid that everybody was expecting,” adds Takaendesa. Also featuring on the list of stock price losers are consumer-facing and banking stocks such as Capitec, Absa, and Pepkor – all down by double digits. Capitec has a less diversified lending book, which is concentrated in the lower end of the market and is 100% exposed in South Africa.
Capitec FY profits jump 15%, but credit book points to distressed consumer “[Many] SA-related [shares] got a whacking,” says Anchor Capital CEO Peter Armitage, making specific mention of retailers and food producers that have had to contend with the rising cost of running operations as a result of load shedding. “Inflation is quite big on the input side and manufacturing is always very difficult in the context of load shedding,” adds Armitage.
Naspers, Prosus siblings bring cheer to the JSE Cape Town-based tech giant Naspers announced last week that it would be undoing its cross-shareholding structure with Prosus, which investors largely viewed as negative. This and its share buyback plans were very big drivers of the upside in the market, says McCurrie. He highlights Richemont’s strong performance too. This group also undertook a ‘share consolidation’ this year.
Sanlam’s financial services performance hits a ‘historic high’ FirstRand is the only banking stock featuring in the top 15 in terms of share price performance, with its share price up nearly 10%. The banking sector, which had a flat performance , has been disappointing, says Armitage. He adds that while the banks have benefitted from the endowment effect of higher interest rates, interest incomes have been offset by debt ratios, although these ratios are not yet at worrying levels.